• Convenience Store News , Thursday, May 3, 2012 10:07 AM

New data from the U.S. Government Accountability Office show that smokers are responding to the 2009 increase in federal taxes on cigarettes and roll-your-own (RYO) tobacco by purchasing more pipe tobacco and large cigars, which are taxed at a lower rate, according to a USA Today report.

Monthly sales of pipe tobacco rose from 240,000 pounds in January 2009 to more than 3 million pounds in September 2011, while monthly sales of large cigars rose from 411 million pounds to more than 1 billion pounds. Pipe tobacco has become especially attractive to smokers who visit local stores with RYO cigarette machines, where they can make and purchase cheaper cartons of cigarettes.

Additionally, some manufacturers of small cigars increased the weight of their products so that they qualified as large cigars, therefore receiving the lower tax rate while costing much less than a traditional premium large cigar.

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