Hawaii Hikes Cigarette Tax

HONOLULU -- New cigarette taxes hitting Hawaii smokers last week made each pack cost 40 cents more, reaching an average of nearly $8 on the islands, according to a report by BusinessWeek.

The increase brings Hawaii to the No. 4 place for highest U.S. cigarette tax rates, at $3 per pack. New York, Rhode Island and Washington tax cigarettes more, the report stated.

The average cost of a pack of cigarettes in Hawaii is $7.79. The higher tax is expected to raise more than $20 million a year for the state government, BusinessWeek reported.

The new tax is one of 60 laws that went into effect last week, another being a jump in the cost of auto fuel, according to the report. The cost of auto fuel is expected to go up by roughly 2.5 cents per gallon, as a hike in the oil products tax, paid on every barrel of petroleum product, will likely passed on to consumers, the report stated. The law calls for the oil products tax to increase from 5 cents to $1.05 per barrel, generating about $22 million for the state.

Additional taxes affected large cigars.

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