August 30, 2014

Omaha looking at new tax on cigarettes to fund UNMC’s new cancer facility

The Omaha City Council is considering a proposal that would implement an occupation tax on the purchase of cigarettes to raise the $40-million promised to the University of Nebraska Medical Center for the construction of a new cancer center. The proposal calls for a $.35 occupation tax per pack.

Several years ago Omaha implemented a 2 1/2 percent occupation tax on food sold in restaurants and on bar tabs and that generates about 25-million dollars each year for the city’s use.

Douglas County was also asked by UNMC to fund the center and is looking at using inheritance tax money to fund the project. They could vote on the proposal Tuesday.

This has tobacco shop owners like Bob Wagner very concerned. He owns a Tobacco Outlet store in Omaha and fears that many of his customers will go outside the city limits to buy their cigarettes and that could put him out of business. Wagner says about 35% of all sales at convenience stores is from tobacco and he says that will impact their bottom line as well.