Scott Zucca, a Delaware shop owner, said in an op-ed that a proposed increase in the state cigarette tax would raise costs for working-class smokers, push sales out of state, and affect small businesses and local communities.
The proposal to raise Delaware’s cigarette tax has sparked debate over its potential impact on consumers and retailers. Lawmakers have introduced legislation to increase the state cigarette tax from $2.10 to $3.60 per pack of 20 as part of a broader tobacco-tax package that also increases taxes on vapor products and other tobacco items. The proposal reflects Zucca’s warning about a steep, immediate price jump that can change buying behavior overnight and squeeze neighborhood retailers, according to the Delaware General Assembly.
Zucca said, “This tax hike hits the working class the hardest. It’s well documented that most smokers are lower-income individuals. When prices go up, they don’t just feel it; they struggle with it. This tax is regressive by nature, punishing people who are already stretched thin by rising costs across the board, from groceries to gas to utilities.”
Research summarized by the American Economic Association finds that cigarette taxes have become more regressive: the lowest-income consumers paid roughly ~2% of their income in cigarette taxes in 1992, rising to above 2.5% by 2014, while the highest-income group stayed near a tenth of a percent (0.1%), evidence that such tax increases fall hardest on households with the least financial cushion.
Zucca also addressed concerns about cross-border sales: “We’ve had the benefit of out-of-state shoppers crossing the borders to make their purchases here. If we raise our tax to surpass Pennsylvania’s or New Jersey’s, for example, that advantage disappears.”
Higher cigarette taxes are strongly linked with tax avoidance and illicit trade. Tax Foundation’s 2023 estimates show large smuggling shares in high-tax states and also list Delaware as a major ‘export’ state, with an estimated 38.7% outbound smuggling rate—evidence cross-border diversion is already significant in the region and can accelerate when price gaps widen.
According to the Tax Foundation, California—one of the highest-tax cigarette states—now leads the U.S. in cigarette smuggling; an estimated 52.5% of cigarettes consumed there in 2023 were not purchased legally in-state. The analysis highlights a strong relationship between higher excise taxes and increased black market diversion, supporting concerns that Delaware’s cigarette tax hike could lead to similar outcomes.
Zucca added, “This tax increase will not just affect smokers; it will affect small-business owners, employees and entire communities that rely on the local economy.”
According to a cigar-industry press release, Zucca is owner of Emilio Cigars and distributes through L.J. Zucca Inc., described as a family-owned company distributing tobacco and other products since 1947.
