Monday, August 23, 2010

Alcohol and Tobacco

States across the country turned to raising the tax on alcohol and tobacco as a way to increase revenue and close budget gaps. Here's a recap on what passed in 2010 for FY2011 by state:

Lawmakers proposed increasing the alcohol tax by 60% to generate an expected $210 million.

Enacted: The State Attorney General is pursuing the collection of the state tobacco tax from Hawaii residents who purchase cigarettes via the Internet but did not pay tax on them. The Attorney General estimates that the state could be missing between $600,000 and $700,000 in uncollected tax revenue.

Enacted: HB 1985 raised the cigarette tax by 20-cents per pack. The measure also increases the taxes on small cigars by 1-cent per cigar. The measure is expected to generate $10 to $14 million a year.
Enacted: The Dept. of Revenue issued a new sales tax rate on cigarettes. The new rate, effective Aug. 1, 2010, is $.0346 per pack.

Lawmakers proposed privatizing liquor stores.

Enacted: Measure expands hours of operation for bars. Bars will be permitted to stay open till 2am.

New Mexico
Enacted: The cigarette tax will increase by 75-cents per pack for four years. The state’s cigarette tax would rise from 91-cents to $1.66 per pack. The measure would generate an estimated $33 million in FY 2011.

New York
Enacted: Budget includes a $290 million tax increase on cigarettes and other tobacco products, raising the tax from $2.75 a pack to $4.35.

South Carolina
Enacted: A 50-cent increase in the tax per pack of cigarettes.

South Dakota
Governor proposed increasing the cigarette tax to offset a proposed corporate income tax cut. Bills pending in the General Assembly propose per-pack increases ranging from 30-cents to 86-cents.

Enacted: Enacted budget increases cigarette tax from $0.695 to $1.695 per pack. Tax on cigars will increase from 35% to 86% of the manufacture’s sale price. Tax on moist snuff will increase from $0.75 to $1.83 per ounce. The tax increase is expected to raise $43 million for FY 2011.

Governor proposed increasing markup on alcoholic beverages by 2%.
Governor proposed privatizing liquor stores.

Group of lawmakers proposed privatizing liquor stores to receive $350 million in revenue over 5 years.
Enacted: House approved increased taxes on beer which would tax non-microbrewed beer at 50 cents per gallon.
Governor proposed increasing tax by a $1 per pack, generating an estimated $95 million in FY 2011.
Enacted: House approved increased taxes on cigarettes.

Governor signed into law early February a cigarette tax increase of $2 per pack.
For the full list from NCSL of failed and enacted legislation for alcohol and tobacco, click here.

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