Cigarette & Tobacco Tax

BACKGROUND

The cigarette tax was adopted in Massachusetts in 1939. There have been numerous campaigns over the years to continue or enhance this revenue stream.

1992: Question 1 ballot initiative created the Massachusetts Tobacco Control Program and raised the state cigarette tax by $0.25, from $0.26 to $0.51 a pack.

2002: The Commonwealth last raised the cigarette tax, by $0.75.

2008: The Massachusetts cigarette tax has increased by an additional 50 mills per cigarette ($1.00 per package of 20 and $1.25 per package of 25), increasing the excise rates to:

• $2.51 per package of 20 cigarettes
• $3.1375 per package of 25 cigarettes

"The Massachusetts Department of Revenue has estimated that the cigarette tax increases enacted from 1993 through 2008 will generate an additional $444 million in revenue in FY 2010. At the time of the most recent tax increase, taxes on other tobacco products were not made equal to the tax on cigarettes." [MassBudget]

TOBACCO TAX OPTIONS

"It is possible to raise tax rates on other forms of tobacco (such as roll-your-own cigarette tobacco, chewing tobacco, and cigars), so that all tobacco products are taxed at the same rate — for example, on a per-dose basis, or as a percentage of their wholesale price. Such a tax structure would create horizontal equity in taxation among all tobacco products, and would remove price incentives for teens and adults simply to shift their tobacco use from pre-rolled cigarettes to other tobacco products rather than to quit using tobacco altogether. The fewer tobacco users there are in Massachusetts, the lower will be the Commonwealth’s medical and other related costs -– both public and private." [MassBudget]

ADDITIONAL RESOURCES

• Campaign for Tobacco-Free Kids
  • Report: Raising Cigarette Taxes Reduces Smoking, Especially Among Kids
  • The Toll of Tobacco in Massachusetts
• Tobacco Free Mass
• Mass Department of Revenue
  • Cigarette and Tobacco Tax Info
• Massachusetts Budget and Policy Center
  • The Selective Sales Taxes (Cigarette Excise Tax)