Missouri's Cigarette Tax Now Lowest in U.S.

With South Carolina's new cigarette tax slated to go into effect July 1, Missouri will now be the state with the lowest tax rate on cigarettes, at 17 cents per pack.

South Carolina had held the title with its 7-cent per-pack tax rate until last month, when the state's lawmakers overrode a veto by Gov. Mark Sanford and raised the tax 50 cents per pack, bringing the total state excise tax (SET) on cigarettes to 57 cents a pack. South Carolina's tax rate had been in place since 1977.

Sanford had argued any bill regarding an SET increase would also have to include a tax relief element.

"In these difficult economic times," Sanford said when vetoing the measure, "we believe it would be sheer folly to impose the largest tax increase since 1985."

Opponents in South Carolina also argued it would hurt businesses that sell cigarettes, especially along the state border, as Georgia's SET on cigarettes is 37 cents per pack, while North Carolina's is 45 cents.

South Carolina's increase is expected to raise nearly $125 million for the state's Medicaid program and other health-related projects, according to published reports.

Missouri, with an SET of 17 cents per pack, is followed by Virginia at 30 cents per pack. The national average state cigarette tax is $1.34, and Rhode Island, at $3.46 per pack, has the highest tax.
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