Kansas lawmakers expected a couple of scenarios after they made the state tax on cigarettes among the highest in the nation: Tax revenue from tobacco sales would go up to help a weak treasury; and more people would quit smoking.

Nine months after policy-makers boosted the tax from 24 cents a pack to 79 cents, revenue is indeed up, though slightly less than expected. And there has been a dramatic decrease in the sales of cigarette packs.

But there is little evidence the tax has created what health advocates had hoped for: fewer smokers.

Tobacco sellers say though pack sales have dropped in Kansas they are seeing no decrease in profits or customers, thanks to a growing number of smokers who now make their own cigarettes to avoid the tax man’s heavy hand.

“A huge percentage has gone to rolling their own, which is much, much cheaper,” said Bryan Walz, who oversees 19 Smoker Friendly stores in Kansas, including a Lawrence outlet at 3010 Iowa.

Walz said that a year ago, Smoker Friendly stores in Kansas sold about 200,000 “tubes” a month. Tubes are empty, filtered cigarettes that customers fill with bulk-purchase tobacco. In February 2003, the stores sold 1,240,000 tubes — a six-fold increase.

“You can make a carton of roll-your-owns for $7 or $8,” Walz said. A carton of Camels, Marlboros or other tailor-made cigarettes now costs about $34.

“There’s also the ‘defiance factor,'” Walz said. “I hear people all the time say, ‘Screw the state, I’m rolling my own. I’m taxed enough.'”

Though carton sales are down, Walz said Smoker Friendly’s profits were up.

“People don’t believe me when I say this, but there’s not much mark-up on a carton of cigarettes.” he said. “We make more on (the ingredients in) that $8 carton of roll-your-owns than we do on a $34 carton of Camels. It sounds crazy, but it’s true. I don’t think anybody’s quit smoking because of the tax.”

Packs less popular

Vincent Piraneo, of the Smoker Friendly store, 3010 Iowa, demonstrates how to use a cigarette-rolling machine. With Kansas' increase on cigarette taxes, more smokers are switching to do-it-yourself smokes to save money on cartons.

Since lawmakers increased the state’s cigarette pack tax, pack and carton sales have declined by 19 percent, state revenue officials say.

“In the first nine months of this fiscal year — that’s July 2002 through March 2003 — about 120,000,000 packs of cigarettes were sold in Kansas,” said Steve Stotts, director of taxation at the Kansas Department of Revenue. “Sales for the same period last year were at 147,600,000 packs. That’s about a 19 percent decrease.”

Though carton sales remain steady at the Smoker Friendly store in Lawrence, Walz said chain’s carton sales statewide were down 22 percent since the tax increase took effect in July 2002.

He suspects three factors are behind the drop in sales figures registered by the revenue department:

• The move to roll-your-own cigarettes.
• Over-the-border sales — “I’m in Wichita, and I know for a fact that lots and lots of people are going to Oklahoma to buy cigarettes,” Walz said. “And in Topeka, a lot more people are going to the Indian reservations.”

Rolling cigarettes is easier now with the advent of rolling machines and tubes with the filters already installed.

Surrounding states tax cigarettes considerably less than Kansas. Missouri collects 17 cents per pack; Colorado, 20 cents; Oklahoma, 23 cents; Nebraska, 64 cents.

• Internet sales — “I hate to say it, but it’s very easy and very convenient to buy cigarettes over the Internet,” Walz said. “It’s less expensive, too.”

Falling short

Kansas’ tax on cigarettes, the 17th highest in the nation, was projected to generate $132 million in the 2003 budget year, which ends June 30. Before the tax increase, cigarette sales produced about $49 million a year for the state coffers.

¢ Kansas Lung Assn.¢ Kansas Department of Revenue cigarette taxes

Officials now say they expect to fall short this budget year by about $3 million.

To meet the $132 million projection, year-to-date collections last month needed to be $99 million.

“Though March, we’ve collected $95.9 million,” said Stotts at the Department of Revenue.

That’s not missing the target by much, said state budget director Duane Goossen.

“For tax-estimating purposes, you would not look at those numbers — missing a $132 million estimate by $3 million — and say you missed the mark or that things didn’t pan out,” Goossen said. “That’s coming in very, very close.”

In four states — Connecticut, Massachusetts, New Jersey, New York — the state tax on a pack of cigarettes is $1.50 or more.

Connecticut imposes the highest cigarette tax in the nation: $1.51 per pack.