Tobacco Documents Online

f A-11SS WILUAM G. MII.UKEN, Governor t.OREN E. MONROE. Stau Trea.ur.r STATE OF MICHIGAN DEPARTMENT OF TREASURY TREASURV IUIIDING LANSJNG, MICHIGAN •d922 August 15, 1980 Mr. Sunny Fong Chief of Health Education •Department of Public Health 3500 N. Logan Lansing, Michigan 48909 Dea r Mr. Fong : , r , . State Treasurer Loren Monroe has asked me to respond to Dr. Reizen's letter of July 23, 1980 concerning the proposal of the Governor's Citizens' Panel on Smoking and Health. From the standpoint of this department the proposal to increase the cigarette tax by five cents presents no great problem. It is no more complicated to collect 16 cents per pack than 11 cents. There may be some trend toward an increase in bootlegging activity as the result of an increase. Our.present rate of tax is below the median for all states and naturally bootleggers want to sell their goods in the states where it commands the higher price. Recent federal legis- lation making it a federal offense to move a quantity of cigarettes from one taxing jurisdiction to another without proper authorization has re- duced our bootlegging problem to almost nothing. The potential gain is apparently not worth the risk. For your information I am enclosing some literature which you may not have had available for the panel during its deliberations. Included is a map which lists, among other data, the cigarette tax in effect in each of the 50 states as of July 1, 1980. There are also two issues of the Tax Administrators News containing articles relating to cigarette con- sumption and tax data. You may be able to find some correlation between the tax rates and usage in the various states. If I can help further let me know. R. Douglas Trezise Deputy State Treasurer ROT:c enc. cc: Dr. M. Reizen Loren Monroe -238-