Thursday, June 18, 2009
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From a press release from the IPCPR
Sacramento, California June 18, 2009 – California legislators are grasping at tax straws that don’t exist as they seek to raise billions of dollars that don’t exist for a balanced state budget that doesn’t exist, according to the International Premium Cigar & Pipe Retailers Association.
Two legislators – Democrat Assemblyman Tom Torlakson of Contra Costa County and Democrat State Senator Alex Padilla of Los Angeles – have introduced AB89 and SB600, respectively. The bills propose to increase tobacco taxes to as much as $2.10 per pack of cigarettes on top of the current $.87 per pack state tax and recently increased federal taxes of $1.00 per pack plus correspondingly stiff increases on other tobacco products like cigars and pipe tobacco.
“It’s easy to call these ‘tobacco taxes’, but the truth is they are discriminatory taxes that target some 15 percent of California adults who enjoy tobacco in one form or another , whether they smoke cigarettes or savor hand-made cigars” said Chris McCalla, legislative director of IPCPR.
“Real people pay these taxes… real people at all economic levels who vote and who have had enough overspending by government. They are customers of our more than 200 members throughout the state of California who are smoke shop owners and manufacturers or distributors of premium cigars and other tobacco products. They are, for the most part, small, family-owned businesses that employ thousands of their neighbors. As taxes go up and sales go down, their businesses are as threatened as the jobs of their employees and the sales, income and other taxes collected by the local, state and federal governments,” McCalla said.
Proponents of increased tobacco taxes claim they will make it more difficult for under-aged individuals to purchase cigarettes.
“Higher taxes do not make it more difficult for teen-agers to purchase tobacco… they only make it more expensive for them and everyone else. If we want to keep kids from smoking – and we agree that everyone should support that goal - we should be enforcing the laws that are already on the books as do all members of the IPCPR,” said McCalla.
McCalla disagreed with an editorial in a California newspaper (Wednesday, June 17, Los Angeles Times) that said increasing state tobacco taxes would be a “fair and constructive” way to find “balance” for the budget.
“The bills’ sponsors are estimating that these new, taxes on 15 percent of Californians might generate up to $2 billion as the state seeks to fill its $24 billion deficit. That is anything but fair, constructive or balanced,” McCalla said.
Here is the original LA Times Opinion piece entitled Taxing Tobacco. Thankfully it appears that the Govenator will veto Democrats’ plan for a balancing budget that relies on levies intended to raise $1.9 billion in new taxes on oil and tobacco, and fees on motorists to fund state parks, that Schwarzenegger said would be unfair to Californians after higher taxes were imposed on them in February.
"None of that will fly with me," the governor said. "It will be irresponsible after the largest tax increase in California's history just four months ago to go back to the people and to say we want to increase your taxes but we want to protect the salaries of state workers."
Stand up for your rights. Let Schwarzenegger know you support his veto and contact your state representative and senator and let them know you will NOT be taxed unfairly just be cause tobacco is considered an easy, PC target!
Monday, February 23, 2009
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Tobacco users unfairly bear the burden of supporting expansion of this program!
In case you’ve been living under a rock lately, you’ve probably heard that this unfair taxation act has passed. The Children’s Health Insurance Program Reauthorization Act of 2009 (Public Law 111-3) that was signed into law by President Obama on February 4, 2009.
You can find a summary from the TTB.Gov site at http://ipcpr.org/legislation.html. While they haven’t yet published the required rulemaking documents about the implementation of the provisions of this Act.
The Act increases the Federal excise tax on all tobacco products and cigarette papers and cigarette tubes, effective April 1, 2009. In addition, the Act imposes a floor stocks tax on all tobacco products (except large cigars), cigarette papers and cigarette tubes held for sale on April 1, 2009. A floor stocks tax is a one-time excise tax placed on a commodity undergoing a tax increase. The amount of the floor stocks tax is equal to the difference between the new tax rate and the one just previous to it. Any person who holds tobacco products (except large cigars), cigarette papers, or cigarette tubes is liable for the floor stocks tax on April 1, 2009.
