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Even after repeal, snack tax still bites

June 27, 1997

By TERRY TALBERT

Staff Writer

Maryland's 5 percent snack tax is being repealed July 1, but that doesn't mean those who get the munchies will be dropping fewer coins in the vending machine.

Officials of three Washington County vending machine firms said the tax repeal won't affect their prices.

The snack tax was levied in 1992 on potato chips and sticks, corn chips, pretzels, cheese puffs and curls, pork rinds, extruded pretzels and chips, popped popcorn, nuts and edible seeds and mixtures that contain any of those items.

Operations Manager Chuck King of Hagerstown Canteen Service said his firm's prices won't drop. "Basically, they will end up staying the same," he said.

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Hagerstown Canteen has machines in 50 locations in Washington County. King said the snack tax repeal will help his company catch up from losses sustained when snack food manufacturers hiked prices.

"We were nailed by candy, chip and pastry manufacturers about a year-and-a-half ago," King said. "We ate some of those increases, and passed on others. We absorbed what we could."

King said most manufacturer price hikes were in excess of the state's 5 percent snack tax.

Ralph Sterling, owner of Ralph's Snacks and Vending in Williamsport, is an independent operator. He said the prices of snacks he sells are already so low he can't afford to roll back prices.

Sterling said he never passed the "salty snack" tax on to customers.

"The 5 percent tax is figured in when I do my income taxes," he said. "I won't be dropping prices, because they're already so low. I try to deal more on volume than price. I have a lower overhead than some of the larger companies, so I can keep prices down."

Sterling said he has about 57 vending machines out, most of them in schools and businesses in Washington County.

"With everything going up the way it is, the prices will probably stay the same," said Terry Bartles, owner of Classic Food Service of Hagerstown. He said manufacturer prices creep up year after year. "This is a way for us to catch up," he said.

Bartles has machines in businesses in a four-state area.

Two local residents who were washing clothes at Hagerstown laundromats on Thursday said they thought the 5 percent savings should be passed on to consumers.

"The little person gets stepped on again," said Cyndy Hornbaker. "And it's the little person who uses these machines. One way or another they're going to use the money they save to better their profit situation. Isn't any doubt in my mind. The big guy always comes out on top ... I've never seen anyone cut me any slack yet."

Tim Wetzel said he sometimes puts $2 in a vending machine, and gets three or four different snacks.

"It's the same as like gas. When they drop taxes, they should drop the price, to be fair about it," he said.

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