Illinois State Senator John Cullerton, D-Chicago, has announced plans to introduce legislation that would increase the state’s tobacco tax, including nearly doubling the state’s cigar tax, adding $1 to every pack of cigarettes sold, and implementing a tax on e-cigarettes.
Cullerton, who is also president of the Senate, announced his plans on Tuesday, calling to raise the OTP tax from 36 percent of the wholesale price to 64 percent.
In the case of a cigar with an MSRP of $9.50, the current rate means it costs approximately $12.92 at the register by halfwheel estimates, and that’s before sales taxes are added. Under Cullerton’s proposal, that same cigar would cost $15.58 before sales taxes.
Under Cullerton’s proposal, e-cigarettes, which are currently only subject to sales tax, would also be subject to the 64 percent rate, while cigarettes would go from $1.98 to $2.98 per pack. The legislation has yet to be formally filed, though that is expected in the coming weeks.
Cullerton’s proposal has already received the support of Gov. J.B. Pritzker, who called for a more modest 32-cent per pack increase in his budget earlier this year. Both legislators were supporters of the state’s increase of the minimum purchasing age for tobacco products from 18 to 21-years-old, which was signed into law in April and will go into effect on July 1.