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New tax could hurt Cigar factory

New tax could hurt Cigar factory - Wednesday, April 1, 2009 at 3:26PM EST

SCRANTON, LACKAWANNA COUNTY
Management and workers at the Avanti Cigar Factory in Scranton are waiting to see how a new Federal Todacco Tax will impact their business.

The tax went into effect Wednesday. It raises the cost of tobacco products by about 30%.

Dom Keating, C. E.O. of Avanti said its too soon to see if the higher prices will result in fewer product sales. But Keating said "You have to make a certain number of cigars to stay in business. If we fall below that amount its going to be hard for us to continue."

Keating said that the cigar manufacturing business use to employ about 7,000 people in Northeastern Pennsylvania. Avanti is one of the few shops left now. There are 40 workers at the Scranton plant. The company has been in business since 1912.

Kathy Williams has worked in the industry for more than 35 years. She said the tax situation 'Is frighting.' Ms. Williams said 'This is my paycheck. This is all that comes into my house. If I lose this I lose everything."

Keating said Avanti will continue to produce cigars and hope the demand for its products will be enough to keep the factory operating.
 


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