New York Governor Proposes Cigar Tax Hike

Facing a projected $12.5 billion budget shortfall, New York Gov. David Paterson offered a $121.1 billion dollar spending plan Tuesday that proposes many new taxes, includes raising the state cigar tax.

If the proposed budget were to be approved, New York cigar smokers would be forced to pay 50 cents per cigar. The current tax is about 34 cents.

The tax increase is predicted to create $10 million in new revenue for the state.

Paterson's budget also proposes, among other things, a tax rate increase on soda, movie and sporting event tickets, beer and wine, as well as downloaded music.

The plan would also cut roughly $9 billion in spending, with projected spending cuts in health care, as well as an actual cut in education.

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