Alexander Hamilton wrote in Federalist 21:
It is a signal advantage of taxes on articles of consumption, that they contain in their own nature a security against excess. They prescribe their own limit; which cannot be exceeded without defeating the end proposed, that is, an extension of the revenue. When applied to this object, the saying is as just as it is witty, that, “in political arithmetic, two and two do not always make four .” If duties are too high, they lessen the consumption; the collection is eluded; and the product to the treasury is not so great as when they are confined within proper and moderate bounds. This forms a complete barrier against any material oppression of the citizens by taxes of this class, and is itself a natural limitation of the power of imposing them.
A release from Rutgers University:
New York City has the highest cigarette taxes in the nation, but Rutgers Health research indicates that many smokers illegally avoid them. Most cigarette packs littered on city streets came from out-of-state sources or bore no tax stamps, according to a study that suggests widespread evasion of the city’s steep tobacco taxes. Researchers who collected 252 discarded cigarette packs from across the city’s five boroughs found that only 16.6% bore the proper New York City tax stamp, down from 39.3% in 2011 and 23.7% in 2015 when other teams conducted the same experiment. The findings, published in Tobacco Control, based on systematic collection from 30 census tracts in February 2024, offer a unique window into consumption patterns by using litter as a proxy for where smokers obtain cigarettes.