Jump to full article: Honolulu Advertiser, 2009-09-27
Author: Andrew Gomes Advertiser Staff Writer
Intro: Specialty tobacco retailers in Hawai'i are bracing for the ignition of a new state law on Wednesday that dramatically increases taxes on cigars, pipe tobacco and smokeless tobacco.
The tax hike, passed by the Legislature in May, will result in state taxes accounting for half or more than half the wholesale price of such tobacco products, with consumers paying for the hike in retail purchases.
The move comes on the heals of a federal tobacco tax increase that took effect in April, and was intended to increase revenue to the state in an effort to help balance its budget.
But the higher taxes are also expected to hurt sales for retailers already suffering in the bad economy by curbing smoking for some consumers or leading them to buy tobacco elsewhere.
"It's going to kill us," said Diane Chow, manager of Kipuka Smoke Shop in Hilo.
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