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Tinley Tobacco Shops Tell Tale of 2 Counties Over Cigarette Tax (Updated)

A $1-per-pack tax increase was approved by the Cook County Board on Friday as part of its 2013 budget. What will that mean for village smoke shops if it passes?

UPDATED (1:01 p.m. Friday, Nov. 9): The Cook County Board approved its $2.95 billion budget for 2013 on Friday, Nov. 9, according to the Chicago Tribune. That includes the $1-per-pack cigarette tax increase. 

Smoking is an expensive habit in Cook County, and if the county board votes to approve its tentative 2013 budget during a special meeting Friday, it's about to become even pricier.

In its current form, the county budget includes a $1-per-pack tax increase, pushing the total state and county taxes on cigarettes to $4.98 a pack for residents. The hike keeps prices in the Chicagoland area some of the highest in the country, second only to New York City, according to the Campaign for Tobacco-Free Kids.

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The increase is unwelcome news for many county tobacco shops, which could see their bottom line hurt by customers going to neighboring counties—or even Indiana—where the taxes are lower.

But Tinley Park is in a unique position. The majority of the village is within Cook County. But just on the south side of 183rd Street is Will County, which has no cigarette tax. That potentially means customers might switch counties to buy their packs, but still keep the dollars going to businesses in the village.

Will County Board member and Frankfort Township supervisor Jim Moustis said many tobacco stores and gas stations in Will County already reap the profits of proximity to a taxing county. He cited the Speedway gas station at the corner of 183rd Street and South Harlem Avenue, which sits on the Will County line, as an example. The station's convenience store sells thousands of cartons of cigarettes each week, Moustis said, adding that county-line locations have attracted significant interest from developers and retailers.

READ: Is a Proposed Will Co. Gas Station-Car Wash a Bad Idea? (Poll)

But some managers of Tinley tobacco shops in Will County don't think a Cook County tax hike means an automatic surge in their business. In fact, Ali Yehia, the floor manager of Tobacco House, said it could have the opposite effect for the store, which is one of five tobacco shops clustered near the intersection of 183rd Street and 80th Ave.

When Cook County passed a $1-per-pack tax hike in 2006, Tobacco House lost 60 percent of its business to customers going to Indiana to buy cigarettes, Yehia said. The possibility of that happening again is a concern, Yehia said.

Given high gas prices and the distance to the Indiana border, tobacco shops shouldn't worry about customers heading across state lines, said George, the assistant manager of Smokes Club on 191st Street. (Editor's note: George would give his last name because of a past case of stolen identity.) However, he doesn't believe the store, which is just south of I-80, will be flush with new business.

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"I'm sure we'll get a few more customers," George said. "I don't think we're going to get an unbelievable amount of people coming to the store."

Like Yehia, George is critical of the county imposing another tax hike, saying it creates yet another obstacle for businesses that work on thin profit margins.

"You don't make a lot of money off the cigarettes," he said. "You make the money off lighters and accessories."

 

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TP Resident November 09, 2012 at 12:42 PM
This is so silly to me. Cook County thinks by raising the taxes on smokes they are going to make money. But with everybody going else where they are losing. I take a drive maybe once every two months to the Indiana border. It takes maybe 20 minutes but I am saving so much money. I figure at least over a hundred dollars. Because I do make the trip worth it and buy more than a carton. And look who is profiting not Cook County.
Harry Callahan November 09, 2012 at 01:18 PM
Bye, Bye Miss American Pie,drove me to the levy,but the levy was dry.Thank you all for taking my country away from me thats the day that I died.

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