A Modest Proposal: Mandatory Deposit for San Francisco Butts

SAN FRANCISCO, California  July 9, 2009 – Question: When is a cigarette tax not a tax?  Answer: When the city of San Francisco calls it a “fee” to pick up cigarette butts, instead.  Local cigar store owners have a better idea.

The city’s Board of Supervisors unanimously passed a scheme this week to add a 20-cent ‘fee’ onto a pack of cigarettes effective Oct. 1.  Why not call it a tax?  Because, if it were called a tax, it would be illegal.  State law says cities cannot tax cigarettes.  So, Mayor Gavin Newsom and the Supervisors positioned the tax as a ‘fee’ to help offset the $7.5 million they say it spends every year picking up spent butts.

“How double-dealing can you get?” said Chris McCalla, legislative director of the International Premium Cigar & Pipe Retailers Association.  “If the public is going to let them get away with that, perhaps they’ll like this idea even better:  Make the 20-cent per pack ‘fee’ a deposit of one penny per cigarette.  Then,  homeless or other people could collect the butts as they do bottles and cans which could be redeemed for money. 

“That would accomplish two things: it would provide income for people who really need the money and it would help keep San Francisco streets and sidewalks clean,” said McCalla with his tongue planted firmly in his cheek.

 “Unfortunately, a lot of San Francisco businesses and the city will suffer because of this so-called fee.  Any business in the city that sells cigarettes and doesn’t object to this 20-cent per pack ruse has only itself to blame when their businesses tank and they have to lay off their employees or close their doors,” said McCalla.

William F. Shughart III of the Tax Foundation – an independent, non-partisan educational organization – supported McCalla’s position by saying that “former Washington, D.C. Mayor Marion Barry… thought he could solve his city’s own budget problems by raising its excise tax on gasoline by five cents per gallon.  He was forced to rescind the tax increase within a month when revenue losses made it obvious that residents and D.C.-bound commuters were filling up their tanks in the Maryland and Virginia suburbs.”

The IPCPR is an association of more than 2,000 cigar shop owners and manufacturers and distributors of premium cigars, pipes and pipe tobacco and related items.  For the most part, these are small, family-owned businesses that employ tens of thousands of people and generate millions of dollars in state, federal and payroll taxes.

And, soon, fees in San Francisco.

Contact:
Tony Tortorici
678/493-0313
tony@tortoricipr.com