That's not to say that smokers won't react to incentives. They'll go to the cheapest outlets to buy smokes, even when those outlets are out of state. The Centers for Disease Control reported two years ago that adult smoking rates in Massachusetts and New Hampshire were the same. But it noted that the rate of cigarette purchases was more than double in New Hampshire - 158 packs a year in New Hampshire, compared with 78 in Massachusetts. Massachusetts' higher taxes.
Smuggling enters the picture.
Canada's experience has shown that soaring tax rates drive customers underground. Canada rolled back many of the recent hikes. Closer to home, New Jersey doubled its per-pack tax to 80 cents at the outset of this year. The move sent cigarette buyers west to Pennsylvania. So higher taxes on smokers won't have a big effect on smoking.