Washington Report: Connecticut Seeks to Classify RYO Shops as Manufacturers

The state legislature is considering a law that would make roll-your-own tobacco shops obtain a manufacturer's license; NACS urges members to get involved at the federal level.

April 11, 2012

HARFORD, Conn. - Earlier this year, a Connecticut Superior Court ruled that roll-your-own (RYO) tobacco shops could not be called manufacturers. That hasn??t stopped the Connecticut legislature from pursuing the matter with a bill that would require such shops to purchase a $5,000 manufacturer??s license, the CT News Junkie reports.

The state had asked the court for an injunction against one RYO store, but lost when the court decided that since customers made the cigarettes, the shop couldn??t be called a manufacturer. The attorney general found that ruling too narrow to close the issue, given that the state can??t check on whether employees help customers with the machines.

The state Senate??s Finance Committee approved the measure last week, which had been proposed by the Department of Revenue Services. "Many people in our state are paying the cigarette tax as we have levied it," said Sen. Eileen Daily, who co-chairs the committee. "They still have a big number between what we hear they??re selling for and what a carton of cigarettes is selling for. So they have the ability to recoup this expense."

In Congress, the U.S. Senate tacked on a proposal that would level the playing field for all retailers selling tobacco products in the Highway bill. The House is considering H.R. 4134, a bill introduced by Rep. Diane Black (R-TN) with similar language that would provide long-term regulatory and tax certainty.

NACS urges members to contact their representatives asking for their support on this measure. Members should mention that the governors of Idaho, Wyoming, South Dakota, Arkansas and Virginia have either banned RYO machines outright or have labeled them as manufacturers and that the president of the National Fire Protection Association sent a letter to the state fire marshals in all 50 states deeming retailers that operate these machines as cigarette manufactures

"We need every bit of grassroots support we can get at this point," said Corey Fitze, NACS director of Government Relations. "We need you to get motivated on this issue in order to ensure the playing field stays level and our stores stay competitive in selling tobacco products. RYO machines might not be in your area now; however, when they are you will be losing not only a substantial amount of cigarette sales but also all of the ancillary sales that go with that basket."

Read more about RYO in NACS Magazine and in the Government Relations section.

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