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Smoke ‘Em If You Got ‘Em: Even When Lou Greenwald Gets It, He Doesn’t Get It

March 30, 2010

Sometimes it seems Assemblyman Lou Greenwald just concocts new tax and spend shenanigans for no other reason than to entertain him and his Trenton buddies.

Case in point:  Greenwald has introduced new legislation that would reduce the state tax on cigarettes by 30 cents per pack in New Jersey. Currently, New Jersey has an excise tax of $2.70 per pack which is one of the highest tobacco product taxes in the country.

After ignoring common economic principals like the law of diminishing marginal returns and raising the tax to such high levels, the State Legislature has seen dramatic drops in both tobacco sales and tax revenue. While the tax increases initially had the intentions of encouraging people not to smoke and increasing revenue, the state has not realized either of those ambitions. Instead, smokers are going to neighboring states such as Pennsylvania and Delaware to buy their cigarettes, or are purchasing them online for costs far below those incurred by purchasing their tobacco in New Jersey. As a result, the revenue generated by the cigarette tax has significantly decreased despite the constant increases in tax levels.

What this tells us is that Lou Greenwald is capable of recognizing the fact that when Trenton politicans place the burden of their financial misgivings on the public, the public opts to find out-of-state alternatives.

Yet, rather than Greenwald recognizing that the cigarette tax issue is a microcosm of his and his fellow Democrats’ failed tax and spend model in Trenton, he simply looks at it as a scapegoat.  What Greenwald should acknowledge is the cause-and-effect relationship over-taxing has had on New Jersey families and businesses.  It is a direct parallel to our state’s among-the-highest-in-the-nation property and business taxes:  when you tax people excessively, rather than willfully paying the tax, they go out of state to find more affordable solutions.

Greenwald’s proposed legislation evidences the fact that he is capable of seeing these things.  Yet, when the rubber hits the road, he picks and chooses based on little more than a whim.  For further proof, look no further than his enthusiasm to address budget crunch by allowing local municipalities to create new taxes.

Greenwald may be fooling himself, but he’s not fooling us.

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