Friday, January 29, 2010
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Ok, so hopefully by now you've contacted your local representatives in Congress about stopping HR 4439. If not, you can stand up and be counted using this website.
How else can you help? Get your fellow pipe smokers active in this cause! To make it easier to do so, you'll find attached to this posting a copy of a PDF file that you can print up, cut up and hand out to all you know. This will hopefully make it easy for them to find the Rally Congress site set up to stop this affront to our sensibilities.
Everyone is free to download and use this document to help in this new fight against tyranny!
Friday, January 22, 2010
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HR 4439, the Tobacco Tax Parity Act of 2010 was introduced on January 13, 2010 and would tax pipe tobacco at the same insane rate ($24.78 per pound) as roll-your-own tobacco from the current $2.8311 per pound. Introduced by Representatives Steve Cohen (Dem., TN) and Lloyd Doggett (Dem., TX), it has been referred to the House Ways and Means Committee of which Mr. Doggett, a staunch anti-smoking advocate, is a member.
This bill is not really aimed at pipe smokers as that segment of the population (estimated at .01% of US adults) is so small that the additional revenue generated by PIPE SMOKERS wouldn't cover the cost of pursuing this change. nothing more than an attempt to rope in taxes from roll-your-own cigarette enthusiasts who having been stung by this same price increase in their addiction last spring (thank you SCHIPs) have decided to start rolling pipe tobacco because it is suddenly cheaper real RYO tobacco (if you can call that stuff tobacco really).
Unfortunately, the RYO industry has brought this on to a certain extent because many brands/bags of RYO tobacco have been relabeled as pipe tobacco for taxation purposes. You can tell by looking at the type and the cut of the tobacco that no right-thinking brother of the briar would even consider sticking this trash in their pipe but the manufacturers have proudly changed their RYO packaging to crow that what they are selling is now pipe tobacco and should be taxed at a much lower rate.
Well now, those few of us that truly enjoy a pipe, whether meerschaum, briar or even the old American favorite corncob pipe are going to have to pay through the nose because of RYO smokers trying to inexpensively fuel their addictions AND the greed of corporate RYO tobacco producers.
However, all is not lost.
Contact your local representatives and put pressure on them to stop this bill. If we don't stop this now, it could spell the end of a tradition here in the US: the considered pursuit of the perfect smoke by brothers (and sisters) of the pipe as well as the end of the traditional Tobacconist as we know it.
SPEAK UP NOW AND SPEAK UP LOUDLY!
In case you didn't link through to read the full text of this proposed bill, here is the full text of it as of today:
111TH CONGRESS
2D SESSION H. R. 4439
To amend the Internal Revenue Code of 1986 to impose the same rate
of tax on pipe tobacco as is imposed on roll-your-own tobacco.
IN THE HOUSE OF REPRESENTATIVES
JANUARY 13, 2010
Mr. COHEN (for himself and Mr. DOGGETT) introduced the following bill;
which was referred to the Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to impose
the same rate of tax on pipe tobacco as is imposed
on roll-your-own tobacco.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Tobacco Tax Parity Act of 2010’’.
SEC. 2. PIPE TOBACCO AND ROLL-YOUR-OWN TOBACCO RATE PARITY.
(a) IN GENERAL.—Subsection (f) of section 5701 of the Internal Revenue Code of 1986 is amended by striking ‘‘$2.8311 cents’’ and inserting ‘‘$24.78’’.
(b) EFFECTIVE DATE.—The amendments made by this section shall apply to articles removed (as defined in section 5702(j) of the Internal Revenue Code of 1986) after the date of the enactment of this Act.
Monday, November 09, 2009
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From the city that brought you the smoking ban in parks and other public places under the guise of protecting children from SEEING people smoking comes a new low in their erstwhile condemnation of the LEGAL smoking public.
In late October, the NYC City Council voted to ban sale of ALL flavored tobacco products (except of course menthol cigarettes). This ban would include flavored chewing tobacco and cigars! Mayor Bloomberg, who kicked off the city's crackdown on smoking in 2002, is expected to sign this bill into law soon.
The argument is that the FDA's recent legislation that prohibits the sale of flavored cigarettes (except menthol of course) doesn't go far enough to stop kids from being tempted to smoke. They are claiming that little cigars, cigars, snus and chewing tobacco are all "gateway drugs" that Big Tobacco is using to drive kids to smoke more cigarettes. Of course this is in direct contradiction to the fact that Big Tobacco doesn't produce any flavored smokes BESIDES menthol cigarettes and hasn't for years. Not coincidentally, this legislation purposefully excludes products flavored with "menthol, mint or clove tastes or aromas" from the ban; precisely the only flavored smoking products that Big Tobacco DOES produce.
