49. Consumer Taxes
The taxation system in the United States is very complicated due, in part, to the attempt by governing bodies to make taxation, across the board, appear reasonable and invisible.
Overall, there are two types of consumer taxes. Some are meant merely to raise revenues while others are designed to inhibit certain behavior. (In the income tax arena, however, which is significantly in the domain of the federal government, taxes and deductions and exemptions are used to actually promote certain behavior, such as saving money or buying a house.) In many cases, the behavioral control aspect of the tax has outweighed the particular tax’s revenue-raising function. For example, tobacco-producing states do not have cigarette taxes (Kentucky, 3¢, North Carolina, 1.75¢, and Virginia, 2.5¢) that are as high as those in states that, for various reasons, attempt to inhibit smoking (Maine, $2.00, Arizona, $1.18, and Michigan, $2.00).
Market forces also influence consumer taxes. For example, the tax on wines produced in California is low compared to taxes on wines produced in other states. If California taxes were close to the national average, then California wines sold in other states would have artificially inflated prices, thus hurting its marketability.
The taxes treated in this chapter are not exhaustive. Rather, they are representative of the most common and significant consumer taxes levied by states.
| Table 49: Consumer Taxes |
|---|
| State | Sales Tax | Cigarette Tax | Gasoline Tax per Gallon | Use Tax | Liquor Tax | Gambling Tax |
|---|
| ALABAMA | 4% §40-23-2 | 21.25 mills/cigarette §40-25-2 | 16¢ §§40-17-31, 220 | 4% §§40-23-61, 63 | Liquor monopoly state; Beer 5.0¢/12 oz. + 1.625¢/4 oz. (§§28-3-184, 190); Wine and spirits 10% wholesale price (§28-3-200) + 48% (§§28-3-201 to 205); Table wine 45¢/liter (§28-7-16)Native Farm wines 45¢/liter | NA |
| ALASKA | None | 38 mills/cigarette plus 62 mills/cigarette §43.50.190, §43.50.090 | 8¢ §43.40.010 | None | Beer $1.07/gal.; Wine and spirits ≤21% alcohol $2.50/gal., >21% $12.80/gal. §43.60.010 | NA |
| ARIZONA | 5% §42-5010 | $1.18/pack of 20 §42-3052 | 18¢ §28-5606 | Same as sales for same type of activity §42-5155 | Beer 16¢/gal.; Wine <24% 84¢/gal., >24% 25¢/gal.; Spirits $3.00/gal. §42-3052 | NA |
| ARKANSAS | 6% §§26-52-301, 302 | $10.50 per thousand cigarettes §26-57-208 | 13.5¢ §§26-55-205, 1002 | 5.125% §§26-52-302; 26-53-106, 107 | Beer 20¢/gal.;Light wine 25¢/gal.; Wine 75¢/gal.; Spirits $2.50/gal. §3-7-104;Premixed spirits $1.00/gal.;Light spirits 50¢/gal. | NA |
| CALIFORNIA | 5.75% Rev. & Tax §§6051 to 6051.4 | 18.5 mills/cigarette plus 50¢/pack of 20 Rev. & Tax §§30101, 30123 | 18¢ Rev. & Tax §7360 | 5.75% Rev. & Tax §§6201 to 6201.4 | Beer $1.24/barrel; Still wines 20¢/gal.; Sparkling wine 30¢/gal.; Spirits $3.30 to $6.60/gal. Rev. & Tax §§32151, 32201, 32220 | NA |
