Phil Accordino, president of RYO Filling Station in Girard, stands behind one of the last vending machines to roll cigarettes the company will produce. A change to federal law is forcing the company to shut down.
By Burton Speakman
bspeakman@vindy.com
GIRARD
Work on cigarette-rolling vending machines continued as normal early this week, but short of a miracle, they all will be silent and employees out of work as soon as Monday at RYO Filling Station in Girard.
Company President Phil Accordino said a federal bill taxes his machines, which help customers roll their own cigarettes, at a higher rate than manufactured cigarettes and will put him out of business. Accordino’s company makes machines that take loose tobacco and make it into cigarettes for customers.
The change to the taxes regarding loose tobacco was passed as part of the transportation bill. It creates a form of “double taxation” on the product, he said.
“All the taxes already have to be paid on the loose tobacco, then if they use the machine the taxes have be paid for a manufactured product,” Accordino said. “The companies can then request back the tax for the [loose tobacco], so companies would have to sell the product for less than they paid for it. No business is going to do that.”
Nationally RYO has placed 1,000 of its machines in tobacco stores in its 41⁄2 years in operation, he said.
The major tobacco companies thought the machines were a threat and tried multiple methods to eliminate the machines that failed before finding a congressman willing to put in an amendment adding tax to the machine, Accordino said.
U.S. Rep. Steven C.
LaTourette, R-14th, which includes part of Trumbull County, was one of the few legislators who spoke out against the change to the tax code being added to the transportation bill.
“We just didn’t feel like this belonged in the transportation bill,” said Dino DiSanto, chief of staff for LaTourette. “It’s not something that should be slipped in under the cover of darkness.”
The transportation bill includes roads and buildings. Then there is this part of the bill that changes the way a product is taxed, he said.
This was something that deserved hearings and more discussion before it was voted on, DiSanto said.
“The only hope [for RYO] is for this to be revisited in the next congress,” he said.
Even then it might be too late with RYO, and some its suppliers may already be out of business and unable to return, DiSanto said.
There have been personal use exemptions for tobacco, beer and wine for people who want to make their own since the 1950s, Accordino said.
There have also been businesses where people can make beer or wine using their own product under the tutelage of experts for years along with products to help people roll cigarettes. None of these businesses have been taxed as manufacturers.
“Our business is not tremendously innovative. We essentially stole the concept from those other industries,” he said.
Technology has existed to help consumers roll their own cigarettes since the 1920s. The RYO machine was just a more efficient model and it allowed people to not make a mess at home rolling their own cigarettes, Accordino said.
The company had 42 employees working at the Girard facility making the machines, of which 10 have already been laid off. In addition, each business where the machines are located has hired at least two additional employees to help oversee the machines, he said.
“Companies that produce supplies for the machines say we support another 400 jobs in Ohio alone,” Accordino said.
Since the rolling machines were removed from the Cheap Tobacco store, which is owned by Accordino and located next to RYO Filling Station, the number of customers purchasing loose tobacco has gone down by 60 percent, said Jessica Garland, an employee at the store.
“A lot of people have said they are going to quit [smoking],” she said.
Most of those people will come back over time, Accordino said.
“They’re just protesting right now,” he said.
The store has already laid off four workers since the machines were removed, Accordino said.
“People are supportive if they don’t have to be too vocal,” Accordino said. “We’re not the most politically correct business.”
The employees are still hopeful that something will be done to save the business, but Accordino said he does not believe it will remain open.
“In a free-market society, government shouldn’t be in the business of picking and choosing winners,” he said. “In this case, they have chosen the winners.”
Comments
They are so about saving jobs and instead they pass something that is going to put more people out of work. The little guy my have on relief for stress in this mess of an economy and that is smoking and he is able to that cheaper so lets punish him more, make it even tougher for him.
From the Montana Elder Senator's page:
http://en.wikipedia.org/wiki/Max_Baucus
Tobbacco tax / Roll your own cigarette outlawing
In 2012, after receiving donations from Altria (the parent company of Philip Morris), Max Baucus successfully pushed through Congress a transportation bill that hidden away in it outlawed "roll your own cigarette" stores by making it illegal for them to operate the cigarette rolling machines.
http://www.lvrj.com/business/roll-you...
Wonder why this was left out of the story, eh?
