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Clint Keller | The Journal Gazette
Judy Mason stocks up on cigarettes Tuesday at Burger’s Discount Tobacco on Wells Street to avoid having to pay the tax increase that begins today.

Tax-weary smokers stock up, weigh options

The managers of Low Bob’s Discount Tobacco on Goshen Avenue want their customers to know who is responsible for the massive increases in tobacco prices that customers will see today.

“Please Don’t Blame Us,” reads a printed signed taped to the counter. “Blame Barack Hussein Obama, Sen. (Evan) Bayh, Sen. (Richard) Lugar and Marlboro. These are the people who raised these prices.”

Smokers were stocking up Tuesday and weighing their options, the day before the biggest single federal tobacco tax increase took effect.

The federal tax on each pack of cigarettes will increase from 39 cents to $1. The tax on most other tobacco products will also increase. The large-cigar tax will increase from 21 percent to 53 percent. Taxes on smokeless tobacco will go from 60 cents a pound to $1.50 a pound.

Jeniffer Hoffman, 30, walked out of the store with a grocery sack full of “roll-your-own” tobacco. Taxes on that type of tobacco will increase from slightly more than $1 to nearly $25 a pound.

The government hopes the new taxes will raise nearly $33 billion to pay for an expansion of the State Children’s Health Insurance Program.

Hoffman said she likes the idea of the money going to pay for children’s health insurance but said the tax increase will make her life more difficult, especially during tough economic times.

After her stockpile of tobacco runs out, Hoffman said she will have to figure out whether she can afford to smoke any longer. If not, she’ll be forced to quit.

That is what the American Lung Association of the Upper Midwest hopes she and other smokers do.

The Lung Association applauded the tax increases and urged state legislators to pass even higher taxes in an effort to pressure smokers into quitting.

Indiana has the sixth-highest smoking rate in the country, with about one in four Hoosiers lighting up, according to the Kaiser Family Foundation.

But John Kessler, an economics lecturer at Indiana University-Purdue University Fort Wayne, said the new increase is more complicated than a simple sin tax – a tax levied to discourage a certain behavior.

President Obama’s administration is banking on the revenue from the new cigarette tax. If too many people quit smoking, the money for the new program will dry up, Kessler said.

“They’re counting on people being so addicted to cigarettes that they don’t stop smoking,” said Kessler, who studies economics and public policy.

Meanwhile, customers continued to stream in and out of Low Bob’s, hoping to save money by stocking up before the new taxes.

“It’s good business today,” employee Adam Pence said. “But it’ll probably be dead tomorrow.”

mzennie@jg.net

The Associated Press contributed to this story.