Op-Ed: Tobacco tax cut will help small business

By Rep. Kevin Waterhouse

April 8, 2011

The State of New Hampshire is currently considering HB 156, a bill that would reduce the tax on cigarettes by ten cents per pack and reduce the tax on other tobacco products by 17%. As a member of New Hampshire’s small business community and as a member of the NH House of Representatives, I wholeheartedly support this legislation and was proud to vote for two weeks ago.

I own a convenience store in New Hampshire and, among other things, I sell tobacco products to my adult customers. I am not alone. In 2010 New Hampshire stores sold 128.6 million packs of cigarettes. This translates to gross retail revenue of nearly $755.8 million dollars for local retailers. Simply put, tobacco products are an important product for Granite State retailers.

In a time of historic economic downturn, it only makes sense for New Hampshire to support policies designed to grow the state’s small businesses. House Bill 156 provides an opportunity for the New Hampshire legislature to do just that.

New Hampshire has over 1,300 retail stores, 859 are convenience stores, and 607 are mom and pop operations. It is estimated that nearly 1,600 New Hampshire retailer and wholesaler jobs are supported by in-state tobacco sales. Still, New Hampshire has pursued a policy of nearly continuous tobacco tax increases over the last 5 years. When stores lose profits, store owners have two options: cut costs or go out of business. Tobacco taxes are hiked at the expense of retail jobs. I support New Hampshire’s reconsideration of this approach to tobacco taxation especially at a time when 35% of Americans believe the unemployment rate to be the most important issue currently confronting our country. HB 156 corrects the unnecessary and over reaching tax increases of the past five years and restores a pro-jobs approach to taxation.

My customers buy more than just tobacco products. They purchase coffee, sodas and many of the other products I carry to suit my customers’ preferences. As the tax on tobacco has increased over the last five years I have seen the economic effects ripple up and down each of the aisles in my store. HB 156 is an important vehicle to return this business to local retailers, and allow them to recoup revenue lost over the past five years. Passage of this legislation will support local small businesses, support the economy, and create jobs at the time when it is most needed. Similar legislation has already been introduced in New Jersey, Oregon, and Rhode Island. This legislation is good for New Hampshire’s businesses and good for the state.

I hope the New Hampshire Senate will follow suit by voting for this legislation and that the Governor will support New Hampshire retailers by signing the bill into law.

Kevin Waterhouse is the owner of Waterhouse’s Country Store in Windham, and a State Representative from the towns of Windham and Salem.


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