Shocker! Tax hikes causes smuggling!
Last November, Maryland Governor O’Malley snuck up behind Marylanders and stabbed us in the back with a massive tax hike. Part of that tax hike was a doubling of the cigarette tax. At the time I wrote;
A pack of cigarettes in Maryland is already nearly $5/pack. Jack it up to $6, you fools – most Marylanders only need to drive a few miles in almost any direction and buy them cheaper. Raising the price $10/carton more makes it much more attractive to buy them out of State. How much revenue ya got then, chump?
Well, now we get our answer a mere nine months later as reported in the Wall Street Journal;
Politicians in Annapolis are scratching their heads wondering what happened to all those chain smokers who were supposed to help balance Maryland’s budget. Last year the legislature doubled the cigarette tax to $2 a pack to pay for expanded health-care coverage. Eight months later, cigarette sales have plunged 25% and the state is in fiscal distress again.
A few pols are pretending to be happy that 30 million fewer cigarette packs have been bought in the state so far this year. As House Majority Leader Kumar Barve put it, fewer people smoking is “a good thing.” Yes, except that Maryland may be losing retail sales more than smokers. Residents of Maryland’s Washington suburbs can shop in nearby Virginia, where the tax is only 30 cents a pack, and save at least $15 per carton.
The Maryland pols are so afraid this is true that they’ve made it a crime for residents to carry two packs of cigarettes that weren’t purchased in the state. In other words, the state says it’s legal to smoke, so long as you use cigarettes that the government can tax and thus become a financial partner in your bad habit. But if you dare to buy smokes across state lines, you can be fined.
Um, didn’t I warn you goofballs? Hell, you can even buy cigarettes on line, pay for shipping and it’s still cheaper than cigarettes in Maryland. Not that I do it – I don’t have to. But smuggling is a fact of life that politicians don’t understand. Whenever you make something difficult or expensive to buy, people will always find a way around it. It’s human nature.
As soon as Maryland’s tax went up, the border with Pennsylvania was dotted with new cigarette shops – the same thing that happened when New York raised it’s cigarette taxes. I was in Delaware a few weeks ago and it’s the same there.
Too bad O’Malley can’t find a way to tax the American spirit.
Crossposted at Red Maryland.
Years ago, many years ago; when Canada began raising cigarette taxes so high, it became quite profitable for a few truckers to just add 250 or so cartons of cigs to their freight load of meat, produce, whatever; depriving the gummint of all taxes for those cigs. There as in Maryland, the end result was less income for gummint. Not less smokers. This is a good analogy to use with those who claim higher taxes mean more revenue. There isn’t much that a creative mind can’t find elsewhere at much less cost. What surprised me is that Virginia, (the komminest state), is that competitive. Guess it is that cigs are a “homegrown” commodity.
nuf sed
God bless our heroic cigarette smugglers! Without them, our habits for smooth, refreshing nicotine would be impossible.
I can see it now…Some poor old Grandmother sitting at her kitchen table fresh off her trip to NC for the weekend. As she settles in to make an apple pie…BANG…POW… The door comes off the hinges and flash bang grenades go off as Maryland’s Cigarette SWAT Team makes its entry to take down this modern day Pirate. Seizing the 5 cartons of contraband she is charged with Tax evasion and the Governor smiles as the Dem nanny state looks on.
Hmmmm…. reminds me of years back in WA state and Gov Rossellini, and what became known as Rossellini’s raiders. The Gov increased the state tax on smokes considerably. OR had a lot lower tax plus no sales tax so everyone would visit Portland on the weekend and stock up. When the revenue dropped they started following folks to stores in Portland and watch them buy smokes, turn the license numbers to Rossillini’s raiders and you would get stopped on the way back and searched.
Picked up some nice extra cash for awhile, but all good things come to an end.
Hope this isn’t a dupe comment
Hmmmm…. reminds me of years back in WA state and Gov Rossellini, and what became known as Rossellini’s raiders. The Gov increased the state tax on smokes considerably. OR had a lot lower tax plus no sales tax so everyone would visit Portland on the weekend and stock up. When the revenue dropped they started following folks to stores in Portland and watch them buy smokes, turn the license numbers to Rossillini’s raiders and you would get stopped on the way back and searched.
Standing in line at the groc. and Doral cigarettes were $50 a carton. FIFTY DOLLARS. I couldn’t believe it. Damn straight I’d be going across the State line — and while I’m there, might as well buy lottery tickets and gas, too.
One Semi load can make you a profit of $50,000 + and like the hundreds of loads going to NYC the need in Maryland will be fulfilled. A few cartons per week can be mailed by the USPS, friends in other places can do it for you. Is there a mamal or worm on earth that is more stupid than a politician?
Who could be more stupid than someone who smokes?Might as well put that gun to your head and save yourself your family and the taxpayer some pain.
Jonn wrote: After that tear-soaked email you sent me the other day decrying us as racists and haters, and telling me you’re leaving TAH, you come back here to judge us? The secret to leaving a web community is fighting that urge to click on the bookmark.
sorry bout that but seriously what could possibly be more self destructive than smoking?
Jonn wrote: Voting for Obama.
We have some outrageous cig taxes in New York State, but we have a cheap option, Indian Reservations. The Tonawanda Reservation in Basom, NY (just up the road from Darien Lake Amusement Park) is only 45 minutes away and one can get decent tasting native brand cigs for $10 a carton. I don’t smoke, but the people that I know that do smoke take turns going to “The Rez” to get their smokes. Oh yeah, they also have cheap gas with no taxes at “The Rez” as well, so whoever turn it is gets the bonus of a cheap fill-up.
Jonn I said some were racists(and proud of it),some were haters,and some were just plain stupid.Your comment(if you believe it) confirms part three.Quit smoking for your family’s sake man.Richard
Jonn wrote: Grow up, Richard. My mother is still alive, I don’t need a surrogate. Besides, when have I ever said I smoke? You assume, too much. When I want your advice, I’ll ask for it. I’m sure you have your own children that you can henpeck.