Smokers hesitate to buy cigarette cartons..

March 24, 2009 - Smokers have all but stopped purchasing cigarettes by the carton in Rogers, Ark., retailers told The Arkansas Democrat Gazette. Instead, they buy packs of cigarettes in Rogers with which to get by until they can drive to Missouri, 25 miles north, where cigarettes are less expensive, by as much as $10 per carton. Wednesday, February 18, 2009 - Arkansas governor signs tobacco tax increase.. Wednesday, February 18, 2009. On March 1, Arkansas also raised the tax on other tobacco products by 36% on the selling price, up from 32%, for a total rate of 68%.

Vicky Rasnick, owner of a Jiffy Kwick convenience store in Rogers, said her cigarette sales are down about 50% so far in March. "It's awful," she told the newspaper. "Our carton sales are almost none. I've been here 22 years, and this is the worst I've seen it. This month is the single biggest hit we've ever had."

The cost of a carton of cigarettes has jumped by about $10, if not more, so far in March, said the report. Arkansas implemented a new $5.60 per carton tax on March 1, after House Bill 1204 was passed by the Legislature on February 12 and became Act 180. Adding to the burden, major cigarette manufacturers are raising prices at the wholesale level. Then federal government's new $6.17 per carton excise tax goes into effect on April 1, 2009.

Prices per carton at the Jiffy Kwick ranged from $38.99 for Sonoma to $50.49 for Marlboro, before sales taxes, the report added.

Ismail and Jodi Qasem plan to close their Balila Smoke Shop at 2500 N. 17th St. in Rogers at the end of the month. They have owned the shop since August. "I'm going to go bankrupt," Jodi Qasem told the paper. "This is our life savings right here. We were doing fine. Then it just went boom. The manufacturers started raising all the prices."

On March 9, Phillip Morris USA raised the price of Marlboro, its most popular brand, and eight other brands by $7.10 per carton. That's on top of a 90 cent per carton increase last month, bringing the price for a carton of Marlboros to more than $50 in northwestern Arkansas. Phillip Morris increased the price on 10 other brands, including Merit and Saratoga, by $8.07 per carton March 9. That move came after a $1.80 per carton increase February 9 on those 10 brands.

R.J. Reynolds Tobacco Co., which makes Camel and Kool cigarettes, raised its carton prices March 16. The increases vary from a minimum of $4.10 per carton for some brands to $7.80 for others.

Missouri has the second-lowest state tax on cigarettes in the country, the report said. It charges $1.70 per carton in state taxes, compared with $11.50 per carton in Arkansas, which is 60 cents below the national average. Theoretically, that should make the average carton of cigarettes about $10 cheaper in Missouri.

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Reference: Packing It In? Arkansas retailers reporting sharp decline in cigarette carton sales, CSP (Convenience Store Petroleum) Daily News, 3/24/2009.