Convenience Stores in Yakima Say Tribal Smoke Shops Have Unfair Advantage
YAKIMA, Wa - This issue of taxing cigarettes has been a sore subject for local businesses that are not on the reservation. They say it's an unfair tax advantage that is costing them money and hurting the state's economy.
For convenience stores like Hy's Grocery in Yakima, cigarette sales help to light a fire under their bottom line.
"Some people have gas, we've got cigarettes," says Tim Jordan, the store's manager.
Looking at overall annual sales for Hy's Grocery, Jordan says cigarettes sales amount to 30%, but they only make a 5% profit off cigarettes. That's because they have to pay state and federal taxes.
"It's unfair tax advantage that smoke shops on the reservation are receiving," says Jordan.
While Hy's Grocery doesn't make big money off cigarettes, they do bring people into the store. If businesses on the reservation sell tax free cigarettes to non-tribal members, customers are more likely to go there to buy cigarettes and other items that go along with it.
Jordan says it creates a domino effect which could smoke the state economy in the long run.
"If you can save 70 cents on a pack, you are more likely to buy a soda or a candy bar there. People may not do that here because they can't afford both, or they know where they can it cheaper."