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CHICAGO–The President of Taxpayers United of America (TUA) today condemned the Civic Federation’s recommendation that the state tax on a pack of cigarettes be raised $1-a-pack. “Not only would such a huge tax increase be counterproductive, but this high regressive tax would drive many small stores out of business, especially minority businesses that are barely surviving in this recession,” said Jim Tobin, TUA President.
“Illinois’ state tax on cigarettes was increased from 58 cents-a-pack to 98 cents-a-pack in 2002. An even larger tax increase is the last thing Illinois needs now.”
“Most tax increases on tobacco have actually resulted in decreasing rather than increasing revenues, as smokers travel to municipalities with lower taxes, or buy cigarettes on the black market,” said Tobin.
“Rising cigarette taxes also have been accompanies by a sharp increase in illegal trafficking of contraband cigarettes. Low-income people who smoke have gotten poorer as criminals engaging in cigarette smuggling have gotten richer.”
“The recommended tax increase per pack will result in such a high tax burden in Cook County and Chicago that it will drive sales to neighboring municipalities in Northeastern Illinois.”
“Of the 57 state excise tax increases between FY 2003 and FY 2007, only 16 met or exceeded projected revenues. In the other instances, states fell short of projections by as much as 181 percent.”
“The state should slash its out-of-control spending and cut taxes, not raise them,” said Tobin.
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