Higher taxes killing small business

Darrell
Darrell Cole
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AMHERST - Gas retailers are not the only ones struggling because of lower taxes in New Brunswick, but storeowner Mike LeBlanc said it's harder to get government to help because that difference is in the price of tobacco.
"It may be tobacco, but it still represents about 50 per cent of my business," said LeBlanc, who owns Mike's Drive Thru and Convenience on South Albion Street in Amherst. "I've been watching my business continue to drop because people are going across the border to buy their cigarettes."
LeBlanc collected more than 620 signatures on a petition he presented to Cumberland North MLA Brian Skabar during Nova Scotia Utility and Review Board hearings into petroleum prices last week.
In his petition, that had signatures collected from around Cumberland County, LeBlanc calls on government to conduct a review of the impact of tax differential on business in Amherst and the northern portion of the county.
Because more people are going across the border to purchase cigarettes and gas up their vehicles, LeBlanc feels the province is losing tax revenue that could be used to fund valuable public services like health care and education.
Also, while it may not be seen as the politically correct thing to do, LeBlanc feels that if government levels the playing field on tobacco tax it would bring relief to gas retailers since he feels a lot of people who go over to Aulac and Sackville for cigarettes often get gasoline while there.
He fears if something isn't done a lot of the smaller retailers on this side of the border will go out of business. He's also concerned with the deals tobacco companies are giving the larger corporate retailers.
LeBlanc attended the utility and review board hearings in Amherst and remains hopeful something will be done to alleviate the gas situation, although he's suspicious that government has already made up its mind.
"The only way they can do it is to cut the tax for all of Nova Scotia or give the retailers a rebate so they can lower the price a bit," he said. "You can't do it for one and not the other though. It's the same for me, if they gave me a tax cut on tobacco taxes in Amherst, it's not fair to the rest of the province."
LeBlanc doesn't have a lot of faith change is going to come. More likely is the scenario that New Brunswick will increase its taxes.
Paul McCarthy, a customer of LeBlanc's store, doesn't think government is listening when it comes to tobacco or gas and would be surprised if the utility and review board comes up with a solution.
"I don't have a lot of faith in them," he said. "It would be nice, but I just don't see it happening."
McCarthy doesn't see the province giving up the tax revenue associated with tobacco and gas and he's not very confident it will come up with a Cumberland County solution that places this area on a different level than the rest of the province.
dcole@amherstdaily.com

Organizations: Nova Scotia Utility and Review Board

Geographic location: AMHERST, New Brunswick, Cumberland County South Albion Street Nova Scotia

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Recent comments

  • Joe
    February 24, 2010 - 23:45

    Yes I feel for the store owner whose income is substantially dependent on the sale of cigarettes? Isn't the margin on cigarettes low in the first place? Its a wonder how that place has been open for all these years?

    Its as if lowering cigarette prices will save small businesses! I think the owner failed to mention illegal sale cigarettes as a major problem? Isn't there some way to force people to stop ordering online and buying things cheaply elsewhere close by or going on those 1/2 hour trips to the big city?

    Not much you can do, you won't stop me from shopping where I please. Whether I give my cash to wal-mart or to a different wal-mart it doesn't matter much. Cost of items is just one small part of why people shop elsewhere.

    There are no signs any small business is shutting down...everyone speaks of it as an immediate problem? Really? Amherst...stagnant growth, aging population..we had better get used to things changing.

    What did the conservatives do while in Power.......nothing...liberals....nothing but hey the NDP had the that board review it and something might possibily happen but hey those hippies suck.

  • Time to Quit
    February 24, 2010 - 23:45

    Yeah, I can't see the gov't lowering the price of cigarettes. The tax imposed act as a disincentive, a method to urge people to quit, and to prevent people from starting. Relenting on that tax would be like saying, we've change our minds and we think it's okay to smoke!

    There are a couple of things to consider here ...

    Mike has been complaining about declining business for a long time now, yet he is still in business, hmmmm? And, how come it seems like its only Mike that complains? Did buying the convenience store not work out the way you thought it would?

