Cigarette Smuggling in Response to Large Tax Increase is Greatly Exaggerated.
Wednesday, January 17, 2018
Posted by: Natalia Gromov
Chaloupka FJ.
Cigarette Smuggling in Response to Large Tax Increase is Greatly Exaggerated.
A Tobacconomics Research Brief. Chicago, IL: Tboacconomics, Health Policy Cener, Institute for Health Research and Policy, University of Illinois at Chicago, 2017. http://www.tobacconomics.org/.
Concerns about increased tax avoidance and evasion have deterred many states from raising their cigarette and other tobacco taxes. Experiences with cigarette tax increases across states show that these concerns are greatly exaggerated. Every state that has passed a significant cigarette tax increase has enjoyed a substantial, sustained increase in its state cigarette tax revenues. This revenue increase occurs, despite the significant declines in smoking rates and tax-paid cigarette sales caused by the cigarette tax rate increase, and despite any increases in cigarette tax avoidance and evasion.
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