Brooklyn Councilman Lewis Fidler is the sole voice of reason on this board. His nay vote was cast rightfully because the sale of tobacco products to minors is already illegal and these new laws will do NOTHING to stop that.
Amazingly enough, in this day and age when municipalities are cutting back on critical services like law enforcement, medical and educational services they have chosen a course of action that not only does NOTHING to stop kids from starting to smoke, it does so an estimated cost of $2 million per year in tax revenues that will be lost. How many cops can you add to the beat for $2 million per year?
Why not try increasing the tax on this class of product to price it out of the hands of teenagers? That is the stance that Councilman Fidler espouses as being a more attractive alternative.
More importantly, if you REALLY want to do something about keeping kids from starting smoking via flavored products, why not stop the hypocrisy initiated by the FDA legislation and ban the sale of menthol cigarettes instead of high end luxury products (like fine flavored cigars) enjoyed by consenting adults that are already priced out of the reach of most children?
STOP THE INSANITY NYC! Stop making the useless gestures that make for great sound bites ("It's for the kids") that in reality only go to further stigmatize and criminalize legal consumers of tobacco-based products. Shame on you!
Friday, September 18, 2009
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The Smoking Prevention and Tobacco Control Act, signed into effect by President Barak Obama on June 22 2009 has a provision that prohibits any flavored cigarettes (except for menthol of course) from being sold as of Tuesday. In a “Letter to Industry on Cigarettes Containing Certain Characterizing Flavors”, sent to tobacconists across the country on September 14th, states that
establishes a tobacco product standard special rule for cigarettes that states in part:
…a cigarette or any of its component parts (including the tobacco, filter, or paper) shall not contain, as a constituent (including a smoke constituent) or additive, an artificial or natural flavor (other than tobacco or menthol) or an herb or spice, including strawberry, grape, orange, clove, cinnamon, pineapple, vanilla, coconut, licorice, cocoa, chocolate, cherry, or coffee, that is a characterizing flavor of the tobacco product or tobacco smoke.
This standard applies to all tobacco products that meet the definition of a “cigarette” in section 900(3) of the Act even if they are not labeled as “cigarettes” or are labeled as cigars or as some other product.
Of course, they don’t really explain what the text of Section 900(3) is so many tobacconists have been struggling to try and understand what that means. Does that mean that pipe tobacco and cigars WILL be affected? At face value this could be the case.
Here is the actual text of the appropriate section:
‘‘SEC. 900. DEFINITIONS.
‘‘(3) CIGARETTE.—The term ‘cigarette’—
‘‘(A) means a product that—
‘‘(i) is a tobacco product; and
‘‘(ii) meets the definition of the term ‘cigarette’ in section 3(1) of the Federal Cigarette Labeling and Advertising Act; and
‘‘(B) includes tobacco, in any form, that is functional in the product, which, because of its appearance, the type of tobacco used in the filler, or its packaging and labeling, is likely to be offered to, or purchased by, consumers as a cigarette or as roll-your-own tobacco.
‘‘(4) CIGARETTE TOBACCO.—The term ‘cigarette tobacco’ means any product that consists of loose tobacco that is intended for use by consumers in a cigarette. Unless otherwise stated, the requirements applicable to cigarettes under this chapter shall also apply to cigarette tobacco.
The Section referred to above is most likely Title 15, Chapter 36, Section 1332(1) of the US Code:
(1) The term “cigarette” means—
(A) any roll of tobacco wrapped in paper or in any substance not containing tobacco, and
(B) any roll of tobacco wrapped in any substance containing tobacco which, because of its appearance, the type of tobacco used in the filler, or its packaging and labeling, is likely to be offered to, or purchased by, consumers as a cigarette described in subparagraph (A).
So, using the above, it would appear that cigars will not be affected. It is pretty clear that taking a cigarette and calling it a little cigar is not going to exempt that product from this section of the act. However, truly legitimate little cigars will. However, there is wiggle room provided by the appearance portion of (1)(B) above.
However, where does this leave the pipe smoker? Our vendors tell us this is not going to present a problem, however the verbiage in Section 900(3)(B) could be loosely interpreted to include pipe tobacco because people COULD purchase pipe tobacco for RYO cigarettes. We’ve even seen some vendors bagging up RYO flavored cigarette tobacco and labeling it as pipe tobacco. One look at the tobacco will confirm that it isn’t pipe tobacco despite what it says on the packaging.