Wonder no more as this truly illustrates the democrat's attitude towards small business.
How many countless men and women across the country are being let go because of this government's practice of picking winners and losers.
And what was Barack Obama's attitude towards the unemployed oil men in the Gulf of Mexico due to his unconstitutional moratorium?
Let them go on unemployment, that's what it's there for.
November 2012 cannot come soon enough!
600 or so democrats were tossed out last time,
How many will it be this time?
Congressman LaTourette, goes to bat for the valley business, while timmie ryan refuses to even meet with Mr. Accordino.
timmie didn't want to po his liberal friends like Pelosi, if he appeared to help a tobacco company.
What a joke.
The "Food Stamp President" strikes again. I've never seen a president so happy to put people out of work than this one. He's is useless as racing stripes on a tank. He'll be going down as the worst president ever.
Ryan has always been a joke.
He's nothing but that a yes whimp for that crazy dry titted old bag pelosi
He's another political hack who runs his mouth about "small business being the backbone of the economy" and screws small business every chance he gets.
America was built on innovation,ambition and by those willing to take a chance and rely on their own ability and talent.
Traits clowns like ryan know nothing about because he and his kind have always lived off the govt.tit.
Pardon my stupidity, but why should these machines be tax-exempt?
If I had some hobby, like drinking Gasoline, and I was willing to put it in the bottle myself, should it be tax exempt? I am confused, mostly by the thought that these should be exempt from paying some kind of tax that is associated with pre-packaged cigarettes ...
I am sure some folks will clear that up for me in the comments below...
This is just the latest in a long line of examples of Govt. getting in the way of job creation. Timmy and Brownie must go. REMEMBER NOVEMBER.
Excuse the 'heck' out of me, but, didn't Congress, including a Republican controlled House, have to approve this before it got to the President? Republicans in the House AND Senate could have stopped this but they didn't have the guts or will power. Besides, I'm sick and tired of paying for the health care costs of smokers who think nothing of destroying their health at my expense. Cigs should all be 100 dollars a pack. So many people buy cigs before they put food on the table for threir kids. No sympathy here!
Cigarettes should be free to those who want to smoke them. It will thin the population and we will all be better off.
Keep smokin, dummies.
And fat people should be taxed 100% more on anything unhealthy. People who drive gas guzzlers should be taxed 100% more. People who dont exercise should be taxed more also ? Anyone who drinks should also be taxed more? Where do we stop? if taxes are paid when something is bought why should taxes be paid again when an item is assembled? and I am tired of these idiots that want to take away any freedom we have. TAX TAX TAX its getting outrageous.
I can't believe so many Republicans in the House and Senate voted to put people out of work. Just goes to show you how they'll treat the midle class.
If Mr. Accordino would have installed a solar panel array to generate electricity to RYO, maybe Barry Soetoro would have helped him with some Obamabucks!
Well now block50. Do you happen to drink alcohol? Do you happen to eat sugary or fatty foods, or sugar drinks? All these things have been proven to be bad for your health, yet the government still allows them to be affordable. If people want to smoke, let them smoke. It is ok for the government to let the oil and natural gas industry dump records amount of toxic chemicals into injection wells all throughout our state. The man Accordino is the modern day "Tucker" of the tobacco industry. Congress replaced private sector jobs created by a local entrepreneur, with government funded jobs. And then we listen to the tea party talk about why the national debt is so large. Let me give you a clue Congress, its because you keep killing private sector jobs and replacing the with government handouts. Uuughghgh. I give. Time to move to Canada or something. This place is most likely doomed for my children.
I hate to see this happen but it does not surprise me one bit. These small companies are a thorn in the side of big domestic tobacco companies who will look at any angle to eliminate the competition. Additionally, the loss of tax revenue to the government would not last for long either. It was a great idea built upon a sand foundation that has shifted unfavorably.
@block50
your post is so true cigarettes should be $100 a pack or more
block
Well said CongressWatcher, and block, are you not sick and tired of paying for children to have children in the hospital, paying for there welfare and food stamps, paying for there hospital bills after a gunshot wound or maybe a funeral?? If people want to smoke, it's legal, so if you don't smoke, give it a rest. Not hurting you in any way shape or form. The government already stopped smoking just about anywhere.smh at such stupidity in society today....
