ALBANY, NY - There is still time €""and a desperate need" €" for New York to join the growing list of states enacting legislation to regulate commercial roll-your-own cigarette machines, according to the New York Association of Convenience Stores (NYACS).
"The Senate and Assembly must act now to stop the spread of unregulated RYO shops, before they do more damage to law-abiding retailers, New York taxpayers, and public health," said Jim Calvin, NYACS president.
The association reports that New York RYO shops sell customers loose tobacco to feed into an on-premise roll-your-own machine that produces a carton of cigarettes in minutes. The customer pays tax only on the loose tobacco, which is taxed at a far lower rate than that for pre-packaged cigarettes. Because of the tax differential, the finished product costs less than half the price of pre-packaged cigarettes €" a big enticement for smokers.
Consequently, RYO shops are reaping enormous profits, which explains why the number of New York stores with commercial roll-your-own machines has exploded from a handful to more than 50 in just two years, and continues to rise.
In addition, RYO shops currently ignore fire safety manufacturing standards, tax-stamping requirements, Tobacco Master Settlement Agreement provisions, product display restrictions, health warning labels, minimum package sizes and minimum pricing requirements that licensed convenience stores are required to comply with.
"For example, if a state inspector finds even one pack of cigarettes without a state tax stamp in a convenience store, under state law the owner is presumed guilty of tax evasion and subject to criminal arrest," Calvin pointed out. "None of the cigarettes produced at RYO shops bear tax stamps, yet those shopkeepers risk no penalty whatsoever."
Arkansas, Connecticut, Iowa, Idaho, Illinois, Michigan, Oklahoma, South Dakota, Tennessee, Vermont, Virginia, Washington and Wyoming either have enacted legislation requiring commercial roll-your-own shops to abide by the same rules as other tobacco retailers. The state legislatures in Connecticut, Illinois and Michigan have passed legislation that now awaits governor signature for enactment. Alabama, Kansas, New Hampshire and Wisconsin have filed regulatory language regarding RYO shops.
NYACS called upon the Legislature to make RYO legislation a priority before the 2012 session ends.
"This is not about trying to put anyone out of business," said Calvin. "Rather, it is about holding everyone in the cigarette retailing business to the same standards. It's only fair."