Minnesotans Scurry to Buy Smokes

Cigarette sales in Minnesota are surging in advance of a July 1 excise tax increase of $2.52 per pack.

June 11, 2013

MAPLEWOOD – A cigarette tax hike in Minnesota that takes effect in three weeks is leading to a short-term surge in demand, The Journal reports.

“We've got a few customers buying 10 cartons, 20 cartons, cases of little cigars,” said Anan Barbarawi, a store manager at Maplewood Tobacco.

While tobacco retailers are struggling to meet the current demand spike, more worrisome is the projected long-term impact on their business once the tax kicks. Cross-border tax differentials in Iowa and the Dakotas will be substantial, with each state’s taxes at least 50% less than Minnesota’s new tax of $2.52 per pack.

“Once the increase is already there, I think our business is going to die,” he said. “It's going to be a huge problem. It's going to be a life-changer,” Barbarawi said.

In the meantime, the stockpiling continues for Minnesotans. Leroy Biczkowski of Maplewood recently paid $110 for a carton of cigarettes, a purchase that will cost him more than $140 in a few weeks. He said when the tax takes effect, he’ll drive to Wisconsin to save money. “That ain’t that far,” he said.

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