October 26, 2012 (Jefferson, MO) — Proposition B, a proposed 150% tax increase on cigars and pipe tobacco is causing Missouri tobacconists concern. Politicians claim the tax hike will help fund education and health care, while small business owners are criticizing the open attack on their businesses.
The International Premium Cigar & Pipe Retailers Association (IPCPR) points out that none of the tax revenue raised by Prop. B is required to be spent on tobacco-related illnesses. Instead, a board of bureaucrats directs where the money is spent, even going so far as being able to fund their own special-interest groups. The IPCPR, with over 80 members in Missouri, also fears that raising taxes on small businesses in an unstable economy could be disastrous.
Another negative effect of increasing tobacco taxes is “border bleed,” the movement of tobacco sales to neighboring states with lower taxes, ultimately harming local businesses and forfeiting the tax revenue that the Missouri state government sought in the first place.
“Most small tobacconists throughout this country are mom-and-pop operations dotting the American Main Street. In an already tumultuous economy, the government should be focused on preserving jobs, not destroying them,” said Bill Spann, CEO of the IPCPR.
The initiative will be up for vote on November 6th.