Originally I assumed this was an attempt to get around the $24/pound federal tax on RYO products (Thank you SCHIPPs) but it may be an attempt to get around this restriction as well. One hopes that shenanigans like this or extensive use of pipe tobacco by cigarette smokers doesn’t cause a crack-down on pipe tobacco.
Comments or thoughts on this topic? Please use the feedback mechanism shown below…
Wednesday, September 16, 2009
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The Rest of the Story blog has a reasoned post today in “NYC Health Commissioner: "We Don't Think Children Should Have to Watch Someone Smoking” about how anti-smoking movement has degraded from protecting the health of those exposed to second-hand smoke to preventing people from SEEING someone smoking. Smokerism is running amuck in this country and those of us who enjoy our LEGAL past-time need to read this and start to stand up to this type of oppression.
According to an article at NY1, New York City Health Commissioner Dr. Thomas Farley explained that the reason behind the city's proposal to ban smoking in all parks is not to protect people from secondhand smoke, but to prevent children from even having to see a smoker in public.
The Health Commissioner was quoted as stating: "We don't think children should have to watch someone smoking."
The New York Times also reported that the Health Commissioner described the smoking ban in public parks as being intended not to protect nonsmokers, but to get smokers to quit by making it harder for them to light up in public.
According to the article in the Times, "Dr. Farley said the ban—which officials said may require the approval of the City Council, but could possibly be done through administrative rule-making by the city's Department of Parks and Recreation—was part of a broader strategy to further curb smoking rates, which have fallen in recent years."
The Rest of the Story
Make no bones about it. Anti-smoking advocates are now promoting smoking bans for the purpose not of protecting nonsmokers from the hazards of secondhand smoke, but of protecting nonsmokers from even having to see smokers in public. And they readily admit it.
For many of my 24 years in tobacco control, the clearly stated goal of the smoke-free movement was to protect nonsmokers from secondhand smoke by promoting bans on smoking in the workplace and public places. The goal was never to prevent people from seeing smokers. We were talking about a serious health hazard - high levels of direct exposure to a hazardous mix of chemicals in tobacco smoke from other people.
Now, the movement has apparently deteriorated to the point where it is promoting smoking bans simply to prevent people from having to see others smoking.
From an anti-smoking perspective, this is troublesome because I think it will really hurt the cause. It is going to make it more difficult to promote legitimate smoking bans - those which protect workers from substantial exposure to secondhand smoke - in the states which currently do not have workplace or restaurant/bar smoking bans. If we are viewed (now rightly so) as anti-smoking zealots who merely don't want to have to see people smoking in public, then our arguments for intervening in the workplace to eliminate secondhand smoke are greatly undermined.
From a broader public health perspective, this is troublesome because it sets a tremendously bad precedent to ban unhealthy behaviors in public simply because we don't want children to see those behaviors. What's next? Are we going to prohibit people from eating french fries in public because it sets a bad example for kids? Are we going to prohibit the sale of those delicious New York City pretzels because children are seeing the consumption of an unhealthy amount of salt in one sitting? Are we going to prohibit obese people from entering public parks because it sets a bad example?
What the justification being provided for this law does is define smoking as an immoral, rather than simply unhealthy behavior. We generally do not ban unhealthy behaviors in public to protect people from seeing them. The justification for banning certain types of public behavior is either that the behavior harms others or puts them at risk or the behavior violates the public morals. It seems to me that smoking in a wide-open city park does neither. But by justifying banning smoking by arguing that children will see people smoking, city officials are essentially defining smoking as being a violation of the public morals.
I do find it dangerous to set such a precedent, because it is only a small step in logic to use the same reasoning to justify banning obese people from entering public parks. If the justification for not allowing smoking in public is that it sets a bad example for children, then the same reasoning would also support banning obese people from public parks, or also banning a host of other behaviors, from eating Nathan's fries to salted pretzels to high-calorie, colored sugar water (i.e., Coke and Pepsi) in public. I don't understand the singling out of smoking.
What saddens me the most is the loss of the science-base to the tobacco control movement. Not only is the rigor of our science going down the tubes, as I have demonstrated during the past 2 days with these very seriously flawed smoking ban/heart attack studies, but now the science-based justification for our promoted policies is also going down the tubes. Ultimately, I feel this is going to hurt even our legitimate pursuits, such as trying to protect workers from the very real hazards of high levels of secondhand smoke exposure.