| COLORADO | 3% §39-26-106 | 10 mills/cigarette §39-28-103 | 22¢ §39-27-102 | 2.9% §39-26-202 | Beer 8¢/gal.; Wine 7.33¢/liter (12.33¢/liter Colorado wines); Spirits 60.26¢/liter §§12-47-503 | Not to exceed 40% of adjusted gross profits §12-47.1-601 |
| CONNECTICUT | 6% §§12-408 | 75.5 mills/cigarette §12-316 | 25¢ §12-458 | 6% §§12-411 | Beer $6.00/barrel; Still wine <21% 60¢/gal., >21% and sparkling wine $1.50/gal.; Spirits $4.50/gal. §12-435 | NA |
| State | Sales Tax | Cigarette Tax | Gasoline Tax per Gallon | Use Tax | Liquor Tax | Gambling Tax |
|---|
| DELAWARE | $75 annual fee plus 0.144% gross receipts Tit. 30 §2702 | 27.5 mills/cigarette Tit. 30 §5305 | 23¢ Tit. 30 §5110 | 1.920% Tit. 30 §4302 | Beer $4.85/barrel; Wine 97¢/gal.; Spirits <25% $3.64/gal., >25% $5.46/gal. Tit. 4 §§581 | NA |
| DISTRICT OF COLUMBIA | 5.75% §47-2002 | 5¢/cigarette §47-2402 | 20¢ §47-2301 | 5.75% §47-2202 | Beer $2.79/barrel; Wine <14% 30¢/gal, >14% 40¢/gal.; Sparkling wine 45¢/gal.; Spirits $1.50/gal. §§25-901, 902 | NA |
| FLORIDA | 6% §§212.05 | 16.95 mills/cigarette §210.02 | 4¢ §206.41 | 6% §§212.05 | Beer 48¢/gal.; Wine <17.259% $2.25/gal., >17.259% $3.00/gal.; Sparkling wine $3.50/gal.; Spirits 17.259% to 55.78% $6.50/gal., >55.78% $9.53/gal. §§563.05; 564.06; 565.12 | NA |
| GEORGIA | 4% §48-8-30 | 37¢/pack of 20 cigarettes §48-11-2 | 7.5¢ §48-9-3 | 4% §48-8-30 | Beer $10/barrel, in bottles or cans 5¢/12 oz.;Wine 40¢/liter + 27¢ excise tax on dessert wine; Spirits 50¢/liter, $1.00/liter imported §§3-5-60; 3-6-50; 3-4-60, 3-5-80 | NA |
| HAWAII | 4% §237-13 | 9¢/cigarette §245-3 | 16¢ + additional county rates §243-4, 5 | 4% §238-2 | Draft beer 54¢/gal.; Bottle beer 93¢/gal.; Still wine $1.38/gal.; Sparkling wine $2.12/gal.; Spirits $5.98/gal. §244D-4; rates adjusted semiannually | NA |
| IDAHO | 6% §§63-3619 | 57¢/pack of 20 cigarettes §63-2506 | 25¢ §§63-2405 | 6% §§63-3621 | Beer $4.65/barrel; Wine 45¢/gal.; 15% of price per unit on all goods sold in state dispensary 23-217, 1319, 1008 | NA |
| State | Sales Tax | Cigarette Tax | Gasoline Tax per Gallon | Use Tax | Liquor Tax | Gambling Tax |
|---|
| ILLINOIS | 6.25% 35 ILCS 120/2-10 | 49 mills/cigarette 35 ILCS 130/2 | 19¢ 35 ILCS 505/2 | 6.25% 35 ILCS 105/3-10 | Beer 18.5¢/gal.; Wine 73¢/gal.; Spirits $4.50/gal. 235 ILCS 5/8-1 | Riverboat gambling tax $2 per person admitted; wagering tax 15 to 70% adjusted gross receipts 230 ILCS 10/12, 230 ILCS 10/13 |
| INDIANA | 6% §§6-2.5-2-2 | 55¢/pack of 20 §6-7-1-12 | 18¢ §6-6-1.1-201 | 6% §§6-2.5-3-3 | Beer 11.5¢/gal.; Wine <21% 47¢/gal., >21% $2.68/gal.; Spirits $2.68/gal. §§7.1-4-2-1; 7.1-4-3-1; 7.1-4-5-1 | Riverboat gambling tax of 22.5% adjusted gross receipts §4-33-13-1 |
