Call it anecdotal. But why in the year following Maryland's cigarette tax hike are the Comptroller's agents on pace to arrest more than twice as many people for bootlegging them and seize four times as much contraband?

Hmm. Could the extra $1 tacked on to the price of cigarettes last year have something to do with more illegal activity? State legislators won't say. Neither will the Comptroller's office speculate on the issue - his police officers just arrest people for violating the law.

But the evidence points to the fact that higher cigarette taxes not only won't generate anticipated revenue for the state but are fueling illicit behavior. Next time legislators contemplate hiking them in the name of health, they should take a smoke break.

From 1999 to 2008 taxes collected from cigarettes rose from $131.3 million to $343.7 million, thanks to three tax hikes raising the state's take per-pack from $.36 to $2.00 last year. But that revenue is poised to fall. Comptroller Peter Franchot last month revised downward - for the second time in a few months - tobacco tax estimates for the year and predicts revenue will fall in 2010. The economy is only partly to blame.

Sales of cigarettes have dropped from 71.4 packs per person in 1999 to 43.3 in 2008, according to Tax Foundation data. That trend alone means the state would lose money over time. But the numbers don't add up.

Not that many people have stopped smoking to make quitting a logical explanation for the fall in packs sold. And a report in The Washington Post last summer showed smokers are not getting their fix by buying cigarettes in lower-tax destinations like Delaware and Virginia as tax collections are steady in those states.

Patrick Fleenor, chief economist at the Tax Foundation and author of the Cato Institute report, "Cigarette Taxes, Black Markets, and Crime" said the black market is to blame. Like drug laws, he said it's politically easy to pass laws against cigarettes but very difficult to enforce them without a major investment in personnel and technology. But even then you're only going to catch a small portion of those breaking the law, he said.

He estimates that the black market is responsible for about 50 to 75 percent of the cigarettes sold in New York City, where state and local taxes are $4.25 of a $10 pack. He also called tax revenue estimates "myopic" because they do not factor a loss in sales and income tax revenue as convenience stores move across borders to lower-taxed states.

Jeffrey Kelly, the director of field enforcement for the Comptroller's office, said the Comptroller's officers work closely with other law enforcement officers in Maryland and in other states to track criminals.

They receive training from cigarette companies to learn the difference between real and counterfeit packs; regularly inspect licensed cigarette sellers to ensure they are selling those that have been properly taxed; and work with postmasters to catch people mailing large quantities of them. But he said many people they arrest are small fry "mules" who earn a couple of hundred dollars transporting cigarettes for bigger operators.

The numbers suggest they are not getting those big guys. Maryland is not New York City. But if only 10 percent more cigarettes were sold in the state than tax records indicate, that means over $100 million in sales is going unaccounted.

So far this year, the Comptroller's office reports agents have confiscated 170,271 packs worth $839,000. That amount would not cover the salaries of the agents and inspectors who work in the enforcement division.

A May 2004 Government Accountability Office report says those bigger operators are members of organized crime. "According to an ATF report, some cigarette smugglers have ties with terrorist groups, and there are indications that terrorist group involvement in illicit cigarette trafficking, as well as the relationship between criminal groups and terrorist groups, will grow in the future because of the large profits that can be made.

In addition, according to ATF and ICE, organized crime groups sometimes launder proceeds of international cigarette smuggling through U.S. financial institutions."So raising cigarette taxes is not only an increasingly bad deal financially for the state, it is deadly for everyone in the U.S. That should give Maryland legislators pause next time they advocate raising them "for the children."

Examiner columnist Marta H. Mossburg is a senior fellow at The Maryland Public Policy Institute.