Here is their graph of how the taxes, and the anticipated floor tax, will break down:
| Tobacco Product | Tax Rate effective March 31, 2009 | Tax Rate effective
April 1, 2009 | Floor Stocks Tax Rate (difference between
the rates) | | Small Cigarettes - Class A (Weigh 3 lbs. or less per 1,000) | $19.50 per 1,000 equivalent to:
$3.90 per carton $0.39 per pack | $50.33 per 1,000 equivalent to:
$10.066 per carton $1.0066 per pack | $30.83 per 1,000 equivalent to:
$6.166 per carton $0.6166 per pack | | Large Cigarettes - Class B (Weigh more than 3 lbs. per 1,000) | Up to and including 6½” long: $40.95 per 1,000 | Up to and including 6½” long: $105.69 per 1,000 | $64.74 per 1,000 | | Over 6½ “ long: Each 2¾” counts as 1 paper, then $19.50 per 1,000 | Over 6 ½ “ long: Each 2¾” counts as 1 paper, then $105.69 per 1,000 | Over 6½” long: $64.74 per 1,000 | | Small Cigars (Weigh 3 lbs. or less per 1,000) | $1.828 per 1,000 | $50.33 per 1,000 | $48.502 per 1,000 | | Large Cigars (Weigh more than 3 lbs. per 1,000) | 20.719% of sales price but not to exceed $48.75 per 1,000 | 52.75% of sales price but not to exceed $0.4026 cents per cigar (or $402.60 per 1,000) | NOT PART OF FLOOR STOCKS TAX | | Chewing Tobacco* | $0.195 per pound | $0.5033 per pound | $0.3083 per pound | | Snuff* | $0.585 per pound | $1.51 per pound | $0.925 per pound | | Pipe tobacco* | $1.0969 per pound | $2.8311 per pound | $1.7342 per pound | | Roll-your-own tobacco* | $1.0969 per pound | $24.78 per pound | $23.6831 per pound | | Cigarette paper | Up to and including 6 ½” long: $0.0122 per 50 | Up to and including 6½” long: $0.0315 per 50 | $0.0193 per 50 | | Over 6 1/2“ long: Each 2 ¾” counts as 1 paper, then $0.0122 per 50 | Over 61/2“ long: Each 2 ¾” counts as 1 paper, then $0.0315 per 50 | Over 6½” long: $0.0193 per 50 | | Cigarette tubes | Up to and including 6½” long: $0.0244 per 50 | Up to and including 6½” long: $0.0630 per 50 | $0.0386 per 50 | | Over 6½ “ long: Each 2¾” counts as 1 tube, then $0.0244 per 50 | Over 6½ “ long: Each 2¾” counts as 1 tube, then $0.0630 per 50 | Over 6½” long: $0.0386 per 50 | | |
Wise smokers of cigars and pipe tobacco will want to contact their local tobacconist before April 1, 2009 in order to stock up on their supplies before the taxes take effect. Not only will they be saving money, but hopefully help their struggling local tobacconist out by reducing their floor tax exposure on items that aren’t considered Large Cigars.
Friday, December 12, 2008
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It isn’t “about the children” as the sound bites might indicate. What it is about is the unfair taxation of a small portion of the population to fund a program that affects ALL of the citizens of the US.
The following is a press release from the National Association of Tobacco Outlets advising all responsible consumers of tobacco products to make their voices heard on this subject. It is imperative that we all band together and speak out against this unfair taxation of a small segment (less than 10%) of society for a program that has universal concerns. Why put this on our back?
A Call to ACTION on SCHIP Tax Increases!
If Congress passes a bill early in 2009 to expand the State Children’s Health Insurance Program (SCHIP) by significantly increasing the federal cigarette and tobacco taxes, the fallout from this expansion of government subsidized health care will likely include major cigarette and tobacco sales reductions, large increases in the number of store robberies because the value of tobacco products would be so high, a floor stocks tax on cigarette and tobacco inventory adding up to an estimated $5,000 per store, employee layoffs and even store closings.
The SCHIP program is a top priority for Democrats and may result in the single largest tax increase on one industry’s products in the history of the country. With President-Elect Obama a supporter of SCHIP, the possibility of a tobacco tax increase to fund the expansion looms large even though Obama made campaign promises not to increase taxes on any one who earns less than $250,000. The 2007 SCHIP bills proposed the following increases in the federal tobacco excise tax rates:
| Tobacco Product | Current Tax Rates | SCHIP Bill Tax Rates | Percentage Tax Increase |
| Cigarettes | 39¢ per pack | $1.00 per pack | 156.4% |
| Large Cigars | 20.719% of manufacturer’s price; cap of 4.875¢/cigar | 53% of manufacturer’s price; cap of $3.00/cigar | 6,000% |
| Little Cigars | 4¢ per pack | $1.00 per pack | 2,197% |
| Pipe Tobacco | $1.0969 per pound | $2.8126 per pound | 156.4% |
| Chewing Tobacco | 19.5¢ per pound | 50¢ per pound | 156.4% |
| Snuff | 58.5¢ per pound | $1.50 per pound | 156.4% |
| RYO Tobacco | $1.0969 per pound | $8.8889 per pound | 710.36% |
The Time to Act is NOW!!!