| IOWA | 5% IRA State & Local Taxes §21.005, et seq. | 6.8¢/cigarette §453A.6 | 20.3¢ §452A.3 | 5% §423.2 | Beer $5.89/barrel; Wine $1.75/gal. §§123.136; §§123.183 | Excursion boat gambling tax: 5% on first $1 million; 10% next $2 million; 20% over $3 million (racetrack betting: over $3 million: 22%, increasing 2%/yr. to a maximum of 36%§99F.11 |
| KANSAS | 5.3% §79-3603 | 79¢/pack of 20 cigarettes §79-3310 | 24¢ §§79-34, 141 | 5.3% §79-3703 | Beer 18¢/gal.; Wine <14% 30¢/gal., >14% 75¢/gal.; Spirits $2.50/gal. (additional taxes for on-premises consumption) §§41-501; 79-4101; 79-41a02 | NA |
| KENTUCKY | 6% §§139.200 | 3¢/pack of 20 cigarettes §138.140 | 15¢ (9% of average wholesale price plus supplementary highway user motor fuel tax, computed quarterly) §138.220 | 6% §§139.310 | Beer $2.50/barrel; Wine 50¢/gal.; Spirits $1.92/gal. §§243.720 | NA |
| State | Sales Tax | Cigarette Tax | Gasoline Tax per Gallon | Use Tax | Liquor Tax | Gambling Tax |
|---|
| LOUISIANA | 2% §§; 47:302, 331 | 1.8¢/cigarette §47:841 | 20¢ §§47:711, 820.1 | 4% §§; 47:302, 331 | Beer $10/barrel;Still wine <14% 3¢/liter, 14-24% 6¢/liter, >24% 42¢/liter; Sparkling wine 42¢/liter;Spirits 66¢/liter §§26:341, 342 | NA |
| MAINE | 5% Tit. 36 §§1811, 1861 | 100 mills/cigarette Tit. 36§4365 | 22¢ Tit. 36 §2903 | 5% 36 §1861 | Liquor monopoly state; Beer 25¢/gal.; Wine 30¢/gal.; Sparkling wine $1.00/gal.;Spirits: Commission must sell at price that will produce state liquor tax sufficient to pay all gov’t liquor-related expenses, cost plus $1.25/proof gal. Tit. 28-A §§1651, 1652, 1703 | NA |
| MARYLAND | 5% Tax-Gen. §11-104 | $1.00/pack of 20 cigarettes Tax-Gen. §12-105 | 23.5¢ Tax-Gen. §9-305 | 5% Tax-Gen. §11-104 | Beer 9¢/gal.; Wine 40¢/gal.; Spirits $1.50 gal.; Tax-Gen. §5-105 | NA |
| MASSACHUSETTS | 5% Ch. 64H §2 | 50.5 mills/cigarette Ch. 64C §6 | 21¢ (19.1% of average price, but minimum cannot be less than 21¢/gal.) Ch. 62C§3A; Ch. 64A§1; Ch. 64E§4; Ch. 64F§3 | 5% Ch. 64I §2 | Beer $3.30/barrel; Still wine 55¢/gal.; Sparkling wine 70¢/gal.; Spirits <15% $1.10/proof gal., 15-50% $4.05/proof gal., >50% $4.05/proof gal. Ch. 138 §21 | NA |
| MICHIGAN | 6% §205.52 | 100 mills/cigarette §§205.427 | 19¢ §§207.1008 | 6% §205.93 | Beer $6.30/barrel; Wine <16% 13.5¢/liter, >16% 20¢/liter; Spirits offsale 13.85% of retail selling price, onsale 12% of retail selling price §§436.1409; 436.2203; 436.2205 | 18% of gross revenue of casino §432.213 |
| State | Sales Tax | Cigarette Tax | Gasoline Tax per Gallon | Use Tax | Liquor Tax | Gambling Tax |
|---|
| MINNESOTA | 6.5% 297A.62 | 24 mills/cigarette §297F.05 | 20¢ §296A.07 | 6.5% 297A.63 | Beer 3.2% $2.40/barrel, >3.2% $4.60/barrel;Wine 14% 30¢/gal., 14-21% 95¢/gal., 21-24% $1.82/gal., >24% $3.52/gal.; Sparkling wine $1.82/gal.; Spirits $5.03/gal. §297G.03, 297G.04 | Horseracing 6% of net receipts plus 1% of gross bets §240.15; Gambling 8.5% other than pull tabs and tip boards §297E.02 |
