N.H. House Votes Cigarette Tax Decrease to Senate

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N.H. House Votes Cigarette Tax Decrease to Senate

By Melissa Kress, Convenience Store News - 03/18/2011

CONCORD, N.H. -- A bill to decrease the New Hampshire cigarette tax by 10 cents is now heading to the Senate after the House voted overwhelming in favor of the cut. The decrease would drop the price of a pack of cigarettes from $1.78 to $1.68.

"We are still cautiously optimistic," John Dumais, president and chief executive officer of the New Hampshire Grocers Association told CSNews Online.

The House members approved the bill 236 to 93 on Thursday morning. They held the bill for third reading until later in the day to decide if the measure would move directly to the Senate or if the House would hold it for further review at the end of the current session -- a move it has been making with bills that would affect the state's revenue stream.

Next up is the Senate Finance Committee. Dumais said he expects to testify at the committee's public hearing on the issue, although no date has been scheduled as of yet.

Earlier this year, the New Hampshire Grocers Association had commissioned an economic study to review the impact of lower the cigarette tax. The study, which was conducted by Dr. Gregory Randolph and Dr. William Tasto, both economic professors at Southern New Hampshire University, and William D. Keip of Keip Government Solutions, found that reducing the state's cigarette excise tax by 10 cents per pack would generate up to $13 million in additional tax revenue for the state, as CSNews Online reported in February.

"With a lower cigarette tax you may lose some state revenue from tobacco only but that will be offset by increased revenue from other commodities," Dumais explained. "At the very least it is a neutral situation, and at best it is an enhancement of other goods and services." "In general, these legislators understand that consumers just don’t go into a store and buy one thing, like cigarettes, they go in and buy several items," he added.