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Marysville Tobacco Joe's could close down in wake of tax law
ARLINGTON — Elijah Thornton has been coming to the Marysville Tobacco Joe's roll-your-own cigarette store since it opened in August of last year, but even though he jokingly credited it with saving his marriage, he's not sure how much longer he'll be able to buy his smokes there.
"Manufactured cigarettes have have too many chemicals," Thornton said. "With these, you don't get as antsy, so my wife and I aren't at each other's necks," he laughed. "Since we started buying our cigarettes here, we haven't had an argument yet."
Michael Thorn, owner of Marysville Tobacco Joe's, signed a lease for five years at his shop's current address, but he's not sure he'll be able to keep serving customers like Thornton after this summer.
On May 9, Gov.Chris Gregoire signed into law a bill that will tax loose tobacco sold at such stores at the same rate as prepackaged cigarettes, which takes effect July 1.
Joe Baba, a tobacco distributor for Washington state who co-owns multiple roll-your-own cigarette stores in the area with his wife Kari, is considering legal action against the state.
"Like so many small-business owners throughout the state, I am still very disappointed that the legislature and the Governor would move forward with a bill written by Big Tobacco companies to make it nearly impossible for an independent tobacco shop like mine to survive," Kari McKibben-Baba said. "As of right now, we are evaluating our legal options and will determine an appropriate course of action."
Thorn is already exploring options such as reducing his customer service week to four days, but noted that his overhead is minimal as it stands.
"I move about 500 to 600 boxes a month now," Thorn said, as he considered the price hikes that he anticipates will result from the tax. "That nets me about $1,000 in profit, but a lot of that goes into paperwork and paying other bills. Not only does this cut into those profits, but it's also going to lose me customers."
While Baba estimated that a $39 carton of roll-your-own cigarettes from his store would see their cost to customers jump by about $20, state revenue officials have estimated that the average price of a carton of roll-your-own cigarettes would be $67.60, which is only $3 less than the average price of a carton of state-taxed, prepackaged cigarettes.
Thorn echoed Tim Eyman's contention that increasing fees on loose tobacco at roll-your-own cigarette shops constitutes a tax increase on tobacco, which would be a violation of a bill co-sponsored by Eyman that passed into law in 2010.
"I'm relatively confident that we'll get an injunction, but you never know for sure," Thorn said. "There were 20-some-odd states in which this same bill was introduced, and Washington was one of only a handful in which it passed. If it stands, though, I'm going to have to close in August."
The Babas have a website devoted to the tobacco legislation at http://legislature.tobacco-joes.com.