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April 7, 2013

Tobacco tax hike plans raise concerns

Tobacco tax proposals concern smokers, store owners

Many smokers groaned when they first heard about a proposal to increase New Hampshire’s tobacco tax by 20 to 30 cents. But then they heard about a Massachusetts plan to raise its own tax by $1.

Maybe a 30-cent increase — or the 20-cent hike recently passed by the New Hampshire House — isn’t so high after all, they said. It just means they may not spend as much money on other items such as snacks and drinks, some said.

“That’s not bad,” Sherry Boyd, 49, said of the 20-cent increase. “But $1 is really high. Why pick on (smokers)?”

The Lowell woman was walking into Ace Discount Cigarettes at 30 Bridge St. in Pelham to pick up cigarettes.

Smokers from both states and border store owners said Friday they are not happy with the proposed increases. But they said they could accept New Hampshire’s 20-cent hike a lot easier than the proposed $1 per pack proposed hike in Massachusetts.

The president of New Hampshire Grocers Association is concerned sales of all consumer goods will be affected.

Association president John Dumais said at least 40 percent of all food store sales in New Hampshire are to out-of-staters, including many Massachusetts residents.

Raising New Hampshire’s tobacco tax would have a huge impact on those cross-border sales, Dumais said. For every $1 spent on tobacco products, approximately $2.50 is spent on other items, he said.

“Naturally, what’s going to happen is these people will come to New Hampshire less often,” he said. “And when they do come to New Hampshire, they are going to buy fewer other items.”

The bill to raise New Hampshire’s tax from $1.68 to $1.88 per pack of cigarettes is headed to the state Senate. Massachusetts’ lawmakers unveiled their proposed ax increase, from $2.51 to $3.51 per pack, last week as part of their transportation financing plan.

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