A new study released by the Tax Foundation shows that over 60 percent of cigarettes are smuggled in to New York to avoid the state’s high cigarette taxes.
The smuggled cigarettes are usually transported from states with lower taxes on cigarettes.
New York State has some of the highest cigarette taxes in the nation with a tax rate in new York City currently at $5.85 cents per pack. The state rate is $4.35 per pack.
New York is ranked as the state with highest smuggling rate followed by Arizona, New Mexico, and Washington.
The study – which used data from the Mackinac Center for Public Policy think tank in Michigan – shows that smuggling rates tend to increase with high cigarette taxes. The study uses data from 2011.
“Public policies often have unintended consequences that outweigh their benefits,” said Tax Foundation economist Scott Drenkard in a statement. “Dramatic increases in state cigarette taxes have yielded additional revenue for priorities like public health, but have also fueled the rise of organized crime and law enforcement corruption.”