23%! New York Tobacco Tax Rises to $5.35, Highest in the United States

According to a September 5 report by Forbes, a U.S. business media outlet, New York State’s tobacco tax became the highest in the United States starting September 1. The tax on every 20 cigarettes increased from $4.35 to $5.35, pushing the retail price of a pack of cigarettes in the state to around $10.

If residents smoke in New York City, the price is even higher. The tax on every 20 cigarettes, including both New York State and New York City taxes, has reached $6.85, up from the previous $5.85. This $1 increase is the state’s first tobacco tax hike since 2010.

An analysis conducted by the Congressional Budget Office (CBO) in 2012 estimated that every 1% increase in cigarette prices would lead to about a 0.3% decline in the number of smokers. It also noted that the total reduction in smoking could be even greater, because studies show that higher taxes not only reduce the number of smokers but also reduce the average number of cigarettes smoked by those who continue to smoke.

The American Lung Association also recommends raising cigarette prices, including through higher taxes, in order to reduce smoking rates. It estimates that a 10% increase in cigarette prices would reduce adult smoking by 4% and youth smoking by 7%. This is why the organization advocates doubling the federal cigarette tax rate, along with other policy measures.

At present, the average tobacco tax across U.S. states is $1.93 per pack. Missouri has the lowest tobacco tax, at just $0.17 per pack. More than half of the states have not raised tobacco taxes in the past decade. You can check your state’s situation here.

This news is significant for professionals in China’s vaping industry, because smokers may look for alternatives, and e-cigarettes could become one of those options. At the same time, changes in tobacco policy around the world can also affect trends in the international tobacco market.