7 News Features: Smoke & Mirrors

WSVN -- They're popping up all over South Florida, with names like "Tightwad Tobacco," "Golden Smokes" and "The Tobacco Barn." Roll-your-own tobacco shops, and smokers love them.

Carl Mathiesen has been a smoker for more than 40 years.

He's been loyal to Marlboro, but when the cigarette tax kicked in, he could barely afford a carton.

Carl Mathiesen, Smoker: "$52, $56, $60, in some cases even more."

So when Golden Smokes opened its doors a couple of months ago in Hollywood, he was thrilled.

Carl Mathiesen, Smoker: "I said, 'Let's get going here so I can roll a carton of cigarettes.'"

The shop is owned by husband and wife team Rick and Melissa Stevens.

Rick Stevens, Golden Smokes: "We do strictly roll-your-own tobacco. You come in, you buy a bag of tobacco, a box of tubes, you throw it into the machine, and about 10, 12 minutes later, you have 200 smokes."

Customers choose their tobacco from a menu, comparing what they sell to the name brands.

Then, they feed the tobacco and tubes into this machine that spits out about 20 cigarettes a minute.

Carl walks away with a carton for half the price.

Carl Mathiesen, Smoker: "So you're doing it for $24.99. How can you beat that?"

Mike Marza: "They look the same, some say they taste the same. But the difference is, this cigarette costs a lot less, because it isn't taxed."

St. Rep. Mike Horner, (R) Kissimmee: "These very clever folks have come up with a way to manufacture cigarettes and not pay taxes."

State representative Mike Horner, a republican from Kissimmee, is outraged by the practice.

He is proposing a law that would force roll-your-own shops to pay up.

St. Rep. Mike Horner, (R) Kissimmee: "They are manufacturing cigarettes, and therefore, they fall under the cigarette tax."

At issue are these giant machines. State lawmakers say they're manufacturing cigarettes, and shop owners should pay the tax like the big cigarette companies.

But shop owners say they're not making any cigarettes.

Rick Stevens, Golden Smokes: "They're trying to define us as a manufacturer. We're not. We do not manufacture cigarettes: We sell tobacco, tubes, and we rent a machine."

Rick says the customers are rolling the cigarettes and his employees never touch the machines.

But politicians like Horner say they've just found a loophole around the law.

St. Rep. Mike Horner, (R) Kissimmee: "It's quacking like a duck, it's walking like a duck, it's manufacturing a cigarette. We're going to call it manufacturing, and they will pay the same rate that other manufacturers pay."

Shop owners say the tax will put them out of business, and smokers like Carl are fuming over the issue.

Carl Mathiesen, Smoker: "Mind your own damn business, politicians. Just leave us alone."

Mike Marza: "The bill that would classify roll-your-own shops as manufacturers did not pass this legislative session. But lawmakers say this is far from over, and they will try again next year."