Bottom line of this article is the power of big businesses swaying the politicians to cut out the little ones. Isn't America suppose to be a free enterprise, help the little guy to survive, the way it's going, I don't think so.
Feed the people into the machine for big brother.......
The demoncrats will drive this country of a cliff if pelosi and her boy timmy dont get their way
I don't know if anyone has noticed lately but gov't has alot of plans in process now and in the near future to run everything about your life and how you live it. Pres. wife telling people and schools what to eat, the need for gov't to run your health care, the need for gov't to dictate how/if you run your business, etc... The plan is for us to be more like Muslim countries and only a few will rule the rest will be... well you know the rest of the story. It starts slow (like pres apologizing to arab and other countries because 'He" claims we acted bad) and before you know it its hear like "any illegal alien can freely come to our country" and we'll give you all the benefits of someone who worked all their life to get, and can't. And you want to BURN a poor business just tryin to make it and employ some people. GEEZZ People better wake up soon another 4-years and it will almost be a done deal
before you know it we will all be on food stamps, and we will be able to get beer, cigarettes, tatooes and fireworks with them.
To those saying a pack of cigarettes should be $100 and good for the government for passing this, let me see if I ha e this straight. They tax the tobacco and the tubes, you pay to use the machine and pay tax on that, now they want to tax you for a finished product as well? That's like going to Lowes or home depot, buying supplies to fix something yourself and having to pay a labor rate as well. Absolutely absurd. But its okay to have a dozen kids, get food stamps that I pay for, have a better cell phone than me, buy steaks, smoke pot, get drunk and live off the system....makes perfect sense to me. Yes, smoking is bad for you, but so is eating McDonald's/Burger king, sitting in front of a computer all day, diesel engines....you name it, life is hazardous. The leading cause of death is birth....if you're never born you can't die!!! This article is about a small business being run out by corporate tobacco and the politicians being bought by big tobacco. I thought this was a government by the people FOR the people, not against us...
Let me understand this, taxing a cigarette making machine. So the next to be taxed is the stove in a restuarant? One makes a choice to smoke. I happen to chose a restuarant to eat in. I think the govt needs to stick to the important things that are happening..
Let me understand this, taxing a cigarette making machine. So the next to be taxed is the stove in a restuarant? One makes a choice to smoke. I happen to chose a restuarant to eat in. I think the govt needs to stick to the important things that are happening..
Let me understand this, taxing a cigarette making machine. So the next to be taxed is the stove in a restuarant? One makes a choice to smoke. I happen to chose a restuarant to eat in. I think the govt needs to stick to the important things that are happening..
Sombody needs to learn the difference between "there," and "their" - not to mention "they're." You state your point with seeming authority but lose respect by not writing the English language properly. Then again - stay confused because your point is normally as valid as your spelling.
peanuts.....do you stutter?
zz3....You claim Obama apologized but PolitiFact says "liar liar pants on fire".
http://www.politifact.com/texas/state...
End-runs around diktat are verboten!! You mussst grovel!
cambridge it was on TV liar liar facts on fire
cambridge here is a link for ya (1st apology France-Our arrogance!!
http://www.youtube.com/watch?v=z3uIB6...
Don't let your beliefs outweigh the facts its killing us best to just go with what you know no matter your beliefs or political view. It's by the way not the only one.
Zz3, I am unfamiliar with this apology, was it aired on TV or did they just speak of it?
zz3....I just wasted 4:05 of my life watching the video you provided that you claim proves Obama apologized for America. He wasn't even in the video. Thanks for proving my point. I'll be waiting for you or anyone else proving video that shows Obama apologizing for America.
They should make cigarettes ILLEGAl. It is the only thing that if used as directed will kill you. Cigarettes cost this country BILLIONS annually in health care costs. I'm glad they're closing, cigarette makers are DRUG DEALERS.
has anyone paid any attention to what government federal and locals are doing? No soft drinks over 16oz no smoking dont hire people with BMI's over 30 banning salt its getting to the point where we are all going to be shopping at obamamart for things the fearless leader wants us to have. There is this thing calld freedom to choose. Well your banning alcohol should be tops on the list any criminals should be executed as soon as convicted ($49 billion per year) any special needs children should also be immediatly put away diue to costs involved. the list could go for days
Thats right sheep, keep fighting among yourselves, this really makes the man happy.
