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    'Operation Rollback' Launches to Fight N.Y. Tobacco Fee

    Associations join together to change the huge increase in the state's tobacco registration fees.

    NEW YORK -- Nine associations representing New York State retailers jointly launched "Operation Rollback," an industrywide drive to undo the huge increase in retail tobacco registration fees approved in the 2009-2010 New York State budget.

    Over the strenuous objections of retailers, Governor Paterson and the Legislature approved an increase from the current $100 per store per year to either $1,000, $2,500 or $5,000 annually, depending on sales volume, which includes sales of everything, even motor fuel, which typically accounts for two-thirds of gross sales of convenience stores offering gas, according to the group.

    Teaming up in the effort are the New York Association of Convenience Stores; Gasoline and Repair Shop Association of New York; Food Industry Alliance of New York State; Small Business Congress; National Association of Tobacco Outlets; Long Island Gasoline Retailers Association; New York City Newsstand Operators Association; United 7-Eleven Franchise Owners of Long Island and New York; and National Federation of Independent Business/New York.

    An online system is now activated for retailers across the state to send a pre-written message to their state Senate and Assembly Members calling for action. The address is www.votervoice.net/groups/nyacs. For background, and additional ways for retailers and others to contact their state officials, visit www.nyacs.org/OperationRollback.htm.

    "Unless these fees are rolled back, thousands of neighborhood retailers are going to have to forfeit the tobacco category," said James Calvin, president of the New York Association of Convenience Stores in a released statement. "And when that happens, many of the displaced smokers will shift their purchases to unlicensed sources of tobacco, further eroding the state’s tax revenue. In addition, with fewer customers coming through our doors, lottery sales will suffer, meaning less State revenue for aid to education."

    "No small business should be forced to pay 10 to 50 times more in license fees, especially in the midst of an economic downturn," he said. "Those fees should not be designed to punish the licensee for selling a legal product in accordance with all state regulations governing such commerce. They should reflect the State’s administrative costs associated with that registration, not business volume, and certainly not sales of products unrelated to the license.

    "It’s appalling to saddle law-abiding retailers with exorbitant fees while competing Native American stores—many of which sell 50 times the volume of cigarettes we do—are allowed to sell tobacco to New Yorkers without getting a State license or paying any fee at all," Calvin continued.

    Unless the Legislature passes a law before it adjourns June 22 to change the fee, the following fee schedule will be in effect when retailers renew their tobacco registrations for 2010, payable September 20, 2009:

    Annual Gross Sales
    -- Less than $1 million = $1000
    -- $1 million to $10 million = $2,500
    -- More than $10 million = $5,000

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