Posted on 09/25/2002 2:32:10 AM PDT by kattracks
Nearly three months have passed since the city and state collaborated to pass the largest single tax increase in New York City's history, raising the tax on cigarettes to $1.50 a pack from 8 cents.When this hike of almost 1,900% was proposed, grocery store owners warned that it would have a devastating impact on neighborhood stores that depend on cigarette sales for up to 25% of their gross revenues. We also predicted a flood of bootlegging and a dramatic seepage of sales to nearby states with lower taxes. As a Daily News investigative report Monday vividly highlighted, the impact may be even worse than predicted.
Neighborhood grocery stores have suffered a decline of close to 50% in cigarette revenue. In low-income areas where our bodegas have historically flourished, there is blatant hawking of illegal smokes - often right in front of our stores. Sales to minors, which were declining as a result of vigorous law enforcement, have started to increase as the hawkers sell to anyone with ready cash, no questions asked.
Law enforcement budgets, straining under the post-9/11 crunch, will have to rise to meet the smuggling threat and intervene in the inevitable turf wars that until now have been associated almost exclusively with the drug trade.
And, as The News also reported, untaxed Internet sales have skyrocketed. The projected loss for the city and state is $250 million a year, according to the chairman of the Tobacco Association of the State of New York.
The prospect for neighborhood economies is grim. City bodegas and greengrocers account for hundreds of millions of dollars in annual sales. This business creates the lively foot traffic that helps make our communities safer while providing jobs for tens of thousands of entry-level workers.
Meanwhile, merchants in Nassau and Westchester counties and New Jersey have begun to reap the benefits of this misguided policy as customers cross borders in search of reasonable prices. This sales hemorrhaging will lead to bankruptcies, store closings and serious job losses for the city's immigrant work force.
Before the cigarette tax hike passed, the Bodega Owners Association offered a number of alternatives to generate revenues, including a modification of the city's system for collecting fines. No one listened.
As tax revenues drop, workers are laid off and stores fail, will our elected officials admit that the use of the cigarette tax to balance the city's budget was a classic example of political smoke and mirrors?
Fernandez is president of
the Bodega Owners Association
The only revenge I can get at the moment for the outrageous theivery of the cigarette tax imposed on me is watching the economy tank. You can't take $500/mo in cigarette taxes out of 20% of the American public's "discretionary" spending and not bring on a recession.
Cigarettes are a commodity and should be taxed equally with other commodities.
Sac
As with all liberal policies, it's the good intentions rhat count not the fascist implementation nor the disastrous consequences.
As tax revenues drop, workers are laid off and stores fail, will our elected officials admit that the use of the cigarette tax to balance the city's budget was a classic example of political smoke and mirrors?
Just what did they expect? That smokers would just roll over and pay it? SHOP CHEAP! It's your Civic Duty!
Yeh, BUT...
The road to he!! is paved with good intentions. ;^)
Not so sure about that. I think that politicans are cynical money-grubbers - they see a honey pot and they just can't resist taking a mouthful, then another, and another, etc.
I've long since given up thinking politicans do anything with good intentions. The moral and ethical breaches required just to get elected efficiently weed out anyone with good intentions long beforehand.
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