Tobacco Tax Affecting Tulsa Businesses

By Jeffrey Smith, The News On 6

TULSA, OK -- After more than a week, the largest tobacco tax increase in history is affecting the way local shops do business.

Some Tulsa smoke shops say they normally see a spike in sales on Easter weekend, but this weekend, sales are holding steady.

Mike Newell likes to fill his Saturdays with passionate sports talk and leisurely drags on the cigar. Ten days after the tax on a stogie doubled, Newell says he's already had to make budget adjustments.

"I call it a punishment tax for those of us that have an addictive habit," he said.

Many cigarette smokers say the 62-cent spike on a pack will force their hand to try quitting.

But for specialty shops, business is holding strong, and on Easter weekend, there's a steady stream of customers.

"People who were normally buying in quantity are buying in a lot less quantity," said Chuck Kissinger, an employee at Ted's Pipe Shop.

On a $10 cigar, the federal tax used to be $2. Now, the tax is more than $5.

"With the economy the way it is, I understand the government is trying to put some money back into everybody's pockets ... and part of the way they're paying for it is to decrease one tax and increase another," Newell said.

The federal government says only two states in the country have more adults who smoke than Oklahoma, where one in four adults smokes.

State health officials say the tax already has increased volume on the tobacco hotline.

The tax increase helps fund a federal program that provides children's health insurance.

4/1/2009  Related Story: New Tobacco Tax Good For Pryor Business