Bill Mandates 15 Percent Markup On Cigarettes

May 19, 2017

A new bill introduced in the House aims to give small business owners an even playing field when selling cigarettes. The bill mandates a 15 percent markup on retail cigarette prices.

The proposal would amend the state’s Unfair Sales Practices law, which stops big retailers from selling merchandise for less than what it cost them. The law is intended to help small retailers remain competitive.

“It protects them from large businesses because they don’t have the scale that the larger retailers do,” said Rep. Robert Phillips (D- Woonsocket), who introduced the bill. “In the sale of cigarettes, just the fees for accepting a debit card can wipe out any profits a retailer makes, and that’s unfair.”

Most states with similar unfair sales laws do include additional markup requirements for cigarettes. Massachusetts, for example, requires a 25 percent markup on cigarettes.