Business

Arlington Tobacco Express faces uncertain future in wake of tax law

Jill Murphy, owner of the Tobacco Express roll-your-own cigarette store in Arlington, cleans the machine that her customers use to make their own cartons of smokes. - Kirk Boxleitner
Jill Murphy, owner of the Tobacco Express roll-your-own cigarette store in Arlington, cleans the machine that her customers use to make their own cartons of smokes.
— image credit: Kirk Boxleitner

ARLINGTON — Jill Murphy, owner of the Tobacco Express roll-your-own cigarette store in Arlington, is wondering whether her business will last the 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."

Murphy is simply continuing to run her business and hope for the best, since she sees little else that she can do.

"I've heard some of my customers say that it won't be worth it," Murphy said of the price hikes that they anticipate will result from the tax. "Others have said that it doesn't matter, because of how much they love the product. We've got a lot of customer loyalty, but I don't know whether that's going to be enough to keep us going. Even with our repeat customers, we're already riding a fine margin and just barely hanging in there as it is."

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.

"I don't know what to tell my customers," Murphy said. "I know some other roll-your-own stores have already raised their prices, but we haven't. There's no way for us to pay for this on the back end. We're on the fence right now, but this could push us off."

Murphy expects to have a better sense of where her business stands by July 1, the effective date of the law, which will also be the first anniversary of when she opened Arlington Tobacco Express.

"I quit my other job and gave up my insurance to start the Tobacco Express," Murphy said. "I've given a lot of my free time to make it work. We're none of us rich people. My customers and I are all working people. They come to us because they want to save some money."

The Babas have a website devoted to the tobacco legislation at http://legislature.tobacco-joes.com.

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