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Tobacco sales soar pending tax increase


By Dennis Sherer
Staff Writer

Published: Tuesday, March 31, 2009 at 3:30 a.m.

Business was so brisk at Thomas Discount Tobacco in Russellville on Monday that owner Mark Thomas barely had time to look up between ringing up sales.

"Business has really picked up the past few days," Thomas said. "A lot of people are trying to beat the price increase."

The federal tax on a pack of cigarettes increases by 61 cents Wednesday. Taxes on cigars, chewing tobacco and other tobacco products are also increasing. The additional tax money will go toward a major expansion to a federal program that provides health insurance for children. President Obama signed the tax hike into law shortly after taking office.

The increase comes on the heels of price hikes by tobacco manufacturers earlier this month.

Rob Burkey, owner of Tobacco Cabin on Cloverdale Road in Florence, said the cost for some popular cigarette brands increased by more than $7 per carton March 9. "The manufacturers went up I guess because they could. I don't know why they went up as much as they did."

Some major brands of cigarettes already cost more than $4 per pack. A few brands cost more then $5 per pack.

Thomas said the combination of smokers scrambling to beat the tax increase and production cutbacks by tobacco product manufacturers this month has led to shortages of some brands. "We're really limited in what we can keep in stock right now."

After buying a pack of cigarettes Monday at Tobacco Cabin, Paul Harris, of Florence, lamented the upcoming tax increase.

"I think it's outrageous," he said. "I don't mind helping if it's going to a good cause, but enough is enough. I don't smoke much, maybe a pack every two or three days; I can't imagine how tough this is going to be on the folks who smoke a pack or two a day."

Another Tobacco Cabin customer, Roger Jackson, of Florence, blamed the Obama administration for the tax increase.

"The government is just trying to take our smoking rights away from us by taxation," Jackson said.

After paying $150 for four cartons of Marlboro lights, Jackson said it's becoming too expensive to smoke. "I might have to quit."

Kelley Elkins, of Florence, said the recent price increase plus Wednesday's tax hike could provide the incentive he needs to stop smoking.

"I've been trying to quit for years," he said.

"I'm probably going to try harder now."

Patrick Reynolds, founder of California-based Foundation for a Smokefree America, is hopeful the soaring prices for tobacco products will help many Americans kick the habit.

While the tax increase is the bane of many smokers, Reynolds, whose grandfather founded the RJ Reynolds tobacco company, supports the hike.

"Tobacco tax increases are win, win, win," Reynolds said. "They are win because fewer children will start smoking because of the high price. They are a win because they give smokers another incentive to stop smoking, and they are win because they are immensely popular with voters. More than 80 percent of Americans are non-smokers and most of the non-smokers are in favor of increasing tobacco taxes."

Burkey said if the government wants to raise more money to provide health insurance for children, it should hike taxes on baby food, infant formula and other products consumed by children. He said its unfair to smokers to force them to pay more taxes so the government can expand its insurance program for children.

Dennis Sherer can be reached at 740-5746 or dennis.sherer@TimesDaily.com.