| MISSISSIPPI | 7% 27-65-17 | .9¢/cigarette §27-69-13 | 18¢ §27-55-11 | Same rate as sales tax 27-67-5 | Beer, light wine 42.68¢/gal.; Wine 35¢/gal.; Sparkling wine $1/gal.; Spirits $2.50/gal. A 3% markup is imposed on all alcoholic beverages sold by the Alcoholic Beverage Control Division §§27-71-7, 201, 307; 67-1-41 | 3% state gambling tax §27-7-15 |
| MISSOURI | 4.225% §144.020; Mo. Const. Art. IV §§43(a) and 47(c) | 6.5 mills/cigarette §149.015 | 17¢ §142.803 | Same rate as sales tax §144.610 | Beer $1.86/barrel; Wine 30¢/gal.; Spirits $2/gal. §§311.550 | Riverboat gambling tax: $2.00 per person admitted §313.820 |
| MONTANA | None | $1.70/pack of 20 cigarettes §16-11-111 | 27¢ §15-70-204 | None | Liquor monopoly state; Beer $4.30/barrel; Wine 27¢/liter; Spirits 13.8% retail selling price for companies <200,000 gal./year nationwide, 8.6% for >200,000 gal./year §§16-1-401, 404, 406, 411; 16-2-301 | 15% gross income from video gambling machines; 1% gross receipts for horse-racing §§23-5-610, 23-4-202 |
| NEBRASKA | 5.5% (Legislature is required to set rate each year) §§77-2701.02, 2715.01 | 64¢/pack of 20 cigarettes §77-2602 | 17¢ §§66-4, 105; 66-4,144; 66-4,145; 66-4,146; 66-489 | 5.5% §§77-2701.02, 2715.01 | Beer 31¢/gal.; Wine 95¢/gal.; Spirits $3.75/gal.; Wine from farm wineries 6¢/gal. §53-160 | 5% gross receipts for boxing or wrestling matches; 0.4% gross sum wagers for admission tax for horse-racing §§81-8, 135, 2-1208 |
| State | Sales Tax | Cigarette Tax | Gasoline Tax per Gallon | Use Tax | Liquor Tax | Gambling Tax |
|---|
| NEVADA | 6.5% §§372.105; 374.110; 377.040 | 40 mills/cigarette §370.165 | 23¢ §§365.175, 180, 190, 192 | 6.5% §§372.185; 374.190; 377.040 | Beer 16¢/gal.; Wine <14% 70¢/gal., 14-22% $1.30/gal., >22% $3.60/gal. §369.330 | Gross revenues <$50,000/mo. 3.5%; $50,000-134,000 4.5%; >$134,000 6.75% §§463.370 |
| NEW HAMPSHIRE | None | 80¢/pack of 20 cigarettes §78:7 | 18¢ §260:32 | None | 30¢/gal. on all beverages sold at retail;Domestic wine 10% of gross sales §§178:6, 28, 30 | 1 or 2% of total contribution for racing; 5% gross receipts for boxing or wrestling §§284:23, 285:14 |
| NEW JERSEY | 7% §54:32B-3 | .12¢/cigarette §54:40A-8 | 10.5¢ §54:39-27 | 7% §54:32B-6 | Beer 12¢/gal.; Wine 70¢/gal.; Spirits $4.40/gal. §54:43-1 | 8% of gross revenues §5:12-144 |
| NEW MEXICO | 5% §7-9-4 | 4.55¢/cigarette §7-12-3 | 17¢ §7-13-3 | 5% §7-9-7 | Beer 41¢/gal.; Wine 45¢/liter; Spirits $1.60/liter §7-17-5 | 20% net take to purse for race track §60-2E-47 |
| NEW YORK | 4% Tax §§1105 | $1.50/pack of 20 cigarettes §471 | 8¢ §§284, et seq. | 4% §§1110 | Beer 11¢/gal.;Still and sparkling wine 18.93¢/liter/gal. (natural);Spirits <24% 67¢/gal.; other $1.70/liter §424 | |
| NORTH CAROLINA | 4.5% §105-164.4 | 1.75¢ mills/cigarette §105-113.5 | 17.5¢ §105-449.80 | 4.5% §105.164.6 | Beer 53.177¢/gal. Wine 21¢/liter unfortified, 24¢/liter fortified;Spirits 25% retail §§105-113.80 | NA |
