Illinois in top 10 states for cigarette smuggling

High cigarette taxes give Illinoisans a financial reason to sneak in smokes from other states. Illinois is among the 10 states with the most smuggling.

Illinois is one of the most prolific states for cigarette smuggling according to a new study from the Tax Foundation.

Illinois is 10th in the nation for cigarette smuggling, where people sell packs from other states because Illinois state cigarette taxes are $2.98 for a package of 20 cigarettes.

For Chicagoans, state and local taxes push the total tax burden to $7.16 per pack, the highest of any city in the nation.

Smuggled cigarettes are over 1 in 4 cigarettes consumed in Illinois, using 2022 cigarette purchasing data.

Meaning if Illinois had a lower cigarette tax, there would be less of an incentive to sneak packs in from other states, potentially bringing in more revenue for the state than it currently gets.

A 2021 Tax Foundation estimate said Illinois loses almost $300 million to illegal cigarette sales that could be tax revenue.

This would be the worst of both worlds because the sin tax wouldn’t bring in added revenue or stop people from a bad habit. Usually, those two goals are competing against one another, but with too high of tax, you lose both battles.