Cigar Libre

Image courtesy of Wikimedia Commons

With more than $620 million missing from their budget, New York scrambles to fill in missing gaps with tax hikes on, of course, cigars. Currently, tax rates for cigars are 46% of wholesale prices, but under new plans the state will raise tax rates to an astounding 90% of wholesale price. Cigarettes, little cigars, and snuff are not to be missed, and each of these will carry tax hikes too.

New York tobacco shops and tobacconists fear the tax hikes will drive consumers to search for cheaper prices across state lines or on the Internet. Although the proposed cigar tax hits every tobacco seller, the smaller businesses stand to lose it al. Cigar shops who have been hand-rolling cigars, family owned businesses, and the cigar shop down the street all face uncertain futures  as legislature rushes to tie loose ends in the state budget. Major arguments against the tax increases include those that point out that tax increases put the crunch on consumers who turn elsewhere to purchase their products, which in the end puts companies out of business. New York government is urged to reconsider the tobacco tax hikes and search elsewhere for budget bailouts that don’t provide band-aid solutions. For more reading on the subject, visit PRWeb for more info.

In the face of a tough economy, states across the country are in similar positions as New York. With decreased federal funding these states are on their own for fundraising efforts. If you live in New York, or any other state that has imposed tax increases on your stogies, how have you been coping?