Five customers walked out the door of Roll N’ Smokes sad and without their favorite cigs. “Every day tobacco sales, we went from benefit likely to be closed to $1,000 a day and now we are doing approximately $100 per day after overhead,” owner Rob Bitz declared on Friday while sitting at one of the tables in the business, situated near Corunna and Linden roads. “It’s possible 80 to 90 per cent decrease in cigarettes income. That’s why we are bringing in more things. We need to get it up more to 30 40 per cent benefit margin to stay in tobacco business.”
Bitz, who owns roll-your-own cigarette shops in Flint, Owosso and Lansing, is struggling to keep afloat following federal and state regulations that first increased taxes and then criminalized machines that permitted smokers to make their own cigs.
It was in June when the Gov. Rick Snyder signed a law that obliged smoking products from the machines to comply with all taxes imposed on tobacco products. The state estimated cigarette makers pay $35 more in taxes per carton of cigs.
Less than a month later, a federal ordinance which banned the machines was signed by President Barak Obama. Supporters of the legislation argued that there was a gap permitting the businesses to escape paying federal taxes on tobacco for cigarettes, not for pipes.
Loose pipe tobacco is taxed at a $2.83 a pound, while loose cigarette tobacco is taxed at a rate of $24.78 a pound.
Removing the use of the machines has resulted in a severe decrease in tobacco business, declared Bitz, who opened his shops in 2010.
“We’ve had to cut people’s jobs, we’ve had to reduce hours, we’ve had to invest in a lot of money,” he added.