What do you think? Speak up and let your voice be heard in our Feedback section below…
Wednesday, September 02, 2009
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Numerous Tobacco Manufacturers and Retailer File Lawsuit on FDA Provisions
A lawsuit was filed this week in federal district court in Bowling Green, Kentucky by R.J. Reynolds Tobacco Company, Conwood Company, LLC, Commonwealth Brands, Inc., Lorillard, Inc., National Tobacco Company, and Discount Tobacco City & Lottery, Inc. against the U.S. Department of Health and Human Services and the U.S. Food and Drug Administration seeking to protect the constitutional right of tobacco manufacturers and retailers to communicate to adults about tobacco products.
Lawsuit Focus: Constitutional Protection of Speech
While the lawsuit does not challenge the authority that Congress granted to the FDA to regulate tobacco products, the forty-six page complaint focuses on declaring as unconstitutional those regulations that prohibit or restrict the advertising of tobacco products and the providing of information about tobacco products to adults. Under the First Amendment of the U.S. Constitution, free speech is protected and the U.S. Supreme Court has defined “speech” to include “commercial speech” which is better known as advertising. In fact, the very first sentence in the complaint quotes the U.S. Supreme Court’s 2001 decision in the case of Lorillard Tobacco Co. v Reilly which states: “[S]o long as the sale and use of tobacco is lawful for adults, the tobacco industry has a protected interest in communicating information about its products and adult customers have an interest in receiving that information.” Specifically, the lawsuit seeks to have declared as unconstitutional the new FDA regulations that would:
- Prohibit color lettering, trademarks, brand logos and images on all retail point-of-sale advertising and direct mail advertising.
- Restrict tobacco product advertising in retail stores to the use of black letters on a white background to list the brand name, product size, price, etc. (also known as “tombstone” advertising).
- Prohibit any color imagery on the packaging of cigarettes and smokeless tobacco products.
- Prohibit tobacco manufacturers from making any statements about tobacco products in scientific, public policy or political debates.
Besides seeking the declaration of unconstitutionality, the plaintiffs in the lawsuit are asking the U.S. Federal District Court in Kentucky for a preliminary and permanent injunction prohibiting the FDA from enforcing the provisions of the law that relate to tobacco advertising, tobacco packaging and graphic labeling requirements.
In response, the FDA may claim that these advertising and packaging restrictions are needed to reduce youth tobacco use. However, more than a decade ago in the U.S. Supreme Court case of Reno v. ACLU, the court majority held that “regardless of the strength of the government’s interest in protecting children, the level of discourse reaching a mailbox simply cannot be limited to that which would be suitable for a sandbox.” In other words, the Supreme Court held that advertising meant for adults and which adults have a right to see cannot be restricted simply because children might also see the advertising.
NATO Retailer Comment
NATO retail member Frank Hinton of Discount Tobacco City and Lottery joined the lawsuit as a plaintiff because, in his words, “we only sell tobacco products to people over the age of 18 and it is not right for the federal government to dictate to me how I advertise legal tobacco products in my stores to adult customers.”
From a NATO press release, 9/2/2009
CNN ran a nice article about the demise of Hav-A-Tampa cigar company that was killed as a result of SCHIPs and moved off-shore to Puerto Rico.
Ironically, children of the worker profiled in this story are now eligible for insurance under the program that put their father out of work in the first place.
You can read the full story here.
And if you know of any jobs to offer to these folks, you can check out the website at havatampaneedsjobs.com.
Friday, July 31, 2009
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Well, so this isn’t strictly a story about taxes but the ongoing rush to condemn our favorite past time (as brothers of the leaf) is just ludicrous! Share this with anyone you know in New York and see if we can’t stop the insanity! What follows is a letter to the NYC City Council from the National Association of Tobacco Outlets (NATO):
July 24, 2009
Proposed Flavored Cigarette Ban Superceded by New FDA Law;
Extrapolations of Studies and State Laws Do Not Support Flavored Tobacco Ban
New York City Council Members
New York City Council
City Hall, Room 5
New York, NY 10007
Dear Council Member:
The National Association of Tobacco Outlets (“NATO”) strongly opposes Proposed Introduction No. 433A that seeks to ban the sale of flavored cigarettes, flavored cigars, flavored chewing tobacco and other flavored tobacco products. While you may already have an opinion about tobacco products, I urge you to read this letter to fully understand how studies and other state statutes have been extrapolated in an illogical manner in a vain attempt to support adoption of this ban on flavored tobacco products.