    Any business that relies on a discouraged product for 50% of its revenue, should be prepared for the consequences.

    Are you running a convenience store? or a smoke shop? Find other ways to increase the profitability of your store. Popcorn, movies, ice cream ... they've all been done, find a niche that nobody else is doing. Your drive thru present you with some opportunities that others don't have, so capitalize on that!

    Stop waiting for the tax fairy to grant you a wish, it's not going to happen!

  • WHATEVER
    February 24, 2010 - 23:45

    I personally don't care if they lower taxes or not, I am going to smoke regardless, so is everyone else who already does.....but Mike is right in saying that people stop and get gas while buying cheaper smokes...I myself for one do it at least once or twice a week, not to mention milk. Think about it why would anyone want to pay more for things they can buy cheaper...just common sense.

  • Ron
    February 24, 2010 - 23:45

    Back in the day, smokes and video rentals were big money makers. Not to mention illegal gambling machines. There are far less smokers and there will be even lesser when they do die off. And video rentals are a thing of the past now with video on demand and illegal downloads. And the gambling doesn't exist anymore.

    Smokes and Gas Are Different!! is right. You need to either evolve or become extinct. Find something that will provide a market for your store.

    As for downtown, it is hard to compete with chains like Needs who has a company like Sobeys to back them up. So I am not sure if a move will work.

    I think a store will work in an area where there isnt a store. Like in an area like Willow and the new subdivision. If you look at it, there really isnt a store near Willow or further east ? Lots of kids there to buy stuff IMO

  • Smokes and Gas
    February 24, 2010 - 23:45

    This is a seperate issue entirely. If Mike LeBlanc thinks that ANY provinvical government is gonna say *here you go everybody...cheap smokes!* he makes about as much sense as that grammatically incorrect sign he had up a few months ago.
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    **LeBlanc feels that if government levels the playing field on tobacco tax it would bring relief to gas retailers since he feels a lot of people who go over to Aulac and Sackville for cigarettes often get gasoline while there.**
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    Ok, but there's just one BIG problem with this, it's got something to do with that pesky thing we call mathematics:

    Only 20% of us smoke, that's 2 in 10 for those who are counting. That means that only 20% of the vehicles crossing to Aulac right now for cheaper gas are buying smokes as well. I admire Mike's tenacity, but he's totally off base on this.

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    **LeBlanc doesn't have a lot of faith change is going to come. More likely is the scenario that New Brunswick will increase its taxes.**

    By his own admission Mike knows his plan kinda out there.

    I have a better solution Mike. Your shop is in an area that most people in town have to drive to.

    It's entirely possible that you're seeing a drop in sales because you don't get much foot traffic. Maybe all of your smokes customers do drive. But, your parking lot is not very nice, especially in these winter months, which means people might be driving past your shop and onto to somewhere with a larger, easier to navigate parking lot. So your solution would be more foot traffic.

    Why don't you move the shop downtown? It would be great for the town and you would pick up the foot traffic you clearly need to keep the business going.

    These gas retailers have huge expenses associated with moving their businesses, whereas a move for you would take a hectic week and a ton of boxes. Think outside the box Mike! I think Amherst is better for having your business but you need to fight for it!

  • Fuzzy Bear
    February 24, 2010 - 23:45

    Common folks lighten up a bit. Mike is just trying to make a small business work here in his home town Amherst. Besides himself he employes several other people as well that are also involved in his battle. Remember every small business that closes adds another loss to this town. And we all know how that impacts the remainder of us that remain..... TAXES UP!!!!. Think of it for a moment...
    Yes you may pay a little more for some things in these store but if he folds and so do all the other convienience stores due to lack of support where does that leave us then. What about that cold winters night your sitting at home ready to watch a re-run on CBC because there are no video stores left. Sunday nite all the big box stores are closed and you need milk or some snacks for that 1952 golden oldie movie that CBC likes to show....have a nice trip over the ice covered snowy marsh to aulac to get those goodies.