Increasing tobacco and alcohol taxes would hurt everyday Kansans, tobacco and alcohol retailers say.
Gov. Sam Brownback on Wednesday proposed doubling the tax rate of alcohol, adding a dollar to the taxes on cigarette packs and doubling the tax rate on other tobacco products.
Health officials are lobbying for an even higher tax increase for cigarettes, saying it could do more to discourage teens from starting smoking and encourage others to quit.
Though tax increases would not be good for their businesses, Wichita tobacco and alcohol retailers said the taxes would be most harmful for consumers.
“He’s putting the mess we’re in on the backs of middle- and lower-class Kansans,” said Jeff Breault, owner of R & J Discount Liquor near Douglas and Hillside, which sells tobacco products as well.
The proposal, meant to address Kansas’ budget deficit, would take the alcohol tax from 8 percent to 16 percent. The tax would generate $107 million over two years, according to the proposed budget.
Customer Stephen Netherton, who favors high-end alcohol, said prices for drinks like bourbon are escalating on their own, and a tax increase would make that worse.
“It will create a situation where people like me, who frequently buy high-end drinks, will look at other states,” Netherton said.
Breault worries for liquor businesses near the state’s borders, including those in Sedgwick and Cowley counties.
“We’re 30 minutes from Oklahoma, so what’s to stop people from taking a quick drive across the border to buy their liquor?” he asked.
Because of that, the state itself would eventually be hurt by the tax, as more and more people go to other states to buy alcohol, Breault said.
Whitney Damron, a lobbyist for the Kansas Association for Responsible Liquor Laws, a group that represents liquor stores. said the proposed tax increase is unjust.
“A 100 percent increase in the (liquor) enforcement tax is inappropriate,” he said. “The people being asked to fix the problem aren’t the ones who caused the problem.”
Tobacco seller Jerry Johnson of the Central Smoke Shop said he thinks a tax increase would mostly hurt his customers.
Under the proposal, the tax rate for tobacco products, excluding cigarettes, would go from 10 to 20 percent. Cigarette taxes would go from $1.29 to $2.29 a pack.
Tobacco taxes increase so regularly, Johnson said, that he thinks he knows what would happen.
“It never changes anything,” he said. Customers “complain, but they still buy.”
The proposed increase in tobacco tax may not be high enough for advocates of the tax. A coalition of Kansas health organizations released a statement Wednesday seeking an increase of $1.50 per pack. They also asked that $5 million of the resulting tax revenue be allocated to resources for quitting tobacco use.
“This proposal not only brings in dollars to help address the state’s budget shortfall, but makes sense with substantial health benefits for Kansans of all ages,” the release said. “A $1.50 tobacco tax increase will likely prevent 16,200 Kansas youth from ever becoming adult smokers and prompt 20,000 adults to quit.”