Indiana Eyes Cigarette Tax Hike – Will it Deter Michigan Smokers from Crossing the State Line?
Visit the Indiana border from Michigan and you're likely to find tobacco and fireworks stores as soon as you cross that state line. However Indiana is considering a hike in the state's cigarette tax - would it deter Michigan smokers from crossing the border for smokes?
A group called Raise It for Health Coalition is pressuring the Indiana legislature to bump the state's tax by $2 per pack. The South Bend Tribune reports via the Associated Press:
Indiana has one of the nation's highest smoking rates, with 1 million Hoosiers smoking every day, but its 99.5 cents a pack cigarette tax is the nation's 14th-lowest.
The coalition argues that raising that tax is the simplest and most effective way to reduce smoking rates and improve Indiana's health.
That low tax-per-pack rate in Indiana is a full dollar less than the excise imposed by Michigan at $2 a pack and the reason so many Michiganders in reach of the border choose to cross the state line for cartons.
Should the proposed Indiana tax hike go into effect, the new rate on smokes in the Hoosier state would be $2.99 per pack, nearly a dollar higher than Michigan.