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How much will tobacco tax rise?

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May 14, 2013 at 6:46 am

ST. PAUL, Minn. (AP) Minnesota's cigarette tax is about to go up, but a top lawmaker says the new rate won't be more than Wisconsin's.

Minnesota Senate Majority Leader Tom Bakk says the final tax could match the $2.52 per pack rate charged in Wisconsin. That's $1.29 more than Minnesota assesses now. The House had suggested a $1.60 boost.

The higher tobacco tax is part of a $2 billion plan to raise new money toward the state's next budget.

Bakk says the tax bill is likely to include a limited broadening of the sales tax base, but the concentration will be on warehousing and other business-to-business transactions. But Bakk says that the plan is to exempt local governments from all sales taxes, at a cost of more than $100 million per year.

Mike Tanner

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