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    Crossing the Border

    Cigarette tax drives Illinois smokers to shop in Iowa.

    DAVENPORT, Iowa -- For many Illinoisans, an interstate junket to their neighbors to the north and west -- Iowa -- can be profitable, especially for those looking for bargains on cigarettes.

    For example, employees at the Bridge Mart convenience store in Bettendorf, Iowa have noticed more business since July 1, when a 40-cents-per-pack cigarette-tax increase went into effect in Illinois, according to the Quad-City (Iowa) Times.

    "A lot of people from Illinois have no problem with driving over here just to get cigarettes," said Sara Wright, a Bridge Mart clerk. "They always comment on how cheap they are."

    Many border communities in Iowa have been experiencing increased cigarette sales since Illinois raised its total sales tax on cigarettes to 98 cents a pack. Iowa's tax is only 36 cents a pack. That means Illinois residents who buy their cigarettes in Iowa save $6.20 per carton.

    Though Iowa's cigarette tax has remained the same, overall revenue has increased. Iowa saw an increase of almost $700,000 between August 2001 and August 2002. On the Illinois side, gasoline stations and convenience stores are seeing more people trying to save money.

    Sue Cline, an attendant at the Mother Hubbard's convenience store in Moline, Ill., said a lot of people are switching to generic brands. "We sell more generic cigarettes than any of the name brands," she said, adding she also has seen an increase in the use of manufacturer's coupons for name-brand cigarettes. "Some people are bringing in coupons that give them $7.50 off per carton."

    But many Illinois residents are bringing their coupons to Iowa to save even more money. Gravert's Auto Service in Bettendorf, Iowa, has a difficult time keeping cartons of cigarettes in stock. "We get cigarettes in on Tuesdays and we're out of a lot of brands by Friday night," said sales clerk Joel Choate.

    Gravert's even has begun marketing to catch the attention of the increased numbers of Illinois customers. The sign outside advertises cigarette specials. "Smokers are a large part of our clientele," store manager Andrea Smiley said. "Every other person who comes in here is buying cigarettes."

    Though Iowa businesses are enjoying the increased sales, Jeneane Moody of the Iowa Department of Public Health said it would not last forever. "When a cost increase takes place, people will have an initial reaction," she told the Quad-City (Iowa) Times. "But business bleeding over into another state is usually a short-lived phenomenon. It becomes an issue of convenience."

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