The price of a pack: Smokers and retailers prepare for cigarette tax increase coming in April

Rick Roberts is a regular buyer of cigarettes at convenience stores in Missouri, but that could change April 1.

A resident of McClure, Ill., Roberts makes the weekly drive across the Bill Emerson Memorial Bridge into the Show Me State to purchase tobacco.

But he is contemplating quitting and blames it primarily on a cigarette tax increase set to go into effect next month.

The new federal tax increase will mean Roberts and smokers throughout the United States will pay 159 percent more tax on a pack of cigarettes. The current tax is 39 cents per pack, but after March 31 that increases to $1.01. Money generated from the additional revenue will fund health care for low-income children.

"People have the right to not breathe the secondhand smoke, but I think it's ridiculous that they assume that I also have no rights when it comes to smoking," said Roberts, who already switched to a cheaper brand of cigarettes to offset the cost. "I think with the excessive taxes on cigarettes, smokers are paying more than their fair share."

Local convenience store managers said they've already raised their prices because their suppliers began applying the increase earlier in the month. And while they've heard numerous complaints from their customers, the managers agreed that kicking the habit will be hard on smokers.

"The customers complain, but they will still buy," said Dana Abel, manager of D Mart convenience store in Jackson. "Some of them have come in to purchase a cheaper brand, but most won't switch. If those people decide to quit, it won't be because of a tax increase."

Michael Marston, manager of Winks convenience store in Cape Girardeau, said he has noticed more customers purchasing the cheaper brands.

"I don't like to see a big increase in taxes on anything, whether it's cigarettes or alcohol," Marston said. "I don't think it's right to target one specific item that people buy.

"Though it's an addictive habit, it will be difficult for the tax to stop people from quitting," he said. "I think if the government really wanted to make people stop they'll have to raise the prices much higher."

Bill Phelps, spokesman for Altria, parent company of Phillip Morris USA, said his corporation opposes the tax increase and encourages displeased consumers to contact their legislator about the issue. Of Missouri's five members of the U.S. House of Representatives who voted for the State Children's Health Insurance Program bill that authorized the tax, Jo Ann Emerson was the only Republican from the state to vote for the legislation, which passed in January. Twelve of Illinois' 18 representatives voted for the bill's passage.

"We're not the ones who set the price for retailers, and that surprises a lot of people," Phelps said. "We sell to the wholesaler, who then sells to retailers, who then set the price for the consumer."

Bruce Domazlicky, director of the Center for Economic and Business Research at Southeast Missouri State University, doubts the tax increase will have a significant effect on the economy, though he said illegal bootlegging of cigarettes could eventually happen. For bootlegging to occur, he said, the increase would have to have a fairly significant effect on individual smokers' budgets.

He said that because Missouri is ranked 49th among state tax rates, he said the sharp increase could affect more smokers' budgets and cause them to quit. Missouri's state tax is 17 cents per pack while Illinois' 98-cent state tax is 28th highest. Ill. Gov. Pat Quinn is proposing raising the state's tax on cigarettes by $1 per pack to help generate additional revenue in efforts to decrease the state's $11.5 billion budget deficit.

"Government seems to like to tax cigarettes, especially since much less than a majority of people actually smoke them anymore," Domazlicky said. "I would assume that if the tax rate gets high enough that even more people will decide to quit, which will cut into the anticipated revenue from the tax increase. I would hope some of the increased tax revenue is put into smoking cessation programs to help those smokers who would like to quit."

Ronald Williams, an assistant professor in the Department of Health, Human Performance and Recreation at Southeast, said that while he understands smokers' frustration, he believes the tax increase is a small price to pay to save the state money on smoking-related illnesses and deaths.

"Smoking-related illness, not to mention those associated with secondhand smoke, cause a tremendous burden on the public health and health-care systems in the U.S.," Williams said. "This method of taxation is simply a method to help reduce a percentage of that burden. The overall outcome is, hopefully, a better quality of life and lessened health care costs for all of us."

bblackwell@semissourian.com

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Pertinent addresses:

4517 N. High St., Jackson

2017 Perryville Road, Cape Girardeau,