Chicago Tobacco Ordinance About Small Business, Not Big Tobacco

Restrictions proposed by Emanuel would have devastating economic consequences

Thomas A. Briant, NATO Executive Director

Chicago Mayor Rahm Emanuel

Rahm Emanuel

CHICAGO -- Chicago Mayor Rahm Emanuel continues to claim that his proposed tobacco ordinance—which would enact a new tax on other tobacco products, set minimum cigarette and tobacco prices, mandate minimum package sizes, prohibit the redemption of tobacco product coupons, and raise the legal age to buy tobacco to 21—is all about Big Tobacco. Nothing could be further from the truth.

Emanuel’s anti-tobacco campaign has included raising the cigarette tax to a nationwide high of $7.17 per pack when state, county and city cigarette taxes are all added together, imposing a tax on e-cigarettes, prohibiting the use of e-cigarettes where smoking is currently restricted, and banning the sale of most flavored tobacco products within 500 feet of schools. 

Chicago City Council aldermen acknowledge that these actions have had the unintended consequence of creating a black market for tobacco products within the city, fueled the illegal sale of single or “loosie” cigarettes on the streets, forced Chicago residents to travel outside the city to buy their preferred tobacco products, and cost retail stores sales and employees their jobs.

The latest tobacco restrictions proposed by Emanuel would have further devastating economic consequences to small convenience stores, tobacco stores and corner markets that sell tobacco products. The irony of the proposal is that while retail compliance checks conducted by federal and state agencies show that a very high percentage of retailers do not sell tobacco to underage youth, most of the proposed restrictions and prohibitions will fall hardest on these law-abiding retailers.

The mayor’s assertion that he is advancing these prohibitionist restrictions because of Big Tobacco fails to grasp several realities including the origin of the current Chicago tobacco black market being a result of the mayor’s previous initiatives against tobacco and the fact that the vast majority of retailers are complying with the law, usually to their own economic detriment.

Chicago pastor Roosevelt Watkins III in a recent opinion piece acknowledged that these new proposals will only exacerbate the marketplace for retail stores. The pastor writes: “The proposal will also impact local businesses in these communities that will not be able to compete with prices in the suburbs or Indiana. As a result, jobs and opportunity in these communities further disappear with exorbitant taxes and fees.”

With retail stores already struggling to survive within Chicago’s city limits, retailers, retail, wholesale trade associations and NATO are fighting back. Because a parliamentary maneuver during the February Chicago City Council meeting delayed the vote on Emanuel’s proposal until the March council meeting, retailers now have additional time to educate aldermen about the devastating impact of the mayor’s proposed restrictions.