Consumer Coupons Lead to 'Tobacco Hoarding' Cases... Debate Over Need for Purchase Restrictions

Concerns over potential cash conversion due to low profit margins and ease of storage/preservation

21.48 Million Applied for Consumer Coupons in Three Days... 3.8849 Trillion Won Disbursed (Seoul=Yonhap News) Reporter Choi Jae-gu = Citizens apply for the payment of livelihood recovery consumer coupons at the Siheung 1-dong Community Center in Geumcheon-gu, Seoul on the 24th. The Ministry of Interior and Safety announced on the 24th that 21.48 million people, or 42.5% of the total eligible population, had applied for the first round of 'livelihood recovery consumer coupons,' which provide a basic 150,000 won per person, in just three days. 2025.7.24 jjaeck9@yna.co.kr

(Seoul=Yonhap News) Reporter Choi Won-jeong = Amid reports of people buying cigarettes with the 'livelihood recovery consumer coupons' distributed to all citizens to stimulate domestic demand, some are raising concerns about the need to restrict eligible purchase items.

According to Yonhap News's coverage on the 25th, citizens are flocking to convenience stores and neighborhood supermarkets instead of large hypermarkets, where consumer coupons cannot be used, and inquiries about purchasing tobacco are constant.

Mr. A, a 40-something owner of a supermarket in Yeongdeungpo-gu, Seoul, told Yonhap News, "Elderly customers have been buying two to three cartons of cigarettes since the first day the consumer coupons were distributed," adding, "We had a similar experience during the COVID-19 disaster relief fund, so we are considering ordering more alcohol and tobacco."

University student Choi Mo (25) also said, "It's very complicated because the stores that accept consumer coupons vary," and "I might as well buy a carton of cigarettes now, which I can get at the same price anywhere."

On online communities and social media (SNS), certification photos of buying 15 packs of cigarettes with consumer coupons are being rapidly shared, with captions like 'livelihood support fund despair edition.' Among some avid smokers, there's even a joke about 'smoking support funds.'

During the COVID-19 emergency disaster relief fund distribution in 2020, there was also an increase in tobacco sales. According to the Ministry of Economy and Finance, tobacco sales from May to August 2020, when the first disaster relief fund was distributed, were 1.25 billion packs, a 4.0% increase compared to 1.202 billion packs in the same period the previous year.

However, cigarettes, with a profit margin of around 5%, are significantly lower than general merchandise (20-30%), making them a long-standing 'burden' for neighborhood supermarket and convenience store owners. For a pack of cigarettes priced at 4,500 won, Mr. A earns just over 200 won.

Furthermore, experts point out that tobacco is easy to store and preserve, making it possible to convert it into cash later through 'tobacco cashing.'

Lee Hong-joo, a professor of consumer economics at Sookmyung Women's University, stated, "Since consumer coupons are a consumable asset, people are recognizing and converting tobacco, which can be stored long-term, into a stable consumer good," and "Tobacco purchases have little actual economic effect in stimulating consumption, so there is a need to restrict purchase items."

Kim Dae-jong, a professor of business administration at Sejong University, also commented, "Considering the socioeconomic costs associated with smoking and drinking, consumer coupons could have the opposite effect," and "We should refer to the case of food coupons for low-income individuals in the United States, which restricted the purchase of alcohol and tobacco, and limit purchase items before it's too late."

away777@yna.co.kr

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