Still no decision on IW cigarette tax

Published 5:39 pm Tuesday, April 20, 2021

Isle of Wight County still hasn’t decided whether it will impose a cigarette tax starting July 1.

Changes to state law enacted in 2020 now allow counties to impose taxes of up to 40 cents per pack. Should the board choose to enact the tax, wholesalers would be required to purchase stamps from the county and affix them to each pack, the cost of which would be passed on to retailers and, ultimately, the consumers who buy them.

According to Isle of Wight’s commissioner of the revenue, Gerald Gwaltney, 40 cents per pack on an estimated 750,000 packs per year sold within the county’s borders would bring in roughly $300,000 in additional revenue.

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The county held a public hearing on the matter April 15, which drew four speakers — all in opposition.

Parnvir and Manjun Dulai of Zuni own a gas station and convenience store at 5445 Windsor Blvd. near Isle of Wight’s border with Southampton County. Were Isle of Wight to impose a cigarette tax, it would “run away our customers,” Parnvir said. “They can easily hop over into Southampton County being that we’re right at the borderline if they don’t increase their taxes.”

“We are a small community; it’s a village, very low income like farmers,” Manjun added. “A lot of citizens, they are paycheck to paycheck … please do not increase the tax.”

Joel Bradshaw, who owns Bradshaw’s Country Store in Carrsville, said he and his wife have been struggling to keep up with the costs of running the business since the start of the COVID-19 pandemic last year.

“We’re behind in paying our fuel bills,” he said.

Cigarettes, he said, are the store’s biggest money-maker, bringing in $18,000 last year.

“They were a lifesaver — our cigarette sales,” Bradshaw said. “My wife and I hate cigarettes; we don’t smoke … We try to talk people out of smoking, but our sales keep going up and up, and it’s helped pay our employees.”

The lack of a county tax to date has made his store, located along Carrsville Highway between the cities of Franklin and Suffolk, popular among smokers looking to avoid paying Franklin’s 70-cent cigarette tax or Suffolk’s 75-cent tax.

“We get a lot of our customers from Suffolk and Franklin, especially Suffolk,” Bradshaw said.

“It is my understanding that the supervisors are voted into office to represent their district … nowhere did I see parental control of constituents,” said Jajala Schweigger of Breezy Hill Lane. “According to the CDC [U.S. Centers for Disease Control] 72% of smokers live below poverty.”

Those most likely to be smokers are Native Americans, people of color, the disabled and the LGBTQ community, she said.

The supervisors ultimately ended up tabling the matter pending further discussion of the county’s proposed 2021-2022 budget.

“If this isn’t going to positively impact the community to reduce any other type of taxation … and given the comments this evening, I don’t know that I support it,” said Windsor District Supervisor Joel Acree.

“I think the impact of this is going to affect our small businesses more than anybody else and I don’t see this as any more than really a penalty on them,” Carrsville District Supervisor Don Rosie said.

Hardy District Supervisor Rudolph Jefferson, however, is in favor of the tax, calling it “good for the county” and “good to maybe stop some folks from smoking.”

“Up there where I’m from, I have not heard the store manager breathe one word about cigarette tax,” Jefferson said, referring to the Rushmere Food Mart and gas station.

He also expressed doubts that a cigarette tax would seriously impact gas stations’ bottom lines.

“It’s no different than gasoline going up 15 cents over the last couple of weeks or so,” he said.

Newport District Supervisor William McCarty said he’d heard from two businesses in his district that are against the tax.

“I don’t know that I would be in support of a full 40-cent tax; I would, however, be interested in seeing the numbers on some other options,” he said.

The town of Windsor currently taxes cigarettes at 30 cents a pack, while the town of Smithfield — with towns having a higher taxing authority than counties — has set a tax of 50 cents per pack. Were the county to enact its own tax, the rate would only apply outside the towns’ incorporated borders, and not on top of what the towns already charge.

“I definitely could not support going above what Windsor is,” McCarty said.