The Metropolitan Cigar Society.

Tobacco Taxes New Jersey's excise tax per pack of cigarettes: $2.400 New Jersey's excise tax collection for the fiscal year ending June 2002: $396,183,000 Sales tax on tobacco products: 6.00% Federal excise tax per pack of cigarettes: $0.39 Total federal excise tax collections in fiscal year 2002: $7,512,700,000

Who Profits from Cigarette Sales? click for larger view

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Number of six-packs of beer that must be sold in New Jersey to produce the same state excise tax revenue generated by one carton of cigarettes: 222.2

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Number of bottles of wine that must be sold in New Jersey to produce the same state excise tax revenue generated by one carton of cigarettes: 108.2

New Jersey Smokers' Contributions
to the State Economy - FY2005

In 2004, New Jersey smokers comprised only 18.8% of the adult population in the state.  Here is what they already pay because they choose to buy a legal product:

• Smokers Pay Excise Taxes                                                                                    $780,657,000


• Smokers Pay Sales Taxes                                                                                      $119,337,000


• Smokers Pay Tobacco Settlement Payments                                                      $243,800,000

                                                                                                                                            $1,143,794,000

Smokers’ Economic/Tax Profile 2004

·         Income

Ø      New Jersey smokers’ median household income                                                       $44,926

Ø      New Jersey nonsmokers’ median household income                                                 $57,910

·         Smoker excise tax/sales tax/tobacco settlement payments liability in FY2005

Ø      Total average paid per New Jersey smoker in excise and sales taxes                         $757

Ø      Cost per New Jersey smoker for settlement payments to New Jersey                         $205

Total annual payments to New Jersey per smoker                                               $962

 Total annual payments to New Jersey per nonsmoker                                            $0

New Jersey Smoker Facts

·         Total smokers’ payments in New Jersey in FY2005 were:

Ø      Nearly 13 times as large as state excise taxes on alcoholic beverages in FY2005 ($88.4 million).

Ø      Larger than FY2005 Motor Fuels Tax and Petroleum Products Gross Receipts combined ($795.8 million).

Ø      Larger than revenues in the State Lottery Fund ($839.4 million).

Ø      Larger than revenues in the Casino Revenue Fund ($619.2 million).

·         New Jersey FY2005 smoker payments were large enough to pay for FY2005 expenditures on:

Ø       Law Enforcement ($344.1 million)  AND   Mental Health Services ($640.4 million)

OR

Ø      Detention and Rehabilitation ($908.9 million)

OR

Ø      Economic Assistance and Security ($593.8 million)  AND   Community Development and Environmental Management ($385.5 million)  AND  Juvenile Services ($112.8 million)

OR

Ø      Health Services ($235.2 million)  AND  Rutgers University (Grants-in-Aid - $327 million).

TOTAL SMOKER CIGARETTE PAYMENTS TO NEW JERSEY FY2005 Per year:        $1,143,794,000 Per day:          $       3,131,537 Per hour:        $          130,481 Per minute:    $              2,175 Per second:   $                   36

 

New Jersey Smokers' Contributions
to the State Economy - FY2003

Smokers Pay Excise Taxes2	$	612,090,000
Smokers Pay Sales Taxes2	$	73,451,000
Smokers Pay Tobacco Settlement Payments3	$	280,070,000
	$	965,611,000

• Income1

New Jersey smokers' median household income	$	48,990
New Jersey nonsmokers' median household income	$	52,527

• Working Families Pay More1

25% of New Jersey smokers had household income LESS THAN $25,000




28% of New Jersey smokers had household income EQUAL TO or GREATER THAN $75,000




The impact of smoker payments on the incomes of working families was more than THREE TIMES the impact on higher income smokers. Those who can afford it least pay a disproportionate percentage of their hard-earned income in smoker payments.

• Smoker excise tax/sales tax/tobacco settlement payments liability in 20024

Total average paid per New Jersey smoker in excise and sales taxes	$	567
Cost per New Jersey smoker for settlement payments to New Jersey	$	232
Total annual payments to New Jersey per smoker	$	799
Total annual payments to New Jersey per nonsmoker	$	0

New Jersey Smoker Facts 5

• Total FY2003 smokers' payments to New Jersey were:
  
  
  
  • Eleven and one-half times as large as state excise taxes on alcoholic beverages ($83 million).
    
  • Larger than motor fuels tax and petroleum products gross receipts taxes combined ($745.3 million).
  
  
• Total FY2003 smoker payments were large enough to support FY2003 Direct State Services for:
  
  
  
  • Department of Corrections ($833.6 million)
    -OR-
    
  • Department of Human Services ($671.9 million)
    -OR-
    
  • Department of Law and Public Safety ($527.5 million).
    
  
  
• Total FY2003 smoker payments were large enough to support FY2003 Grants-in-Aid, general fund expenditures to:
  
• Rutgers University ($317.8 million) -AND- Student Aid Scholarships and Grants ($223.4 million) -AND- Mental Health Services ($214 million) COMBINED.

