As of Friday morning, tobacco users in Douglas County and throughout Oregon will be feeling a different kind of burn.
During the November election, Oregon voters overwhelmingly passed Measure 108, which increased taxes on cigarettes, cigars and other electronic nicotine inhalants such as electronic cigarettes and vaping liquids.
The increase includes a $2 per pack increase on cigarettes and miniature cigars, raising the total tax on a 20-count pack to $3.33. Individual cigars will see an increase of 65% of the wholesale price of the cigar, not to exceed $1. Electronic cigarettes and vapes will also see a 65% increase in the wholesale price.
Smokeless tobacco and loose tobacco — such as rolling tobacco — are not impacted by the increase.
Over the past week, local tobacco retailers have seen a run on products similar to that of a “Black Friday” sale.
“It’s been extremely busy (Wednesday and Thursday),” said Holly Burke, manager of the Mini Pet Mart on Northwest Garden Valley Boulevard. “We have almost sold out of the most popular brands of cartons.”
At Hometown Liquor & Company Store in Winston, Manager Kristie Townsend said most of the store’s cigarette inventory had already been sold, with some customers buying as many as five cartons at a time before the average carton cost of a popular brand of cigarette jumps from $65 to $85.
“Our customers have been very frustrated with the new tax,” said Townsend, who also is a smoker. “It would be one thing if the money actually went where (the government) say it’s going to go, but where is it really going?”
The increases are estimated to raise $160 million annually for the state of Oregon. Ninety percent of the tax revenues from the measure would go to the Oregon Health Authority to pay for the treatment of sick people, especially those suffering from mental illnesses. The remaining 10% would go to tribal health providers and other culturally specific health programs for tobacco cessation efforts.
Retailers will have to pay the new tax on any remaining inventory after Dec. 31, 2020, which could prove to be a significant burden for independently owned retailers such as the Company Store. In fact, the store returned all of its electronic inhalant inventory to its distributor in exchange for other tobacco products not impacted by the tax increase.
Oregon Gov. Kate Brown introduced the tax idea during the last legislative session. It was referred to the ballot along a largely party-line vote.
Taxpayers Association of Oregon urged voters to reject it saying a tax hike would hurt low-income Oregonians because they’re more likely to smoke. The group also says it would disproportionately hurt the small local shops that sell tobacco products.
Oregon has not seen a tobacco tax hike since 2002 and has one of the lowest tobacco tax rates in the United States.
Still, smokers look at the most recent increase as a form of discrimination.
Todd Watkins, of Roseburg, purchased cigarettes at Mini Pet Mart on Thursday, the day before the price increase took effect.
“It feels like taxation without representation,” Watkins said. “It just feels wrong that those of us who do smoke have to pay for everything.
“It’s a sin tax. It’s something the majority doesn’t do but the majority gets to vote on.”