As a national trade association representing tobacco retailers throughout the country, NATO’s opposition to the proposed regulations is based on the recently enacted federal law banning the sale of flavored cigarettes and the overreaching extrapolations in a Report of the Human Services Division issued on May 21, 2009 by the Committee on Health. As a note of caution, please understand that if the New York City Council proceeds next week to approve Proposed Introduction No. 433-A, the objections cited below will set the stage for a justifiable legal challenge to the flavored tobacco product sales ban.
New FDA Regulations Banning Flavored Cigarettes Supersede New York City Proposal
On June 22, 2009, a bill was signed into law by President Obama authorizing the U.S. Food and Drug Administration to regulate the manufacture, distribution and sale of tobacco products. Specifically, the new law bans the sale of flavored cigarettes nationwide (except menthol cigarettes) as of September 22, 2009 (see Section 907(a)(1) of the Family Smoking Prevention and Tobacco Control Act enacted on June 22, 2009).
That is, the proposed ban on the sale of flavored cigarettes in the City of New York is already moot since the federal law will supercede any city or state regulation. In fact, the federal ban on flavored cigarettes is more stringent than the proposed ban for New York City making the need for a city regulation unnecessary.
Lack of Rational Basis for Flavored Ban on Other Tobacco Products May Compel Litigation
The recent Report of the Human Services Division issued by the Committee on Health purports to support passage of Proposed Introduction 433-A (copies of the applicable pages of the report accompany this letter). However, the report fails to establish a rational basis for prohibiting the sale of flavored cigars and other flavored tobacco products. In fact, the report undermines the truth by inaccurately citing studies and other state statutes to assert an unfounded claim that banning flavored cigars and other flavored tobacco products is necessary to prevent or reduce tobacco use by underage youth.
The report first cites an American Lung Association study from 2006 which claims that “teenagers ages 17 to 19 were more than three times more likely to smoke flavored cigarettes than smokers over the age of 25.” Then, in the next sentence, the report extrapolates the findings of this study to assert that “Thus, flavored tobacco is a serious public health issue because of its appeal to youth.” To claim that a study regarding flavored cigarette smoking rates results in all flavored tobacco being a serious health issue is an illogical and unsubstantiated extrapolation of the study’s findings and cannot support the underlying intent of the proposed regulation.
Next, the report refers to an investigation by Attorneys General from forty states that the marketing of flavored cigarettes may have been contrary to the 1998 Master Settlement Agreement. Again, this investigation dealt with flavored cigarettes and does not lend any credence to the proposed New York City regulation to ban the sale of flavored cigars and other flavored tobacco products.
Regarding state laws, the report notes that Maine restricts the sale of flavored cigarettes and flavored cigars. What the report does not indicate is that the Maine statute allows the state attorney general to approve the continued sale of flavored cigarettes and flavored cigars if the products were on the market prior to January 1, 1985 and the flavors are not “likely to appeal to youth” (Maine Statutes, Chapter 262-A[5]). That is, Maine’s law should not be relied upon as a precedent to adopt a complete ban on flavored tobacco products.
Finally, the report states that “New Jersey bans the sale of certain flavored tobacco products with a characterizing flavor….” Here again, the author of the report confuses the issue by the use of the general phrase “certain flavored tobacco products” when in fact the New Jersey law only bans flavored cigarettes and components of a cigarette. (New Jersey Statutes, Chapter 91, C.2A:170-51.6).
In short, the report issued by the Committee on Health cannot and should not be relied upon from a legal or factual standpoint to support the passage of Proposed Introduction No. 433-A. All of the studies cited in the report are from anti-tobacco organizations or government health agencies that by any definition are not impartial or unbiased. To exacerbate this lack of scientific impartiality, the report takes far too many liberties with the factual basis of these studies and state laws to have any legal credibility. This lack of integrity found within the report will lay the groundwork for possible legal action to enjoin the administration and enforcement of the proposed regulation if it is passed into law.
For the New York City Council to adopt Proposed Introduction No. 433-A based in whole or in part on the extrapolations and inaccuracies in the Committee on Health report is an example of inappropriate public policymaking. While NATO and its members have always supported the goal of preventing underage youth tobacco use, the extraneous nature of the Committee on Health report calls into serious question whether the regulation is even necessary.
With the new FDA tobacco regulations banning flavored cigarettes across the country and the lack of credible empirical support for a ban on all other flavored tobacco products, I urge you to not proceed with a final vote on Proposed Introduction No. 433-A.
Sincerely yours,
Thomas A. Briant
Thomas A. Briant
NATO Executive Director and Legal Counsel
Copy To: Stephen Louis (New York City Council Legal Counsel)
Michael Cardozo (Corporate Counsel)
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.