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N.J. Seeks Higher Tobacco Tax

TRENTON, N.J. -- New Jersey could be joining a number of other budget-weary states that are looking at tobacco to bail out funding shortfalls.

Democratic Gov. James McGreevey has proposed increasing the state tax on a pack of cigarettes by 50 cents to $1.30, a move that would generate $200 million in revenue, to help plug an anticipated budget hole of $2 billion.

Recently boasting a surplus in excess of $1 billion, the state has seen its revenues drained in the past couple of years, crippled by the economic recession and the aftershocks of Sept. 11's terrorist attacks against the World Trade Center.

McGreevey's proposal represents a 3.24-percent increase over the current spending plan adopted last summer by the GOP-led Legislature.
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