The National Association of Convenience Stores is urging President Joe Biden to reconsider the Food and Drug Administration’s proposals to ban menthol cigarettes and flavored cigars.
Doug Kantor, general counsel for NACS, sent a letter to the White House on Nov. 8 that expressed concerns regarding the bans.
If the bans are implemented, “they are likely to usher in an array of negative unintended consequences by adding to the already burgeoning illicit tobacco market, moving business away from legitimate companies to unregulated foreign producers, and removing the consumer guardrails put in place by responsible sellers like the convenience store industry,” Kantor said.
Menthol cigarettes account for 34% of cigarette sales and flavored cigars account for 51% of cigar sales in convenience stores today. Collectively, menthol cigarettes and flavored cigars accounted for $23.7 billion in sales last year, according to NACS.
“Sixty percent of American convenience stores are owned and run by single-store operators who follow age verification laws while collecting federal, state and local taxes and providing jobs in their communities,” Kantor said.
The proposed bans could cause a single c-store to lose $72,285 a year in non-tobacco sundry sales, or about 4% of inside sales, according to NACS, on top of the $160,107 lost due to the reduction in sales of tobacco products.
“The net effect of the FDA’s proposals will harm public health, increase youth access to tobacco products, make small businesses worse off, reduce tax revenues for states and local communities and enrich criminal enterprises,” Kantor said. “The robust state of the American illicit tobacco market indicates that these proposals are likely to fail on their own terms by shifting demand to unscrupulous producers and sellers rather than reducing net demand for these products.”
Alexandria, Virginia-based NACS represents more than 150,000 c-stores in the United States.
The rules to ban menthol cigarettes and flavored cigars are in the final review stage, awaiting approval from the Office of Management and Budget. The rules will likely be effective one year after publication, but that could be pushed out further, or never happen, if the rules are challenged in court by the industry.
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