The recent death of Eric Garner after an incident with New York police has recently made headlines and sparked controversy about excessive force and police practices. Sources report that police and prosecutors are...
- The Tax Policy Blog
- D.C. Cigarette Tax Revenues Continue to Plunge After Rate...
D.C. Cigarette Tax Revenues Continue to Plunge After Rate Hike
Back in March, we noted that the District of Columbia faced lower cigarette tax revenues than expected after its recent its recent cigarette tax rate increase from $2 per pack to $2.50 per pack. That downward trend has continued:
Cigarette tax collections continue their stunning collapse in FY 2010, down 23.6 percent between October and April compared to the same period a year earlier. The $15.9 million in tobacco tax collections through April are off $4.9 million despite a region highest $2.50 per pack tobacco tax. The tax rate, 50 cents higher than it was in 2009, took effect Oct. 1.[...]
[W]hen the council agreed to hike the cigarette tax last summer, [it projected] a $9.7 million bump in tobacco revenues. [Instead], it created a $15 million-plus hole in the budget.
D.C. Chief Financial Officer Natwar Gandhi admits that smokers probably went elsewhere for cigarette purchases. (Maryland's tax is $2 per pack; Virginia's is 30 cents per pack.
Subscribe to the Tax Foundation Newsletter
Join the Tax Foundation's fight for sound tax policy Go
About the Tax Policy Blog
The Tax Policy Blog is the official weblog of the Tax Foundation, a non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937. Our economists welcome your feedback. If you would like to send an e-mail to the author of a blog post, please click on that person's name to locate his or her e-mail address or visit our staff page here.