Looming MN Cigarette Tax Hike Spurs Buying Frenzy

“In this location I’m expecting a loss of 50 to 65 percent minimum,” Hatem Younis, owner of Smokedale Tobacco, said.

Tobacco store owners like Younis are bracing for the loss of business. He’s remodeling his stores to stock more smoking alternatives, like roll your own supplies and the fast-growing E-cigarettes.

“We see the feedback from our customers and everybody is switching right now to either E-cigarettes or roll your own,” Younis said.

Sherry Dziubak and her roommate expect to save 75 percent each month by making the switch from conventional cigarettes.

Because those alternatives are taxed at a fraction of what cigarettes are, the projected $434 million in tax revenues over two years may not materialize.

“My roommate, he’s been on the roll your own for about a year and a half now — the last time taxes went up,” Dziubak said.

Added revenue from the cigarette tax could be as much as $434 million over two years, but as smokers switch to alternatives or buy cigarettes out of state, that projection could come up short.


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