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Illinois Cigarette Taxes Raised a Buck

Photo By: Phil Walters/Getty Images

Let me start out by saying I don’t smoke and right now I am really glad I don’t.  Effective yesterday (June 24) the new Illinois tax rate on cigarettes went up one dollar a pack.

The State of Illinois is strapped for cash and recently passed legislation to increase the state’s tax on a pack of cigarettes from 98 cents to $1.98 in hopes of generating more revenue for the state.  That’s the concept, but the reality of this is that people will find a way around it.  Look at the tax rates of the neighboring states for Illinois.  Indiana’s is 99.5 cents a pack. Kentucky is 60 cents a pack, Iowa is $1.36 a pack, and Missouri is only 17 cents a pack (the lowest in the nation). The only border state higher than Illinois is Wisconsin at $2.52 a pack.

If you live in a neighboring state you will just  head across the border and buy your cigarettes, especially those in Western Illinois with Missouri so cheap and close by. Look for more “Smoke Shoppes” opening at a border state near you.  That also hurts the convenience stores who also sold milk, bread and other commodities.  So down go their sales as well. With tax money associated with those purchases there will be another loss of revenue for the state.

Seems to me that the people in central Illinois (Springfield, Peoria, Bloomington, etc.) with no border state near them will be the ones who get hit the hardest.  The only positive to me is that maybe some people will give up the habit altogether and that would be a good thing. For those who continue to smoke look for the Bayview and Mark Twain Bridges to see additional traffic from here on.

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