By the way Grammar Nazi , go to Hell !!!!
@ IslandMike:
The government could not stand the loss of tax revenue if cigarettes were eliminated.
When the regular tax revenue was not enough, the government perpetrated one of the biggest "legal" shakedowns of a legitimate American industry. It sued under the guise of recapturing money spent on treating "tobacco related" illnesses. That turned out to be a backhanded revenue grab, the proceeds of which have been spent more on general funding than tobacco remediation.
Tax revenue is like sex, money, and horsepower: you can never have enough.
Smoking and people who smoke are nasty air pollutors. It's good to see many quitting because they can not afford to smoke. They will live longer now. The best thing to ever happen is the Ohio No Smoking referrendum.
dd993
Are you really that bored in Life, that you read peoples comments, checking for grammar? smh at people who REALLY need a life!
I have to agree about the fact that people tell me I can't smoke because they don't want to pay my healthcare bills. But they don't mind totally supporting two generations of welfare recipients with every basic need they have. Totally ridiculous. If they did really mind they would put real limits on these funds and stop telling what I need and don't need to be a productive tax payer. I have truly about had it with congress. They can't even figure out how much tax I will owe this year and it is half over. Yet they get a raise. OMG.
Alcohol kills. Make it illegal too.
Alcohol doesn't kill unless you're an alcoholic who abuses the drug. Alcohol in moderation is actually believed to have health benefits, can't say that for cigarettes.
IslandMike is right, a little alcohol won't hurt at all unless one has an alcoholism problem.
And, cigarettes, smoked minimally, will not bother an otherwise healthy individual. The media hysteria over smoking makes it sound much more dangerous than it really is.
cambrige how about if you seen obama apolgize would you accept it then heres a link yohttp://www.youtube.com/watch?v=DAXA0WVwxiEu won't like
Get over it the debt king has spoken and you can't take it back no matter what your body wants to belive
zz3.....link doesn't work. Good job.
Smoking is still legal in this country, as long as the Government gets its fair share of tax revenue!
JoeFromHubbard:
"It sued under the guise of recapturing money spent on treating "tobacco related" illnesses. That turned out to be a backhanded revenue grab, the proceeds of which have been spent more on general funding than tobacco remediation."
That is the truest statement on this thread.
Some years ago I saved an article on the breakdown of the Ill Gotten Gains from "The Great Tobacco Heist".
Turns out the biggest recipients were the LAWYERS!
And how much went to treating so-called "tobacco related" illnesses? Hmm?
Maybe it amounted to just 5 cents on the dollar.
DwightK:
"I can't believe so many Republicans in the House and Senate voted to put people out of work. Just goes to show you how they'll treat the midle class."
Don't worry your pretty little head about any Republicans, we'll do what needs to be done about them.
Since NO democrat voted NO, what are YOU going to do, eh?
I know, you'll send a thank you note to all of the democrats who voted the correct way.
The House voted 373-52 in favor of the bill, which was supported by EVERY voting Democrat, while 52 Republicans opposed it. In the Senate, the tally was 74-19, with 23 Republicans joining EVERY Democrat in voting for the measure.
Tax On manufacturing of machines, great.
Smokers paying 100$ a pack? Great Idea bone head, your worried about jobs? How many tobacco workers would that eliminate?
Of coarse your more worried about how much it increases your heath care, but you prolly support the Obama Heathcare Plan, right.
This whole country is going to crap and you idiots are fighting each other like it will make any thing change, there is way to much governmental control as it is.
Now I am not saying there should be anarchy but what happened to our freedoms and right to choose how we live our lives?
Some thoughts for those in favor of making cigarettes 100 a pack (because THEY dont like or use them) then in all fairness all containers of alcohol need to be 100 bucks each. I'm sure a group just as large would say fast food burgers and fries should be 100 bucks too cause obesity is costing YOU money. And hey what about some of them books and games out there that can warp little minds cause mental health care costs money too. COME ON GUYS lets not make this another reason to to close off our minds. And at the risk of losing you altogether, the title for the worst president ever has already been taken.
I would like to know where everyone thats been screaming about the budget was 5 yrs ago. I never heard a word about it.