MAPLEWOOD
– A cigarette tax
hike in Minnesota that takes effect in three
weeks is leading to a short-term surge in demand, The Journal reports.
“We've
got a few customers buying 10 cartons, 20 cartons, cases of little cigars,”
said Anan Barbarawi, a store manager at Maplewood Tobacco.
While
tobacco retailers are struggling to meet the current demand spike, more
worrisome is the projected long-term impact on their business once the tax
kicks. Cross-border tax differentials in Iowa and the Dakotas will be
substantial, with each state’s taxes at least 50% less than Minnesota’s new tax
of $2.52 per pack.
“Once
the increase is already there, I think our business is going to die,” he said.
“It's going to be a huge problem. It's going to be a life-changer,” Barbarawi
said.
In
the meantime, the stockpiling continues for Minnesotans. Leroy Biczkowski of
Maplewood recently paid $110 for a carton of cigarettes, a purchase that will
cost him more than $140 in a few weeks. He said when the tax takes effect,
he’ll drive to Wisconsin to save money. “That ain’t that far,” he said.