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CCH Compares States' Tax Rates July 5, 2007 (SmartPros) The annual CCH survey of gas, sales and cigarette taxes finds most states have held firm on gas and sales tax rates. However, in contrast, many smokers are feeling a greater squeeze on their wallets as more states increase cigarette taxes. State per-gallon gasoline taxes range from a low of 7.5 cents in Georgia to a high of 36 cents in Washington, which raised its gas tax 2 cents from last year. In more than half the states, the rate is 20 cents per gallon or less. But many drivers actually pay more than that basic rate when they pull up to the pump. Taxes and fees related to environmental impact, licenses and inspections may also be passed through at the pump to consumers in a number of states. New York drivers, for example, contribute considerably more to the state treasury than their state's 8-cent gas tax for every gallon of gas they buy. In addition, some states collect regular sales tax on top of the gasoline tax, and, in Hawaii, local taxes in each of its counties can more than double the basic 16-cent-per-gallon state rate. Sales taxes are major money-raisers for the states that have them, and are often an important funding source for cities and counties, as well. Five states -- Alaska, Delaware, Montana, New Hampshire and Oregon -- impose no sales tax. Of the remaining states, Colorado is at the bottom of the scale with 2.9 percent while four states -- Mississippi, New Jersey, Rhode Island and Tennessee -- are at the top of the list with a 7-percent rate. Among states with a sales tax, more than half have rates of 5.5 percent or more. The greatest variation among the states is seen in cigarette taxes. Traditionally, the per-pack tax in tobacco-raising states has been negligible, but South Carolina is now the only state with a tax rate below 10 cents, charging just 7 cents a pack in taxes. Ten states are charging higher rates this July than last. Most states now have rates over 80 cents per pack, while 21 states charge a dollar or more per pack and eight charge $2.00 or more per pack, with New Jersey's $2.575 per pack, or $25.75 per carton, the highest rate. A national map of tax rates shows just how varied the rates are in each category across the United States, with rates that range from high to low, or even non-existent, as of July 1, 2007. 2007 SmartPros Ltd. All rights reserved. |
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