As you probably know, I recently moved to Rhode Island after spending most of my time in the states of Georgia, Virginia, and North Carolina. Now, you might not think about it, but those latter three states grow a lot of the country’s tobacco. As a result of that, and extraordinary lobbying efforts, the state taxes on tobacco are relatively low in those places. In fact, they are three of the lowest in the nation. In Virginia, the tax is 30 cents per pack. In Georgia, it’s 37 cents. In North Carolina, it’s 45 cents. (For a great map of tobacco tax rates, go here.) By contrast, in Rhode Island, which doesn’t really grow tobacco, the tax is $3.46 per pack. That’s more than 10 times the rate in Virginia.
Not surprising is that the per pack tax gets passed on to the consumer. So, in Georgia, I’ve seen cigarettes sell for about $3 a pack or so. When I was in CVS last week, I noticed behind the counter that Rhode Island cigarettes sell for closer to $8 a pack. A big chunk of that difference is obviously the different state tax.
But here’s the funny thing: I ride the bus to work every day from a fairly “blue-collar” part of the state, and I often overhear people trying to bum cigarettes off of fellow passengers. In fact, while I don’t smoke, someone asked me for a cigarette a couple of weeks ago. But in most cases people ask people who visibly have at least one cigarette on their person. I’ve yet to observe someone happily sharing a smoke with a stranger. If memory serves, bumming cigarettes had a much higher success rate in the tobacco friendly states where the per pack cost was much lower. In effect, the “charitable” act of giving someone a cigarette is more expensive here than it is down south, so people do it a lot less often. It’s pure economics. Well, that, or a lack of hospitality. This is Yankee country after all.