US: Retailers Say State will Get Burned on Indiana Cigarette Tax Plan

Source from:  Eagle Tribune 01/15/2016

Cheaper cigarettes are the lure for people in Illinois who cross the Wabash River to visit the Smoker Friendly tobacco outlets in Indiana.
But that won't be the case anymore, there or in other Indiana border cities, if lawmakers hike the state's tobacco tax by $1 to pay for road repairs, as House Republicans propose.

Darren Collett says his 28 Smoker Friendly stores will lose big to Illinois and Michigan, which now have higher taxes than Indiana's.

Raising the cigarette tax will extinguish the incentive for out-of-state smokers to cross the border to buy cigarettes, he and other retailers say.
Indiana's current tax of 99.5 cents per pack is 32nd highest in the country, according to the Federation of Tax Administrators. Michigan charges $2 per pack and　Illinois taxes $1.98.

The tax difference adds up for smokers who buy cartons at a time including John Fenner, a Michigander who drives to the Olde Tobacco Road cigarette outlet in Middlebury, 200 yards from the state line, for Kool Milds.

Fenner said he's resigned to a tax increase.

"Taxes are taxes, they are going to do it regardless if we care or not," he said.

Nearly doubling Indiana's tax, as some lawmakers want to do, would give the state the country's 17th highest cigarette tax. Enditem