ALBANY - The New York Association of Convenience Stores (NYACS)
announced yesterday that it has succeeded in stopping New York State from
further increasing tobacco taxes and thereby "chasing more customers" away from
NYACS member retail outlets.
In the new state budget for 2012-13 that will be adopted
later this week, Governor Cuomo and the Legislature agreed to remove the tax
changes on cigars and loose tobacco the Governor had proposed two months ago.
NYACS fought these tax hikes, arguing that when tobacco
taxes rise in New York, tobacco consumers head for the nearest Indian
reservation, border state or bootlegger to avoid paying the higher tax ?"
costing convenience stores business and costing the State tax revenue.
Cigar Tax. Governor
Cuomo had proposed to tax cigars at 50% of retail value instead of 75% of
wholesale value, with distributors pre-paying a portion of that tax (20 cents
per cigar) and the retailer remitting the balance. With NYACS and
tobacco-industry allies vigorously opposed, this was dropped from the final
budget.
Loose Tobacco. In
an effort to curb the commercial roll-your-own cigarette trade, Governor Cuomo
proposed to tax all loose tobacco at $4.53 an ounce instead of the current 75%
of wholesale. That would have tripled the price of take-home pipe tobacco sold
by convenience stores, chasing those customers to tax-free outlets. NYACS
showed Albany that the plan would backfire, and it was removed from the budget.
Minimum Markup. The
state Senate had proposed increasing the handling fee paid by retail stores to
their cigarette wholesale "stamping agent" from the current 2 cents per pack to
14 cents, giving wholesalers a 600% windfall without providing any markup
increase whatsoever for retailers. Due to NYACS?? objections, this was rejected
as a budget item, although it may resurface as a stand-alone bill in the weeks
ahead.
Bottle Bill. The state
Senate had also proposed changes to the state??s Bottle Bill, including
provisions allowing distributors to pick up empties less frequently than
they??re required to now and imposing unnecessary costs on retailers who use
reverse vending machines. NYACS protested, and these changes were removed.
However, possible Bottle Bill revisions continue to be debated, and could
result in a stand-alone legislation.
Taxes/Fees. There
are no other new taxes or fees impacting convenience stores in the final
budget, fulfilling a key NYACS goal for 2012.
NYACS President Jim Calvin attributed NYACS?? budget-season
success to the active involvement of its Board of Directors and Legislative
Committee and outstanding work by its lobbyist Scott Wexler of Ostroff Hiffa
& Associates and its legislative counsel Doug Kantor of Steptoe &
Johnson. He thanked Gov. Andrew Cuomo, Senate Majority Leader Dean
Skelos, Assembly Speaker Sheldon Silve, and their colleagues for listening to
the concerns of convenience store operators about these issues.