Tax Facts - History

Cigarettes are one of the most heavily taxed consumer products in the United States.

Federal, state and local governments collect more money from the sale of cigarettes than retailers, wholesalers, farmers and manufacturers combined.

In FY2007, alone, between federal tax, state and local taxes, and tobacco settlement payments, the government raked in more than $30 BILLION:

• $7.3 billion in federal excise taxes
• $14.5 billion in state excise taxes
• $7.2 billion is state settlement payments

Since FY1997, the weighted state average tax has gone up 197.5% — from 32.1¢ to 95.3¢ as of January 2008. From 1997-2008, there have been 93 excise tax increases in 45 states and the District of Columbia.

Total state excise tax revenues have risen 98.4%, from $7.3 billion in FY1997, to $14.5 billion in FY2007

Cigarette Retail and Taxes

• As of November 1, 2007, the average retail price of a package of 20 cigarettes (full-priced brands), was $4.53, including federal, state and municipal excise taxes.
  
  
• Federal and state excise taxes accounted, on average, for 32.3 percent of the retail price of cigarettes.
  
  
• Nearly 64% of all tobacco sales occur in the nation’s 145,119 convenience stores, according to a 2006 National Association of Convenience Stores (NACS) study.
  
  
• The average convenience store sells about $438,000 worth of cigarette each year. In addition, cigarette sales are the number one in-store item for these stores, comprising about 34% of merchandise sales.
  
  

For detailed research on the continued rise of both federal and state tobacco taxes, download the 2007 Tax Burden on Tobacco (PDF) produced by Orzechowski and Walker.

After 10 years of huge tax increases, enough is enough.
Act Now. Don't let Government raise cigarette taxes yet again.