| NORTH DAKOTA | 5% §§57-39.2-02.1, 03.2 | 5.5 mills/cigarette §§57-36-06 | 23¢ §57-43.1-02 | 5% §§57-40.2-02.1 | Beer 8¢/gal. in barrels, 16¢/gal. in bottles; Wine <17% 50¢/gal.; 17-24% 60¢/gal.; Sparkling wine $1.00/gal.; Spirits $2.50/gal. §5-03-07 | 2.5% of 25% of wagering pool for horse races; gambling operations: 5% gross proceeds <$200,000, 10% $200,000– 400,000, 15% $400,000– 600,000, 20% >$600,000. §§53-06.2-11, 53-06.1-12 |
| State | Sales Tax | Cigarette Tax | Gasoline Tax per Gallon | Use Tax | Liquor Tax | Gambling Tax |
|---|
| OHIO | 6% §5739.025 | 62.5 mills/cigarette §§5743.02, 023 | 2¢ + variable cents per gallon rate §§5735.25; 5735.05 | 5.5% §5741.02 | Beer $5.58/barrel; bottled: .14¢/oz. <12 oz.; .84¢/6oz. in containers >12 oz.; Wine 4-14% 30¢/gal., 14-21% 98¢/gal.; Vermouth $1.08/gal.; Sparkling wine $1.48/gal.; Spirits $1.20/gal. §§4301.42, 43; 4305.01 | Horseracing wagers: <$200,000, 1%; $200,000– 300,000, 2%; $300,000– 400,000, 3%; >$400,000, 4% §3769.08(B) |
| OKLAHOMA | 4.5% Tit. 68 §§1354 | 4 mills/cigarette Tit. 68 §§302 | 16¢ Tit. 68 §§500.4 | 4.5% Tit. 68 §1402 | Beer <3.2% $11.25/barrel, >3.2% $12.50/barrel;Wine <14% 19¢/liter, >14% 37¢/liter; Sparkling wine 55¢/liter;Spirits $1.47/liter Tit. 37 §§163.3; 553 | Racing: admission tax 10%; 2% all money wagered; Boxing: 5% gross receipts Tit. 3A§§207, 205-6, 516 |
| OREGON | None | 29 mills/cigarette §323.030 | 24¢ §319.020 | None | Beer $2.60/barrel; Wine <14% 67¢/gal., 14-21% 12¢/gal.; 473.030 | NA |
| PENNSYLVANIA | 6% Tit. 72 §§7202 | 6.75¢/cigarette Tit. 72 §8206 | 12¢ 75 §9004 | 6% Tit. 72 §§7202 | Beer $2.48/barrel; §9003; 47 §795 | Horse racing: admission tax 15% admission price; 1.5% wagers retained 4§§325.222, 325.208 |
| RHODE ISLAND | 7% §§44-18-18, 20 | 123 mills/cigarette §44-20-12 | 30¢ §31-36-7 | 6% §44-18-20 | Made in state: Beer $3.00/barrel; Still wine 60¢/gal. (from Rhode Island grapes 30¢); Sparkling wine 75¢/gal.; Spirits $3.75/gal. variable rates for imported alcohol §3-10-1; 3-10-17 | 3-6% of total money wagered §§41-4-3, et seq. |
| SOUTH CAROLINA | 5% §§12-36-910 | 3.5 mills/cigarette §12-21-620 | 16¢ §§12-28-310 | 5% §§12-36-1310 | Beer .6¢/oz.; Wine <21% 90¢/gal.; All other alcoholic beverages 12¢/8oz. or 50.7¢/liter;Wholesalers are subject to additional tax; Additional excise tax on sale of wine §§12-21-1020, 1040, 1310; 12-33-230, 240, 410, 425, 460 | NA |
| State | Sales Tax | Cigarette Tax | Gasoline Tax per Gallon | Use Tax | Liquor Tax | Gambling Tax |
|---|
| SOUTH DAKOTA | 4% §10-45-2 | 67.5 mills/cigarette §§10-50-3; 10-50-10 | 22¢ §10-47B-4 | Same general rates as sales tax §10-46-2 | Beer $8.50/barrel; Wine 3.2-14% 93¢/gal., 14-20% $1.45/gal., 21-24% (except sparkling) $2.07/gal.; All other $3.93/gal.; Additional 2% imposed on all but malt beverages by wholesaler from distiller, manufacturer, or supplier §§35-5-3; 35-5-6.1 | 8% of adjusted gross proceeds; May be decreased or increased by Commission on Gaming from 5-15% §42-7B-28 |
