Through the years, my business’ bottom line has been chipped away at while Illinois lawmakers look for ways to improve our budget crisis. With Gov. J.B. Pritzker’s recent proposal to increase the state’s cigarette tax by 32-cents a pack, the outcome will not only have a detrimental impact on my business, but will allow more cigarettes to be smuggled in Illinois while the state loses out on revenue.
The last time lawmakers increased the statewide cigarette tax, my business lost a third of its sales from cigarettes. While some lawmakers may see this as a victory claiming it will save the state on healthcare costs, there is ample evidence that shows Illinois consumers continue to smoke and simply choose to travel to neighboring states to purchase cigarettes where they are cheaper.
The impact of the cigarette smuggling is staggering, with an estimated $7 to $10 billion in state and federal tax revenue lost each year because of it, according to Bureau of Alcohol, Tobacco, Firearms, and Explosives. And this trend isn’t just felt in border communities. One of my businesses, Luka General, sits at the exact halfway point between Missouri and Indiana, and consumers here do the same.
While I understand the state’s financial challenges, this proposed solution does not solve the state’s budget gap. It will result in a budget hole and more taxes on businesses that impact our bottom line.
Owner of Luka General, Kinmundy General, and Omega General retail stores. Luka General is located at the halfway point on US Highway 50 between Vincennes, Indiana, and St. Louis, Missouri.