When Maryland doubled the cigarette tax to $2 a pack, some residents may have found a reason to quit. Smugglers, on the other hand, seem to have found a motive to step up their activities.
Since the tax increase took effect in January, agents with the Maryland Comptroller's Office have seized more than 46,000 packs of contraband cigarettes - smokes brought illegally across state lines. That's a nearly four-fold increase from about 13,000 packs seized over the same period in 2007.
And in the largest bust so far this year, agents confiscated nearly 8,000 cigarette packs after stopping a man driving a Chevrolet Astro van on Interstate 495 this month.
State officials say they would be hard-pressed to blame the sharp rise in smuggled smokes solely on higher taxes, but they suspect that the levy is a factor. Maryland has one of the highest tobacco taxes in the nation; neighboring states have some of the lowest.
Virginia's levy, for instance, is 30 cents a pack. That means a carton in the Old Dominion is $17 cheaper than in the Old Line State, creating an opportunity for smugglers to make a quick buck by selling out-of-state cigarettes here.
"It's just become even more profitable for smugglers now," said Jeffrey A. Kelly, director of the comptroller's field enforcement division, adding that his agents on surveillance duty also have spotted more Maryland residents in Virginia buying cigarettes.
The fallout from raising the tobacco tax was the subject of much debate in the Maryland General Assembly.
During a special legislative session last year, Gov. Martin O'Malley proposed raising a number of taxes, including the tobacco tax, as part of a broader package to plug a $1.7 billion budget shortfall. Proponents of boosting the tobacco tax said it would improve public health and discourage smoking, particularly among teens.
But opponents argued that the higher cigarette tax would hurt mom-and-pop businesses near borders with other states and would help to foster a black market and encourage cross-border smuggling.
"The Democrats in their zeal to raise taxes on cigarettes have driven Lord knows how much commerce across the boarder," said Del. Anthony J. O'Donnell, the House minority leader from Southern Maryland.
"The tax increases are going to hurt us in ways we haven't even contemplated yet. We're just starting to see ways we knew they would have an impact."
