New Jersey exports more cigarettes than it imports, ranking 31st in cigarette smuggling in 2017, according to a recent report from the Tax Foundation.
While New Jersey has the ninth highest cigarette tax in the nation, more cigarettes smoked in the state were bought here than purchased elsewhere and brought into New Jersey, the report found. And roughly 1% of the smokes purchased here wind up being brought into other states.
The state’s cigarette excise tax of $2.70 per pack is higher than most other states, but it is significantly lower than New York’s highest in the nation $4.35, which makes it likely that New Yorkers are smoking Jersey cigarettes. New York is the highest importer of smuggled cigarettes in the nation, with more than 55% of all smoked in the state brought in from other states. (In addition to its excise tax, New Jersey has a 50-cent sales tax on cigarettes, bumping the total taxes per pack in the Garden State to $3.20.)
“One notable consequence of high state cigarette excise tax rates has been increased smuggling as people procure discounted packs from low-tax states and sell them in high-tax states,” the report states. “Growing cigarette tax differentials have made cigarette smuggling both a national problem and, in some cases, a lucrative criminal enterprise.”
New Jersey used to be an importer: In 2016, more than 38% of cigarettes were smuggled in, according to the report. But most other northeastern states have higher taxes than New Jersey’s, including Connecticut’s $3.90, Rhode Island’s $3.75, Massachusetts’ $3.51 and Vermont’s $3.08.