Published on April 28, 2009
Joseph Hughes has been smoking for half a century. He even remembers that a carton of cigarettes could be bought for $2.50.
And he admitted he would give everything to turn back time when he had to pay $49 for a carton of Camels last month. However, the biggest shock was yet to come for him.
Due to hike in the federal tax on cigarettes that would be the largest in American history making up the price for every pack of cigarettes jump from 39 cents to $ 1.01 Smokers like Hughes began paying around $60 for a carton in Denver.
The increase that came into force last Wednesday simply destroyed lives of many smokers because cigarette were the only means to get a relaxation for those low-income people. That same store was selling it about $9 cheaper weeks ago. Jukes and other shoppers there said they feel stuck and taken advantage of.
"Those fat cats from Washington simply mocking at us poor people, who had been working for them for lives," complained Hughes, a 69-year-old retired builder who lives on Social Security.
The federal excise tax on cigarettes that cigarette manufacturers have to pay to the federal treasury, jumped by 62 cents per pack on April 1 and currently counts $1.01 per pack or $10.10 per carton.
However, leading tobacco companies like RJ Reynolds, Lorillard and Philip Morris started including the increased to the wholesale prices of their cigarettes back in March. This decision was heavily criticized by smokers and small retailers since it came absolutely unexpectedly.
The tobacco companies’ representatives stated that they had to increase prices in March in order to cope with losses, but many experts said that it was just greed and desire to earn more in anticipation of inevitable sale declines.
In case the price jump horrifies the majority of customers, 85-year-old Colorado Springs resident Cynthia Pose admits she is not so easy to be separated from her favorite habit. She said she was definitely offended by the government decision of increasing federal tax, but she would not quit for sure, because she began puffing in the tender age of 16 and has never regretted about her decision.
However, she named the tax increase "ridiculous" and said that it would destroy the tobacco industry and hurt the retailers forcing them to get out of business.
Cigarettes are not the only ones that were affected by the federal tax increase, other tobacco-containing products would cost more as well.
The revenue from the tax increase would cover the funding of State Children's Health Insurance Program expansion. The corresponding bill was legally signed by President Obama back in February. According to the program, up to 4 million children will receive free medical insurance.
Until it was expanded, SCHIP guaranteed health insurance to around 7 million children from families with an average income larger than the established in order to receive Medicaid -- the health insurance for the low-income families - but smaller to afford private health insurance.
Clive Johns, who bought two cartons of Newports at the Colorado Springs store on Thursday, said he was not frustrated with the cigarette tax hikes.
He said it would be better to tax cigarettes or alcohol instead of such essential goods like food or gas.
But other smokers were raging with anger at the same store, calling the tax increase unfair and absurd.
Rashid Ziadi who owns a convenience store in Thornton admitted that the constant tax increases will certainly ruin his business as well as the whole tobacco industry.
"If the sales drop, the revenue would be lost," he complained. "It would affect everybody – smokers, retailers and eventually the government that wanted to pick up our hard-earned money."
As for Joseph Hughes, price increases would not stop him from smoking, he said.
