The state tax on cigarettes would double to $4 for a pack under a measure recommended by the majority of the legislature’s Taxation Committee.
The measure would increase the taxes on all tobacco products as well as cigarettes, and direct some of the $17 million in annual revenue to fully fund the state’s tobacco cessation programs. Supporters, including Democratic state representative Lori Gramlich of Old Orchard Beach claim higher taxes will result in fewer smokers.
State law mandates that when cigarette taxes are increased, taxes on all other tobacco products, including moist snuff and vapor products must also be increased by the same percentage. So, the increase in the cigarette tax means the taxes on both moist snuff (oral tobacco) and vapor products are also doubled. This makes the tax on all e-cigarette or vapor products 86 percent of their wholesale cost: the second highest tax on nicotine vapor products in the country.
Opponents argue that raising the tax on tobacco will not discourage use, but will likely create a black market for tobacco products in Maine. A 100 percent increase in taxes on all tobacco products could drive smuggling of cigarettes into Maine. New Hampshire, reaps tens of millions of dollars in tobacco tax revenues from cigarettes purchased there and carried to neighboring states. If LD 1423 becomes law, the disparity in the price of a pack of cigarettes in Maine versus New Hampshire will be more than $2 per pack.
