Gotham Government Relations Lobbying on Behalf of the NYSTA
May 11, 2010; Albany, NY
The New York State Tobacconists Association made its first trip to Albany today, to pursue a multitude of issues. There, lobbying on behalf of the NYSTA, was Gotham Government Relations. At the forefront of the day’s activity was lobbying against the 90% Other Tobacco Product Tax proposed by Governor Paterson on the tobacco industry.
“If this bill passes, hundreds of businesses will be shut down due to a certain lack of sales,” said Brad Gerstman, partner at Gotham Government Relations. “If this bill passes, it will be the first time in the history of New York State that a single tax adversely affects a single group of business owners, and will force these historical storefronts to close their doors after generations of business.”
By implementing this tax, not only will there be no new revenue provided for the state, but the state will also lose its existing revenue from the tobacconists.
“As a small business owner myself, I will be forced to lay off my dedicated employees, which will of course add to the high unemployment rates in a state going through one of its worst economic periods in history,” said Ron Melendi, General Manager of De La Concha tobacconists of New York City. “New York’s tobacco tax is already at 46%, which is significantly higher than our surrounding states, like Pennsylvania, which has zero tax. I already lose out to much of my business to other states for this reason. Enough is enough.”
Many other states have tried implementing a similar Other Tobacco Product Tax and failed. Washington State tried raising the OTP tax to 120%, which led to the market closing and only one tobacco store left. In New Jersey, its OTP tax went up to 45%, but the state had to lower it back down to 30% because they realized it didn’t make sense financially.
“Our clients are small business owners who make a tremendous contribution to New York’s culture and the economy; and thus, in turn, pay significant taxes to the state and local governments,” says David Schwartz, partner at Gotham. “We must stop the policies of hurting our local businesses that cater to adult clients and greatly contribute to the economy in New York State.”
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