Tax Hike Forces Smokers To Decide: Switch, Quit Or Pay Up
June 28, 2002 at 8:31 PM EST - Updated July 3 at 4:15 PM
By PAUL SINGER, Associated Press Writer
CLEVELAND (AP) - It may be more than hippies and jazz musicians who are rolling their own cigarettes next week as smokers around the state look for ways to avoid Ohio's new 31 cent-per-pack tax increase that begins Monday.
"The number one substitute is the roll-your-own tobacco," said John Coleman, manager of the Cousin's Cigar, a downtown store. "There will be a big upswing in roll-your-own sales. It always appears like this after a major tax increase."
The new state cigarette tax will go into effect Monday, raising the state tax on a pack from 24 cents to 55 cents. The tax will bring the price of a pack of cigarettes to about $4.50.
A pouch of loose tobacco sells for about the same price as a pack of cigarettes. But you can roll about 40 cigarettes out of the pouch, twice what you get in a pack.
Of course, it is a challenge to roll cigarettes while you drive or talk on the phone.
Many smokers may simply switch to cheaper brands of regular smokes.
"I'll look for a cheaper deal, or switch to generics," said Sandy Montgomery, 39, as she took a smoke break on a sunny afternoon. "Even if they up the price of generics, it'll still be cheaper than the name brands."
John Schneier, owner of the Cedar Lee Cigar Store in Cleveland Heights, said that in anticipation of the tax, sales have been brisk in "subgeneric" cigarettes.
"Those are cigarettes from Korea and other Asian countries that are much cheaper. I'm starting to see more sales of those," he said.
Other smokers say the price hike will be an inspiration to quit smoking entirely.
"I've been talking about quitting for a month. To pay for a habit is pretty bad. The money can be spent better than on cigarettes," said Todd Emery, 28, of Columbus, a smoker for three years. He said he smokes about 1/4 pack a day.
Anti-smoking activist Ahron Leichtman said that is part of the benefit of the tax hike.
"It definitely will drive down consumption in Ohio," said Leichtman, a Cincinnati resident who is executive director of Citizens for a Tobacco-Free Society. "Everywhere across the country where they have raised the price of a pack of cigarettes appreciably, there is a marked decline in use."
Tim Keen, Ohio's assistant budget director, said the new tax is expected to generate $283 million in revenue for the state in fiscal year 2003.
Keen said that figure assumes some people will quit or find other ways to avoid paying the tax.
Darryl Jayson, vice president of the Tobacco Merchants Association, a national trade group based in New Jersey, said the key factor for retailers is the tax structure in neighboring states. Smokers will drive across the border for a better deal if the difference in taxes is great enough, Jayson said.
For Ohio this poses a problem because neighboring Kentucky's 3-cent cigarette tax is one of the lowest in the country.
Jeff Kathman, owner of five Cut Rate Tobacco stores in the Cincinnati area, was glum Friday about Ohio's pending tax increase.
"Customers tell me they're going to quit (smoking), or they're going to Kentucky," Kathman said. "I don't know. I'll just have to hang out and see how it goes.
"Hopefully, their time is worth something to them, and we're here in town."
Many smokers seem resigned to simply paying the higher price.
Butch Gallaway, 48, of the Columbus suburb of Reynoldsburg, said he will continue to smoke.
"I'm sure I'll be paying. It's a drug you know," he said.
"A true smoker won't stop," said Regina Butts, of Toledo, said while having a cigarette with lunch at a downtown food festival.
She said she won't switch brands either.
"I'll stay the same," she said.
Rob Reiner, 22, of Toledo, said he already smokes cheap cigarettes and isn't bothered by the increased price.
"The expensive ones are a waste of money," he said. "A cigarette is a cigarette."
Steve Friesner, 30, of Parma, said he will pay the higher prices, but he is angry with how smokers are treated.
"They tax us for everything, but then where can we go? Smokers are paying for Jacobs Field," the Indians' taxpayer-supported downtown ballpark, Friesner said, "but you have to go outside the stadium to smoke."
(Copyright 2002 by The Associated Press. All Rights Reserved.)