Summary Box: Higher cigarette prices help Reynolds

Reynolds American, the nation's second-largest tobacco company, said higher prices on cigarettes helped lift its third-quarter net income, even though it sold fewer smokes than a year earlier. It said it earned $381 million, compared with $362 million a year ago.

CIGARETTE VOLUMES: The maker of Camel, Pall Mall and other brands said the number of cigarettes shipped fell 2.6 percent to 20.1 billion sticks. Camel volumes grew 1.5 percent, and Pall Mall grew 45.1 percent in the quarter.

PALL MALL: Market share increased 2.8 points to 7.8 percent of the U.S. market during the quarter. The company's overall cigarette market share rose slightly to 28.2 percent.

One third of cigarettes in Bulgaria are 'illegal'

Every third cigarette smoked in Bulgaria is illegal, according to the tobacco industry, because no excise tax has been paid.

Officials from four international tobacco companies and the Bulgarian monopoly have handed interior minister Tsvetan Tsvetanov a report explaining that illegal cigarettes – normally smuggled into the country or manufactured in clandestine facilities – account for 34 percent of local tobacco consumption.


No tax has been paid on one third of cigarettes smoked in Bulgaria. (Photo: lanier67)

Print
Comment article
The market research was presented by the local offices of Philip Morris, British American Tobacco, Japan Tobacco International, Imperial Tobacco and the Bulgarian company Bulgartabac.

The treasury is expected to lose the equivalent of €350 million this year just to illegal cigarettes, according to the finance ministry.

The industry carried out its research in 21 Bulgarian cities. Illegal cigarettes amounted to 50 percent of total consumption in the western towns of Pernik and Kyustendil, the survey showed.

Bulgaria is the second heaviest smoking country in the EU after Greece and consumes 350 million illegal packs of cigarettes every year, according to the study.

Assembly's cigarette tax punishes use of legal item

The Anchorage Assembly lost its collective mind when it abandoned the notion of everybody paying equally their fair share of city taxes to provide services we all receive. It now believes it can single out select, small groups using legal products and tax them mercilessly because it is, after all, best for the children.

It is cynical, predatory government at its worst.

Eight Assembly members last week voted to increase the city cigarette tax by 75 cents a pack to bring in perhaps $6.2 million. That would make the city levy on flavor cigarettes $2.21 a pack. That is in addition to the $3-a-pack state and federal taxes already in place.

Of course, the hypocrites who want you to believe the increase is aimed at stopping people -- particularly children -- from smoking are hard at work trying to justify the tax. If they were telling the truth about wanting to protect people, tax proponents would be pushing for something more draconian. The tax increase, no matter what backers say, is about easy money.

Not surprisingly, the measure was introduced by Assembly Chairman Dick Traini, who told the Anchorage Daily News the Assembly "could figure out later whether to use the new tobacco tax revenue to offset property taxes, or to restore some services." Figure out later? No kidding. Tax first, ask questions later.

Traini is wrong. Instead of whittling away at property taxes and the city bureaucracy at a time of economic stagnation, budget deficits and government bloat, he is busy trying to boost taxes on individuals whose only sin is using a legal but politically incorrect product.
Why target smokers? They represent a small group, and it is tough to defend their smoking. It is a dirty, self-destructive addiction and smokers are easy targets. But all that is a distraction that blurs the truth. What we should be howling about is government targeting specific groups for onerous taxes. If the Assembly is free to hammer tobacco users, why not people who eat fast food, drink water from plastic bottles or who voted for Joe Miller, although it may soon be tough to find any of them?

The biggest surprise in the vote was that the only Assembly members to line up against the increase -- and it truly boggles the mind -- were Elvi Gray-Jackson, Harriet Drummond and Patrick Flynn. The Anchorage Daily News even had Gray-Jackson saying, "It's simply not the role of government to tax people out of a bad habit. ... It's simply not fair."

It was the "Twilight Zone," or maybe somebody spiked the Assembly's champagne, or maybe the three represent areas of working class folks of lower economic status who, most studies show, are the nation's prime smokers. These three Assembly members usually are dead wrong when it comes to taxes and fiscal matters, but they nailed it this time. Well, kinda. Gray-Jackson also blamed the push for the tobacco tax increase on Mayor Dan Sullivan's steadfast refusal to tax to the tax cap -- that mean guy -- and Flynn thought the increase was just too much. What could the rest of the Assembly members -- some who claim conservative credentials -- have been thinking?

Worse, the tax increase could lead to even more taxes. When city number crunchers huddle to figure next year's tax cap, revenue collected by the levy will be added to the calculations and eventually help raise the cap and your taxes.

Sullivan should veto this tax even if it did win eight votes, the magic number for an override. If the Assembly wants the tax, Sullivan should make it overcome his veto so voters may remember. If a tax veto actually is overridden, the revenue should be used only to offset property taxes -- and nothing else.

A targeted, specific tax such as the Assembly's tobacco levy is just another sign that our government is out of control. The increase speaks volumes about what Assembly members think of their constituents, and it mostly is this: We can do anything we want if you do not have the votes to hurt us at the next election. What a lousy way to run a government.

