Cigarette taxes in N.J. sending smokers to Delaware (going up to $2.50 verus 55 cents in DE)

wmdt.com ^

[chance33_98]

Cigarette taxes in N.J. sending smokers to Delaware—

(New Castle-AP) -- Delaware is reaping the benefit of New Jersey's higher cigarette tax. New Jersey is considering raising its cigarette taxes for a third straight year, hiking the tax by 45 cents to 2-dollars-50 cents a pack.

Delaware retailers says the taxes are already sending New Jersey residents across the river to Delaware, where the tax is 55 cents a pack.

The manager of the Delaware Cigarette and Tobacco Outlet in New Castle, Shirley Legeza (le-GAY-za), says her New Jersey customers buy as many as 30 cartons at a time because they can save up to 25 dollars a carton. But she adds that customers are worried they'll be caught smuggling cigarettes over the state line.

[greasepaint]

Could someone PLEASE respond as to what these
stores have as their posted price.
Why does something that cost 25 cents to make,
and has 'publicly known excise taxes', ....
cost so much.
Numbers, please.
Numbers, please.

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[Gabz]

I don't have the NJ or Delaware numbers at my fingertips, but I do have an average break down for a regular pack of cigarettes (marlboro or winston, not a generic)in virginia, had the governor's proposed increase been enacted (it wasn't) but this is a pretty good example.

93 cents.... VA sales and excise taxes
86 cents..... Other government taxes and fees, including MSA
$1.60........Manufacturer's cost
62 cents.....Average wholesale/retail markup
11 cents......manufacturer's profit

total $4.12


Hope that helps a little bit.

[DumpsterDiver]

Is something like this what you're looking for?

State Tax Rates on Cigarettes
January 1, 2004
http://www.taxadmin.org/fta/rate/cigarett.html

[Gabz]

Northern Delaware cigarette outlets have been making a killing for years because of the much higher taxes in the surrounding states.

You can buy them cheap in Delaware.....you just can'smoke them anywhere.

[greasepaint]

Gabz
two comments...
$1.60.., XYZ Cancer Sticks ,Inc., needs to move it workforce
and lawsuit liability, offshore
62 cents, does Walmart know about this?
.
Why is there NO competition?
Somebody, fight back

[Gabz]

That's a good chart.

after adding in the federal tax of 39cents, the MSA paypment of 45cents and the various state and local sales taxes per pack.....on average the various government take is about 43% of the price of each pack of cigarettes.

Of course they will never be forbidden.....governments can't take that kind of a hit in lost revenues.

[Gabz]

There is competition. however, the Big manufacturers, in collusion with the state's attorneys general are doing their dangest to shut it down. They are trying to force the smaller, and newer, companies to pay into the Settlement agreement.

The little guys are fighting back as much as they can....but they have neither the money of the big boys or the government backing the big boys have.

When I am not making my own cigarettes, the brand I buy is only $9.50 a carton including all of the taxes.

[DumpsterDiver]

...after adding in the federal tax of 39cents, the MSA paypment of 45cents...

There was an article a couple of weeks ago where the former Surgeons General wanted to raise the fed tax by $2.00 per pack!

What does MSA stand for?

on average the various government take is about 43% of the price of each pack of cigarettes.

Good grief!

Of course they will never be forbidden.....governments can't take that kind of a hit in lost revenues.

Is there anything worse than a politician's addiction to other peoples' money? They all belong in rehab. :-)

[Gabz]

What does MSA stand for?

The Master Settlement Agreement that was reached in 1998 between the big 5 manufacturer's and the AGs of 46 states.

Under the agreement the companies will pay the various states some $215+ billion over 25 years....and be protected from future lawsuits. Of course the agreement specified that the manufacturers were to pass on the cost of the entire agreeement to their customers to the tune of about 45cents per pack.

As sales of cigarettes and market share of the Big 5 decrease in states, the proportion of settlement money also decreases. This is why so many states are trying to either tax or get rid of internet and Indian reservation sales of cigarettes, and force the new smaller companies to start paying into the settlement.

[aristotleman]

Taxachusetts: $5.89-$6.50. Costs me $150 a month to smoke. I've been saying that they can't force me to quit with their insane tax policies, but it's getting ridicilous.

[CSM]

Let me restate the numbers to more accurately show the ratio taxation.

Actual cost for mfg, mfg profit and value chain= $2.33

Taxes cost $1.79

The actual tax rate is 1.79/2.33 = 76.8%

Looks like we need a tobacco party!

[Gabz]

I've got my seeds started in flats..........just waiting for the ground to dry out and warm up enough to till and plant!!!

[greasepaint]

How much does cig tobbacco cost,
perhaps ten bucks for 600 smokes?

[Gabz]

I've been paying about $12.50 a pound, which makes 3 carton (600 cigarettes)

And another $6 or so for the tubes.

Over time we have averaged between $6.50 and 8.00 a carton.


Additionally they don't have all the chemical additives in them that the manufacturers use, so they have a smoother flavor and don't burn up as quickly. since we started making our own I have learned that I never smoked nearly as much as I thought......they just burned up so much faster it seemed I was smoking more.

[Chewbacca]

If the tax is on a pack of cigarettes and not on each individual cigarette, why don't the tabacco companies just SUPER SIZE the packs.

Double the number of cigarettes per pack. It would actually cut the tax per cigarette in half.

Keep the same number of packes per carton, and sell at half the cost.

[Just another Joe]

I use an expensive tobacco and still stuff mine for about $17 a carton.
So smooth they could kiss your wife and you'd never notice.