TOTAL SMOKER CIGARETTE PAYMENTS TO NEW JERSEY FY2003   Per year: $ 965,611,000 Per day: $ 2,643,699 Per hour: $ 110,154 Per minute: $ 1,836 Per second: $ 31

CIGARETTES DON'T PAY TAXES -
NEW JERSEY SMOKERS DO!!

1 Centers for Disease Control's Behavioral Risk Factor Surveillance System, 2002
2 Orzechowski & Walker, Arlington, Virginia; from state revenue department.
3 PriceWaterhouseCooper
4 U.S. Census Bureau, 2000 state population and Centers for Disease Control's Behavioral Risk Surveillance System, 2002
5 Tax and budget Comparisons are from the New Jersey Treasury, Office of Management and Budget, Fiscal Year 2005 Budget in Brief, Online at http://www.rjrt.com/common/pages/LeavingRJRT.asp?URL=http://www.state.nj.us/treasury/. Note: Grant-in-Aid funds are for programs provided to the public by third parties on behalf of the State, or directly to individuals based on program eligibility criteria.

 

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Master Settlement Agreement Payments To Date

$916,790,605 has been paid to New Jersey since the Master Settlement Agreement was signed on November 23, 1998.

 

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New Jersey Tobacco Laws

A summary of New Jersey state law is provided below
(for specific questions regarding state law, contact your legal advisor.)

Minimum Age	Customers must be 18 years or older to purchase tobacco products.
Restricted Products	Tobacco in any form, including smokeless. Any other matter or substance which can be smoked and cigarette papers are also restricted.
Acceptable Forms of Identification	A driver’s license or non-driver identification card issued by the Division of Motor Vehicles in the Department of Transportation, or a similar card issued pursuant to the laws of another state or the federal government of Canada.
Fine/Penalty Schedule for Selling to Minors	Violators shall be charged as a petty disorderly person and are subject to a fine of up to $500 for the first violation and up to $1000 for subsequent violations. In addition, a retailer shall be liable for a civil penalty of not less than $250 for the first violation, not less than $500 for the second violation, and $1,000 for the third and each subsequent violation. Upon the recommendation of the municipality, following a hearing by the municipality, the Division of Taxation may suspend or, after a second or subsequent violation, revoke the license of a retail dealer. An adult who purchases a tobacco product for a minor will be charged as a petty disorderly person.
Affirmative Defense	It is a defense that the purchaser or recipient of the tobacco product falsely represented, by producing a photo ID, that the purchaser or recipient was of legal age to make the purchase or receive the sample; that the appearance of the purchaser or recipient of the tobacco product was such that an ordinary prudent person would believe the purchaser or recipient to be of legal age; and that the sale or distribution of the tobacco products was made in good faith.
Minor Possession	State statutes do not specifically prohibit possession by a minor.
Sign Requirement	A sign must be posted at the point of display and at the point of sale. Signs must be at least 6 inches x 3 inches and in bold letters at least one-quarter inch high state: A PERSON WHO SELLS OR OFFERS TO SELL A TOBACCO PRODUCT TO A PERSON UNDER 18 YEARS OF AGE SHALL PAY A PENALTY OF UP TO $1000 AND MAY BE SUBJECT TO A LICENSE SUSPENSION OR REVOCATION. PROOF OF AGE MAY BE REQUIRED FOR PURCHASE.
Compliance Checks	As a condition of receiving federal substance abuse block grant funds, federal law requires the State of New Jersey to conduct random, unannounced inspections of tobacco outlets to determine compliance rates. The Commissioner of Health and Senior Services coordinates the inspections. The New Jersey Tobacco Age of Sale Enforcement [TASE] project is conducted by the New Jersey Department of Health and Senior Services (DHSS) – Division of Addiction Services (DAS) and local health departments (LHD). Minors used in this program are supervised and accompanied by an inspector from the LHD or DAS.
DISCLAIMER: This information summary is provided as a service of the Coalition, but is not intended to provide legal advice or analysis. These summaries are not intended to be complete representations of state law, which may contain additional rules and restrictions relating to tobacco products not mentioned in this summary, as well as retailing prohibitions related to matters including, but not limited to, state required training, minimum pack size, the sale of loose cigarettes and other restrictions. Retailers should not rely on these summaries as complete or accurate descriptions of applicable federal, state or local law. Users with questions about the law should seek the advice of counsel. Each state law is unique and possibly represents multiple legislative or regulatory acts. Local laws may differ. Check with local authorities for variations from state law. These summaries are not intended to be complete representations of state law.

The reprinting of this information from the Coalition, does not constitute a representation or admission by RJRT that such information is accurate, complete, or a proper characterization of the laws concerned. The Coalition for Responsible Tobacco Retailing is a cooperative effort among retailers, wholesalers and manufacturers who share a common goal: to do all they can to prevent tobacco sales to minors.

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