If the do-gooders were serious, if all this were about saving us from ourselves, they would push for an outright ban -- but they are not. They will never kill the tobacco cash cow, no matter the health implications.

Contraband cigarettes main source of supply for Ontario youth

For Immediate Release – October 25, 2010 – (Toronto) –A new study from The Centre for Addiction and Mental Health (CAMH) found that contraband tobacco accounts for 43% of all cigarettes consumed by Ontario high school daily smokers in grades 9 to 12.

The study, published in the current edition of Tobacco Control, looked at the smoking habits of Ontario students and found that of high school daily smokers, 50% smoked at least one contraband cigarette per day over the last year. Contraband cigarettes are manufactured on and smuggled from US and Canadian native reserves and sold in high quantities at lower prices outside of the regulated environment which prohibits the sale to minors.

"This form of tobacco consumption is particularly worrisome," said Dr. Russell Callaghan, CAMH scientist and lead investigator on the study. "Because of lower prices and lack of restrictions on purchase, youth are able to afford and access them more readily than regulated tobacco products."

While the percentage of adult Ontarians who consume tobacco has declined since 2003 to 18.7%, youth smoking rates have remained relatively high at 11%. The province has made progress with tobacco control strategies such as taxation and preventing the sale of tobacco products to minors, but widespread access to contraband tobacco may undermine these gains.

"It is important to implement strict policies to regulate the cigarette manufacturing supplies going into native reserves, as well as prevent smuggling of contraband tobacco from the US," he added. This new research complements the recommendations cited in the Tobacco Control Strategy released last week by Ontario government, acknowledging that the growing pervasiveness of contraband tobacco products in Ontario needs to be addressed and combated though increased public awareness and enforcement.

Data for this study came from the 2009 Ontario Student Drug Use and Health Survey (OSDUHS), a provincially representative, school-based survey of youth attending public elementary and secondary schools in the province of Ontario.

Smoking Ban Raises Questions For Landlords

The state laws on medical marijuana have landlords in mid-Michigan confused. That's because many of them don't know how it applies to their no smoking rules.

For many smoking tenants in Michigan the days of lighting a cigaratte inside their place could soon be over. That's as more landlords consider making their property smoke free.

"It will better both our buildings, and also provide a better environment and more healthy homes for our residents," said Forrest Babcock, Lansing Housing Commission.

Thursday the Property Management Association of Mid-Michigan and the Ingham County Health Department told landlords they have the right to set these rules even if those include legalized medical marijuana.

"As a number of people said to me, we don't want to be showing our apartment to a prospective resident, and have them smell marijuana in the hallways. That is not a selling point for us," said Jim Bergman, Smoke-Free Environments Law Project.

Selling point or not, advocates for medical marijuana say these measures are not fair. Some argue that it's people's medicine. And if the law allows it then it's their right.

"If people are paying to stay at a place, that's their home. I feel that if it's your home, then you should be able to do what you vote to do. And one of them is medical marijuana," said Danny Trevino, Hydroworld.

It's a battle that could have legal consequences and one which Bergman says landlords would win.

"State law says you can be certified to use marijuana for medicinal reasons. However, federal law still says marijuana is a controlled substance which is illegal. And no question about it, federal law trumps state law," said Bergman.

Ban smoking at Memorial University

A Memorial University of Newfoundland professor is calling on the school to ban smoking on all its property - indoors and out.
Oncologist David Saltman said it wouldn't be too hard for MUN President Gary Kachanoski to enforce a ban.

"In Canada we're very lucky because if we have smoking bans in private and public places, the general population are very supportive of these and compliance is very high, so there's no need for strict enforcement," said Saltman.

Smoking is currently allowed outdoors at Memorial. Saltman said that means students and faculty are exposed to a lot of second-hand smoke near some building entrances.

He's scheduled to meet with MUN's health and safety officer about his concern in the next few weeks.

Four hundred universities and colleges in North America have banned smoking on their campuses.

General Tobacco Shutting Down

General Tobacco, a maker of low-priced cigarettes that became the sixth-largest U.S. tobacco company during the last decade, plans to shut down after failing to make payments it owed to states under an industry settlement, reported The Wall Street Journal.

General Tobacco news, Mayodan, N.C., stopped producing cigarettes and other tobacco products at its North Carolina plant several months ago and is winding down operations, J. Ronald Denman, executive vice president and general counsel, told the newspaper. He said the closely held company, which is formally called Vibo Corp., recently has been selling off inventory in foreign markets.

The maker of brands such as Bronco, Silver and GT One took market share from larger rivals after it began selling cigarettes in 200, the report said, and it posted annual sales of $335 million by 2004. But its U.S. market share fell to less than 1% from almost 2% in recent years, amid intense competition from other discounters.

Denman said General Tobacco struggled to keep its prices competitive with those of rivals such as Vector Group Ltd.'s Liggett Vector Brands Inc. while meeting the demands of the Master Settlement Agreement (MSA), the landmark pact between 46 state attorneys general and cigarette makers. Under the $206 billion agreement, companies agree to marketing restrictions and make payments to reimburse states for the costs of caring for sick smokers.

General Tobacco joined the accord in 2004, six years after it was signed by major tobacco companies, and agreed to make payments to the states for both ongoing sales and those it recorded prior to joining the agreement.