Retailers Fighting Missouri Plan

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Retailers Fighting Missouri Plan

ST. LOUIS -- A proposed 55-cent-a-pack increase to Missouri's cigarette tax is running headlong into opposition from the state's convenience stores and is causing merchants to begin pondering consequences for their tobacco sales. An initiative petition placed the tax hike on the Nov. 5 ballot, with a goal of providing revenue for a Healthy Families Trust Fund.

The money would be directed to health-care services such as smoking prevention programs, prescription-drug assistance for senior citizens and grants for early childhood education. The increase would raise the tax to a total of 72 cents per pack and generate an estimated $342 million in state revenues, the Associated Press reported.

Despite the tax's goals, two local businesses and the Missouri Petroleum Marketers and Convenience Store Association are concerned about the measure's potential impact on them.

"Speaking as a business owner, the people are pretty well stressed out for money," John Rowe, owner of Speedy's convenience store chain in St. Joseph, Mo., told the AP. "Incomes are down, and inflation's higher. If you are a smoker and addicted to cigarettes, that is an unfair tax. It won't have a positive impact. Speaking as a citizen, the government gets enough tax, and they need to use their money more wisely."

Rowe said a tax increase may translate into smokers deciding to spend their money on cheaper brands.

An official with the state's convenience store association fears that the tax increase, representing a 324-percent hike, would drive customers from his members' establishments. The association has organized opposition to the tax increase. "It will have a drastic and negative impact," said Ron Leone, the association's executive vice president. "We may have to lay off employees" because of less customer traffic in the stores"

Leone said the state also would lose a key financial advantage of which it can boast among its neighbors. "Currently, Missouri's tobacco tax is lower than seven of our eight border states," he said. "That's a good thing. We're darn proud of it."

He said a Missouri cigarette tax increase would spell trouble for the state's economic health. For example, smokers could resort to making their purchases over the Internet, where cigarettes are cheaper and for which no taxes are levied.