New Jersey Tobacco Retailers Loosening Up

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New Jersey Tobacco Retailers Loosening Up

ATLANTIC CITY, N.J. -- The Chelsea section of this Atlantic City, N.J. is speckled with small, ethnic convenience stores and grocery markets. And while each of these markets provides its own unique offerings, bags of exotic spices from Pakistan or Jamaica, fruits and vegetables from Puerto Rico, most of them share a common secret.

Neighborhood residents, whose names and faces are familiar to shopkeepers here, can drop a few pieces of spare change on the counter and be rewarded with a loosie, reports the Press of Atlantic City. Usually, 30 or 50 cents will do, and the clerk will offer a box from which the customer can pull one loosie. The transaction is completed with a courtesy "need a light?"

Loosies are not a new and powerfully dangerous drug. They are, in fact, an old and familiar addiction, reaching the poor and money-minded in a new way. Loosies, as the name implies, are cigarettes, sold one-by-one from the pack. Loose cigarette sales, shopkeepers believe, are illegal. Most storeowners will not sell them to outsiders. Those that will, do so with some reluctance.

"Somebody told me it's against the law to sell them," said Asshok Patel, a clerk at the Crescent Market. "My consensus is you're not supposed to sell loosies, and I have my own principles, so I will not sell them."

Ruben Franco, a clerk at the Nashville Market, just across the city line, in Ventnor, said he would like to start selling loosies. "I'm going to make more money if I do. It's like a 100 percent profit," said Franco

A pack of brand-name cigarettes costs close to $6. With a mandatory state tobacco tax of $2.05 per pack, and stiff competition from other retailers, stores rarely price their smokes more than the state minimum of $5.48. Loosies sales, on the other hand, offer a greater profit. Twenty cigarettes, sold at 50 cents apiece, net a $5 return. "To sell loosies, you're going to make a 100 percent profit. But if you sell a whole pack, you're only going to make a 10 to 15 percent profit. It's much better to sell loosies," said Franco.

But the threat of getting caught prevents some shop owners from selling loose cigarettes. Franco said the Nashville Market temporarily lost its cigarette license -- "a problem with the taxes" -- and the owner would not want to risk another suspension. That's where Franco and Patel are misinformed.

Take the Atlantic Deli and Grocery for instance. Ask a clerk there for a loosie and he'll likely respond with "short or long?" -- that's smoker-speak for regular length or 100s. If menthol cigarettes won't do, the clerk there will gladly sell you a Camel, or a Marlboro or whatever other brand is available.

Manan Sumon, a 24-year-old clerk at the Atlantic Grocery said he doesn't think the practice is illegal. He said loosies are the latest form of bumming a smoke -- cash-strapped smokers are not likely to give up a free cigarette at current prices -- and storeowners are just cashing in on the phenomenon, the report found.

And Sumon is right, according to the New Jersey Department of Treasury. Retailers are allowed to take a pack of cigarettes from their stock and then sell each one individually as long as they charge the mandatory 6 percent sales tax and report the sale, according to Matt Golden, a spokesman with the state's Division of Taxation. He said the tobacco tax was paid in full when the shop owner bought the pack from a wholesaler.

"We prefer they didn't sell them," said Golden. "It just creates more work for us. We would prefer they sold them in the pack."

If the state were to audit the store, the owner would need to provide proof that the tobacco tax was paid. But, in the end, the practice is perfectly legal. Shopkeepers can keep their loosies in a box under the counter, on a display shelf, or in a bowl or cup right out in the open.

Back in Chelsea, Praful Desai, a clerk at the Dollar Express market, said customers can buy loosies there for just 30 cents, tax included. "Customers usually buy four to eight cigarettes, not really one at a time. They know we sell them here, and they come in to get them when they need to," said Desai.

The three or four open packs are visible from the counter. So too is the tab sheet where clerks write down how many loosies are sold each day. "The owner wants to make sure everything is done right," said Desai.