Cigar Tax

One of my local B&Ms have a deal, buy 5 cigars get 1 free. However they still require you to pay tax on the one free cigar. The way there computer works, is they press a button which is tells the computer to give a discount. THe computer than asks the "cashier" which line to discount. After picking the cheapest cigar out of the bunch and entering it, the computer asks to input a tax, if any, which is to be charged on the free cigar. I notice they enter in 63%. Is this the proper tax (in New York) on cigars, or are they just trying to make a few dollars instead of none, while making it look like they arent making any? Another thing I find crazy is that they pick the cheapest cigar to discount. It doesnt matter that Im paying for 15 cigars, most of which are $10+, they still manage to discount the 3 $4 or $5 cigars I have picked out. Thats another story though.

After googling it, I found out that New York charges 37% tax on the wholesale price of cigars. So no, I don't know where 63% comes from. I would kindly ask them about it, does the total come out to about what you expect it to be?

About 90% of the stores that do a "buy X get 1 free," discount the cheapest cigar, so you're not getting ripped off in that reguard. Some places have been nice to me and discounted a mid-range cigar, but that is usually not the case.

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Originally Posted by prostartjr1738

One of my local B&Ms have a deal, buy 5 cigars get 1 free. However they still require you to pay tax on the one free cigar. The way there computer works, is they press a button which is tells the computer to give a discount. THe computer than asks the "cashier" which line to discount. After picking the cheapest cigar out of the bunch and entering it, the computer asks to input a tax, if any, which is to be charged on the free cigar. I notice they enter in 63%. Is this the proper tax (in New York) on cigars, or are they just trying to make a few dollars instead of none, while making it look like they arent making any? Another thing I find crazy is that they pick the cheapest cigar to discount. It doesnt matter that Im paying for 15 cigars, most of which are $10+, they still manage to discount the 3 $4 or $5 cigars I have picked out. Thats another story though.

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10% federal tax
53.3% New York State tax (I believe it went up to this year from 20%)

As for the buy 5 get 1 free, next time just don't buy cheaper cigars. Keep them all in the same price range so you'll make the most of the discount. They're a business, so I think it's safe to say that their policy regarding the sale is to discount the cheapest cigar.

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Originally Posted by latenightcigars

After googling it, I found out that New York charges 37% tax on the wholesale price of cigars. So no, I don't know where 63% comes from. I would kindly ask them about it, does the total come out to about what you expect it to be?

About 90% of the stores that do a "buy X get 1 free," discount the cheapest cigar, so you're not getting ripped off in that reguard. Some places have been nice to me and discounted a mid-range cigar, but that is usually not the case.

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100-63=37...maybe 63% is the portion of the cigar that you are receiving for free?

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Originally Posted by drew_goring

100-63=37...maybe 63% is the portion of the cigar that you are receiving for free?

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That's what I was thinking.


The discounting of the least expensive cigar is normal. Otherwise you would have a guys come in and buy 5 cheapies and want an Opus X for free.

The retailer I keep in touch with in California says their tobacco tax is 53%. THAT'S CRAZY TALK! I don't understand how retail shops stay in business. They'd have to start selling online and have people out of state buy their stuff.

Andrew

If you were a consistent customer, I'd be miffed about discounting the lowest priced cigar because you're clearly not, 5 acids and 1 opus please. As for taxing the free cigar, that's legal book keeping, but the tax amount should be what the state, city and county taxes are combined, and if you're not in nyc, there's no way that is coming close to 63%. They may also be charging the tax because maybe to allow smoking they have to demonstrate they sell enough tobacco.

I understand the idea behind discounting the cheapest, I just feel they should throw in atleast one mid ranged when your spending a decent amount of money. For instance one day I went in there and spent about $160 on 18 cigars. Than they take the 3 free cigars off. I think it would be be decent of them to discount 1 or 2 of mid ranged, instead of the few cheapies I had picked out. Im not a major customer for them but not a one time customer either. Im inthere usually once a week and typically spend around $100 sometimes a little more or less. I think drew maybe right with the 100-63=37. I believe the computer asks the amount to discount, they enter in 63, taking off there cut leaving 37 for the tax. I will ask about it next time I'm in there. By the way im in Staten Island, New York which I guess is new york city, not actually in Manhatten though.

I have never been to a store that offered a "Buy X get 1 free" deal and the one free was not the lowest priced item. If it was customer's choice, it would be a bunch of jackasses buying five $2 cigars and picking out the Opus for free. The store has to protect against those types of people and that seems to be the only logical way to do it.
If you are going to go in and buy 15 cigars and get 3 free, why not go in Monday and buy the five most expensive cigars and get the sixth most expensive free, then do it again Tuesday with the next 6 and Wednesday to get the least expensive. That way, you'll get one high dollar, one medium priced, and one cheap cigar free, instead of 3 cheapos. Plus, you'll get a lot of face time in the shop and they may be more likely to let you know when a box of rarities comes in.

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Originally Posted by heftysmokes

If you are going to go in and buy 15 cigars and get 3 free, why not go in Monday and buy the five most expensive cigars and get the sixth most expensive free, then do it again Tuesday with the next 6 and Wednesday to get the least expensive. That way, you'll get one high dollar, one medium priced, and one cheap cigar free, instead of 3 cheapos. Plus, you'll get a lot of face time in the shop and they may be more likely to let you know when a box of rarities comes in.

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/Agree ... though they should just give you the 5th, 10th, and 15th free so you wouldn't be forced to do that.

I am originally from the northeast and NY tobacco tax is 37% on wholesale (cost). So unless they take their true cost of the cigar and multiply that by 37%, they are making additional money. We / I always eat the tobacco and sales tax (8% NY) with buy X get Y free.....its just good business.