NATO’s legislative staff members are sending out to association members customer alert sheets to place on store counters and personalized letters addressed to each retailer and wholesaler’s particular U.S. Senators and Representatives. NATO members need to call their Congressional representatives, urge their employees and customers to do the same and fax the personalized letters to Washington, DC. All the names, phone and fax numbers of the particular Congressional representatives are being provided. NATO members need only dial the phone and fax the letters. Your voice and the voice of your customers need to be heard.
Turbulent Time for Tobacco Requires Grassroots Efforts
No one can say with 100% certainty how the SCHIP legislation will finally be resolved by Congress in 2009. What can be said is that the SCHIP bill is just the beginning of what will be a turbulent year for the tobacco industry. With some in Congress supporting federal cigarette and tobacco tax increases to expand SCHIP and more than 30 states with large budget deficits some of which will also propose higher tobacco taxes as well, NATO wants to remind its members that they must continue to contact their elected officials to be heard on tobacco issues. Maintaining that dialogue and urging customers to make phone calls continues to be an important part of opposing unfair tobacco legislation.
So don’t sit by idly and watch your tobacco products get taxed by an increase of up to 6000%, write, or better yet, call your local congress person or senator and let them know that this is just plain WRONG!
Friday, November 21, 2008
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Industry Lobbyists' Consensus Sees Compromise Holding For Next Round of SCHIP Deliberations
November 21, 2008 - As rumors continue circulating about SCHIP in 2009, CAA's and IPCPR's lobbyists, along with several industry consultants, met to share new information and prognostications regarding legislation to renew and expand the State Children's Health Insurance Program (SCHIP).
While tempered with a bit of caution, all parties participating on the conference call remain confident the compromise that was reached and agreed to by Congressional leaders will be incorporated into yet-to-be reintroduced SCHIP legislation.
General consensus among industry lobbyists and consultants holds that despite campaign rhetoric, the reality of governing, particularly in the economic circumstances faced by all segments of the economy, will prove difficult for the new Administration's legislative priorities to be quickly approved.
With those caveats in mind, there were three consensus views that emerged:
While there are credible scenarios that would delay SCHIP, there was much agreement that SCHIP will likely be an early priority of the new administration.
House leadership has signaled it will likely be among the top three priorities of the Congress/Administration. SCHIP has passed the Congress twice in 2007, so passing the "old" bill with the "compromise" language would be an easy step.
The make-up of the new House and Senate is even more favorable than before and the new President will eagerly sign the bill. Under this scenario, SCHIP would provide a high profile legislative victory and a down payment on the health care agenda.
The International Premium Cigar & Pipe Retailers Association (IPCPR) is a not-for-profit trade association organized as the advocate for the independent retail tobacconist and recognized as the "Voice of Authority and Reason" on premium tobacco related issues.
From a ICPCPR Press release
Wednesday, January 23, 2008
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From a press release:
January 23, 2008- The U.S. House of Representatives again failed leadership again failed to win over enough Republicans to override President Bush's veto of a children's health insurance bill Wednesday.
International Premium Cigar & Pipe Retailers Association (IPCPR)
Chris McCalla
Legislative Director
From a press release:
Veto Override Expected to Fail
January 23, 2008 - The U.S. House of Representatives will vote today in an attempt to override President Bush's third veto of the now controversial State Children's Health Insurance Program (SCHIP). The president has previously vetoed two other SCHIP proposals. Popular consensus remains that today's congressional attempt to override the president will again fail, for a third time.
Last month, President Bush did sign into law a bill extending the current SCHIP program until March 31, 2009.
Once the final vote is available, an update will be sent to all IPCPR members. I encourage you to share this news with your customers, family, and friends.
The International Premium Cigar and Pipe Retailers is a not-for-profit trade association organized as the advocate for the independent retail tobacconist and recognized as the "Voice of Authority and Reason" on premium tobacco related issues.