| TENNESSEE | 7% 67-6-202 | 10 mills/cigarette plus 0.05¢/pack for dealers or distributors | 20¢ 67-3-201 | 7% 67-6-209 | Beer $4.29/barrel; Wine $1.21/gal.; Spirits $4.40/gal. §§57-3-302; 57-5-201 | NA |
| TEXAS | 6.25% Tax §§151.051 | $70.50/thousand cigarettes Tax §154.021 | 20¢ Tax §162.102 | 6.25% Tax §§151.101 | Beer $6.00/barrel; Malt liquor >4% 19.8¢/gal.;Still wine <14% 20.4¢/gal., >14% 40.8¢/gal.; Sparkling wine 51.6¢/gal.; Spirits $2.40/gal. Alc. Bev. §§201.01, et seq. | Bingo Enabling Act 3% facility rental; 5% prize Occ. Code §2001.501,502 |
| UTAH | 4.75% §59-12-103 | 3.475¢/cigarette §§59-14-204 | 24.5¢ §59-13-201 | 4.75% §59-12-103 | Beer $12.80/barrel; 13% retail purchase price all other §§59-15-101; 59-16-101 | |
| VERMONT | 6% Tit. 32 §9771 | 89.5 mills/cigarette Tit. 32 §7771 | 19¢ Tit. 10 §1942; Tit. 23 §3106 | 6% Tit. 32 §9773 | Beer 26.5¢/gal. if <6% and 55¢/gal. if 6-8%;Wine 55¢/gal.; Spirits and fortified wine 25% of gross revenues Tit. 7 §§421, 422 | NA |
| VIRGINIA | 3.5% §58.1-603 | 1.25 mills/cigarette §§58.1-1001 | 17.5¢ §58.1-2217 | 3.5% §58.1-604 | Beer 25.65¢/barrel, 2¢/bottle <7 oz., 2.65¢/bottle 7-12 oz., 2.22 mills/oz./bottle >12 oz.; Wine 40¢/liter §§4.1-234, 236 | Boxing and wrestling: <$100,000 gross receipts 5% plus 2.5% of remainder; Horseracing: 1 + 3% of the pool §§54.1-833, 59.1-392 |
| State | Sales Tax | Cigarette Tax | Gasoline Tax per Gallon | Use Tax | Liquor Tax | Gambling Tax |
|---|
| WASHINGTON | 6.5% §82.08.020 | 15.5 mills/cigarette §§82.24.020, 027 | 37¢ §82.36.025 | 6.5% §82.12.020 | Beer $8.08/barrel; table wine 22.67¢/liter, fortified wine 45.11¢/liter; Additional tax on sales of wine and beer at 7% of basic tax rates §§66.24.210, 290; 82.02.030 | Counties, cities, city-counties, and towns may tax within its jurisdiction §9.46.110 |
| WEST VIRGINIA | 6% §11-15-3 | 55¢/pack of 20 cigarettes §11-17-3 | 20.5¢ §11-14C-5 | 6% §11-15A-2 | Nonintoxicating beer $5.50/barrel; Intoxicating liquor 5% of purchase price §11-16-13, 60-3A-21 | Racing: $150– 250 daily tax and municipalities may levy tax; 1.4–8% of pool §19-23-12, 1, 10 |
| WISCONSIN | 5% §§77.52 | 38.5 mills/cigarette §139.31(1) | Varies annually according to formula §§78.01,.015, .017 | 5% §77.53 | Beer $2/barrel; Wine <14% 6.605¢/liter, 14-21% 11.89¢/liter; All other 85.86¢/liter; administrative fee on all beverages >21% 3¢/gal.;Other intoxicating liquor 85.86¢/liter §§139.02, 03 | Racetrack admission 50¢/person; 1–82/3% total amount wagered §§562.08, 562.065 |
| WYOMING | 4% §39-15-104 | 6¢/cigarette §39-18-104 | 14¢ §39-17-104 | 4% §39-16-104 | Beer .5¢/liter;Wine .75¢/ml.; Spirits 2.5¢/100 ml. §12-3-101 | NA |
