Government Bytes


Will New Hampshire finally cut its cigarette tax?

by John Stephenson / /

New Hampshire may finally realize what NTU and others have been saying for a while now: high cigarette taxes are not good public policy. The powerful NH House Committee on Ways and Means is considering a bill, HB 156, which would cut the cigarette tax by 10 cents and the wholesale tax on other tobacco products by 17 percent, reducing a regressive tax burden on the poor and small businesses. Earlier today, I squeezed into a packed committee room at the Legislative Office Building in Concord to testify in person in favor of this legislation. You can find my written letter to the committee here

As I stated in my testimony, "Since the poor are more likely to smoke,New Hampshire’s low-income families, especially those who live in the depressedNorth Country, have disproportionately felt the pinch of cigarette tax hikesover the years. A 2007 study by the Heritage Foundationshowed that more than one-fourth of people who smoke live below the federalpoverty line and another quarter of all smokers live within 100-200 percent ofthe poverty line. Reducingthe cigarette tax will help alleviate the tax burden on these families, whostruggling to get by in a tough economy."

Reducing the tax burden on cigarettes will not only help low-income families, but also help retailers, which will benefit the state in general. As I mentioned earlier today, "Salesof cigarettes and other tobacco products also comprise a substantial portion ofbusiness for small retailers. The National Association of Convenience Storesreports that cigarettes account for about one out of every three dollars oftotal sales nationwide at their establishments. Reversing some of the harmfultobacco tax hikes of recent years could help these businesses attract some ofthe consumer activity that may have migrated across state lines to stores inMaine and elsewhere."

Odds for passing the legislation looked good at the hearing today. The bill's sponsor is the chairman of the House Revenue Committee, which writes the state budget. Plus, the bill has attracted a number of consponsors. But only you can guarantee this bill passes by contacting your New Hampshire state legislators and urging them to support this long-overdue legislation. Click here to find your Representative.