International Premium Cigar & Pipe Retailers Association (IPCPR)
Chris McCalla
Legislative Director
Tuesday, December 18, 2007
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From a press release:
Current SCHIP Program to be Extended to 2009
Veto Override Attempt of Current SCHIP Legislation Unlikely
As you know, the President vetoed the current SCHIP legislation on December 12. The House leadership has scheduled a vote for January 23 to attempt to override that veto. It appears that the House will not be able to muster the 2/3 vote necessary to override the veto.
Late last week there was talk regarding a short term extension of the current SCHIP program through March 31, 2008. However, on December 17, negotiators agreed to extend the current SCHIP program through March 31, 2009 with a small increase in funding necessary for the states to maintain their current enrollment through that date. There will be no increase in tobacco taxes to fund that modest increase.
While it is always possible that Democrats will introduce another SCHIP bill in 2008 to force Republicans to vote on the issue, it now appears likely that the issue will be pushed into 2009.
The International Premium Cigar and Pipe Retailers is a not-for-profit trade association organized as the advocate for the independent retail tobacconist and recognized as the "Voice of Authority and Reason" on premium tobacco related issues.
Thursday, October 25, 2007
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Thanks to all you active cigar and pipe smokers that helped uphold the President's veto of SCHIP. You input has helped however now is not the time to rest on our laurels.
Congressional Democrats are currently working on legislation to reintroduce the SCHIP legislation. This proposed legislation will be nearly identical to the previously failed proposal, HR976. In an attempt to appease moderate Republicans, only minor revisions have been made to the eligibility requirements. The tobacco tax proposals, including the excessive taxation on handmade cigars and pipe tobacco, will remain in the legislation.
While IPCPR's federal lobbyists feel that with no substantial changes to this second SCHIP proposal, the president will again veto the legislation (if and when it passes both the House of Representatives and the Senate), and the veto will withstand a second attempt at an override by the House - not enough moderate Republicans will not be swayed to vote in favor of an override due to such minimal changes.
Progress has been made in demonstrating on Capitol Hill that the current proposal will prove detrimental to our industry and we continue working for a compromise.
So we urge you to please keep the pressure un your representatives to not vote for programs that unfairly target those of us who enjoy partaking in a legal activity.
Thursday, October 18, 2007
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News from the IPCPR:
Legislation Proposed Excessive Tax on Cigars
October 18, 2007- Finally, this critical vote failed to pass the House of Representatives in a floor vote today. The final vote was 273-156, short of the necessary two-thirds majority (of present voting members) needed.
We wanted to take this opportunity to thank all of you for your perseverance, tenacity, vigilance, and persistence in contacting your U.S. congressmen and congresswomen, and your senators through
phone calls, emails, faxes, and personal visits to their district and Capital Hill offices. Without your support and direct action we simply would not have made the noise we did in Congress, gaining the attention of influential members that now understand our niche community-industry cannot absorb a massive tax increase and continue to exist.
This is only the first round in what will most likely be a continuing battle for the next several months. As SCHIP expansion and extension of the current program will be sought by congressional democrats. We have already begun communicating and working with congressional leaders and their states, taking the position that if a tax increase in cigars must exist, that a realistic, manageable increase must be a part of the overall proposal.
A special thank you goes out to the manufacturers within our industry for their efforts throughout the United States and Latin America in mobilizing support against this tax increase. Through their coordinated efforts between the Latin American governments, and their counterparts in the United States, they illustrated and successfully conveyed the ramifications of this tax increase on the Latin American citizens and artisans who rely on the handmade cigar industry for a viable, living income. Key legislators now understand it is more than just a pleasure for consumers, but a way of life for those artisans who produced handmade cigars. Because of the handmade cigar industry, many of these citizens would not have reasonable access to medical and dental care, education, and other social services provided by manufacturers based in these small countries.
Thank you again for your efforts and direct action, for if we are to succeed, we must all hang together, or we will hang separately.
International Premium Cigar & Pipe Retailers Association (IPCPR)
Chris McCalla
Legislative Director
Monday, October 08, 2007
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Looking for bullet points or help to craft a message to your local senator/congressman to UPHOLD the SCHIPs veto.
Going to http://capwiz.com/rtda/issues/alert/?alertid=10386901 and inputting your zip code will not only give you a list of representatives near you, but it will also give you bullet points appropriate to how the legislator had previously voted.
The time to act is now so don't wait. We think you'll find this tool from the IPCPR will assist you in knocking this down. SCHIP supporters are gearing up with a multi-million dollar TV campaign to get the uninformed electorate to pressure legislators who voted against the bill to change their minds and override the veto because "it's for the children".