Does New Hampshire really smoke like a locomotive?

The interesting graphic above details cigarette sales state by state between 1970 and 2012. While there’s no question smoking has declined in the US over the past 40-plus years, the trend has nuances not indicated in the chart.

If one looks at the map for 2012, the last year shown, cigarette sales are greatest in West Virginia, Kentucky and New Hampshire, with the three states registering 105, 100 and 94 packs sold per resident, respectively.

New Hampshire would seem out of place with Kentucky and West Virginia, two states located firmly in the Appalachians, where smoking is more accepted culturally in a region noted for its blue-collar lifestyle.

On the other hand, a significant portion of New Hampshire now serves as a bedroom community for Massachusetts’ white collar labor force, with the commensurate rise in housing bringing an increasing number of young middle- and upper-middle class individuals into the state, hardly the sort known for consuming large amounts of smokes.

However, it almost certainly wasn’t nicotine-frenzied Granite State residents alone that drove New Hampshire cigarette sales in 2012, but individuals from all of New England.

In 2012, a pack of cigarettes cost $4.86 in New Hampshire, compared to $6.97 in neighboring Maine, $7.60 in Vermont and $8.49 in Massachusetts. Prices were almost as high or even higher in the other two New England states: $8.16 a pack in Rhode Island and $8.85 in Connecticut.

Cigarette sales per capita, 2012.

Cigarette sales per capita, 2012. Click on to understand.

Factor in that New Hampshire has no sales tax and you had a happy hunting ground for those wanting to stock up on cheap cigarettes. And the difference in price made a short drive worthwhile: someone from Massachusetts, for example, who drove over the border to New Hampshire could save nearly $75 on just two cartons (20 packs) of cigarettes.

West Virginia’s average price for cigarettes in 2012 was $4.84 a pack, the lowest in the country. Prices in all neighboring states were higher: Virginia, $5.43; Ohio, $5.67; Maryland, $6.53; Kentucky, $6.56; and Pennsylvania, $6.93. It’s easy to see that residents in border states would likely at least partly drive up sales in a bid to save money.

Kentucky, however, is an outlier. Its price per pack wasn’t cheap – it ranked in the top half of the nation in terms of cost per pack in 2012 – so why did it come in second in per capita cigarette sales?

Looking at the cost of cigarettes in surrounding states, Tennessee, $4.91 a pack; Virginia, $5.43; Indiana, $5.56; Missouri, $5.87; and Illinois, $10.25, all but the latter are cheaper than Kentucky.

However, Kentucky had just seen prices spike due to increases in state and federal cigarette taxes, raising the cost per pack from $4.97 to $6.56.

While some Kentuckians may have been able to cross the border to buy less-expensive smokes in bordering states, it was likely inconvenient for others to do so, due to distance and terrain. And, of course, some people are going to smoke, no matter what the expense. Over time, Kentucky’s per capita rate will drop, but not into the range of, say California or Utah.

And it doesn’t matter how high the government raises cigarette taxes; at some point, smokers will simply begin buying tax-free bootleg smokes.

So while smoking is certainly on the decline in the US, trying to gauge the impact of tax increases on smoking on a state-by-state basis is an iffy proposition. Pushing up the price of cigarettes in one state may simply be driving at least a portion of consumers to surrounding states, particularly if prices are significantly lower.

(HT: Carpe Diem)

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6 thoughts on “Does New Hampshire really smoke like a locomotive?

    • Thanks – I’m always interested in unintended consequences. Editorial writers will point to a drop in cigarette sales following a rise in cigarette taxes and say “See, cause and effect,” without always considering that it’s not so cut and dried. I think it’s safe to say that at some point, just like with Prohibition here in the US, people will more and more simply start smoking untaxed cigarettes. Some will certainly use the motivation of increased costs to quit, but others are going to smoke come hell or high water.

  1. Cool graphic! I went to college in Southern Illinois in the late 90s and I remember making runs into Kentucky to buy cheaper cartons of cigarettes to send to my now brother-in-law in the Navy.

    • I don’t know what the price difference was in the late ’90s, but I’ve got a feeling it was significant even back then. When my mom used to smoke, she’d always buy a couple of cartons when she’d visit me in S.C. from California. She’s realize a big-time savings.

  2. I found it interesting that prices differ from state to state. Does this occur with all things? Here in the Uk the only price wars we have is with the big four supermarkets, competing for our custom!

    • Yes, it happens with things such as tobacco, gasoline (wild variations in prices due to taxes and gasoline ‘blends’) and alcohol.

      Prices on items that states tend to heavily tax vary from state to state, since different states impose different rates. One of the famous arguments lawmakers use when they want to raise a certain tax is to show how their state ranks near or at the bottom, and that their state needs raise the rate to keep up with other states.

      Of course, it just keeps the taxation cycle going, since it means someone else will now be at or nearer to the bottom.

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