New Tobacco Tax Impacting City's Smoke Shops

by KYW's John Ostapkovich

A tobacco merchant whose shops in Morrisville are very busy due to the tax differential with New Jersey (see related story) says his store in Philadelphia is hurting for the opposite reason. 

Smoker's Palace is one of two tobacco shops right off the Tacony-Palmyra Bridge.  Owner Issam Latif says business is down since the city increased the tax because Philadelphia tobacco shops depend on New Jersey customers. Now, his price on a bag of tobacco is uncompetitive:

"I have one back in my store that costs $9.99.  I have to raise the price to $14.50. The customer told me, why should I buy from you if I can by the same bag in New Jersey for $12.99 and he's already going to save the $2 toll?"

Latif says this city tax also pushes sales into the suburbs.  That dries up the very revenue that the city was hoping to make from the tax, and could impact jobs.  He says the city is shooting itself in the foot.