Free Republic
Browse · Search
Bloggers & Personal
Topics · Post Article

Skip to comments.

Stogie News: SCHIP Cigar Tax Increase to be Unveiled Today
stogieguys.com ^ | 01/13/09 | George E

Posted on 01/14/2009 8:03:20 AM PST by TornadoAlley3

[UPDATE: According to the IPCPR, the tax cap will be 40 cents per large cigar. Please click here for their full press release. The tax portions of the bill can be downloaded here (pdf) and the full bill can be downloaded here (285 page pdf).]

Well, it looks like today we’ll all finally learn just what the new federal tax will be on cigars. No more speculation and rumor. The facts will be laid out in the bill to reauthorize the 11-year-old State Children’s Health Insurance Program (SCHIP), which is slated for a vote in the House of Representatives Wednesday or Thursday.

Federal budget crunchers were working the numbers Monday, trying to see if everything adds up. Apparently, the increased tax revenue—largely from a cigarette tax boost—isn’t now sufficient to expand and fund a five-year plan. So, there’s consideration of shortening the time frame and coming back again in a few years.

As I write this Monday night, the final SCHIP bill hasn’t been released. It’s anticipated this morning, and the first place you’re likely to find it is on the House Rules Committee site or on Thomas.gov. Groups involved with tobacco, such as the IPCPR and the National Association of Tobacco Outlets, will also be on top of it.

For most of you reading this, the heart of the issue is what happens with large cigars, the category that includes premium sticks. One provision that could have devastated small cigar shops, a floor tax on inventory, has been shelved. And the plan to boost the cap on individual cigars—currently about a nickel—appears also to have been scaled back.

When President Bush vetoed the previous SCHIP bill, the cap was $3. There has been intense lobbying to push it down more. A few weeks ago, a number of reports put the cap proposal at $1. Over the weekend, a couple of retail shop owners told me they’d heard the cap would be 40-45 cents. A GOP staffer on the Hill told Patrick S on Monday that he was hearing cap figures between 39 cents and $1.

Jeff Borysiewicz, an executive at the gigantic Corona Cigar Co. and executive vice president of Cigar Rights of America, said Monday night that even if the tax ends up at the lowest of those ranges, he won’t be satisfied.

“I don’t feel good about what’s happened,” he told me. The group was among those arguing for a percentage tax increase equivalent to the 156.4 percent boost for cigarettes. That would have put the cigar cap between 12 and 13 cents.

Borysiewicz said he’s convinced that a tax even in the 40-cent range will have significant negative repercussions on manufacturers, importers, retailers and customers as it ripples through the market.

As you read the figures in the new bill, bear this in mind: What you see today is almost certain to become law. SCHIP enjoys strong support from key GOP and Democratic lawmakers, and what the House approves is what the Senate will vote on. Though there has been a lot of talk about having the legislation ready for a Jan. 20 signing by President Obama on Inauguration Day, I’m told it’s highly unlikely the Senate will vote by then.


TOPICS: Government; Health/Medicine; Society
KEYWORDS: cigar; schip; tax

1 posted on 01/14/2009 8:03:21 AM PST by TornadoAlley3
[ Post Reply | Private Reply | View Replies]

To: TornadoAlley3

TAX, TAX, TAX, TAX, TAX. We are witnessing absolute runaway liberalism. Tax and spend beyond all imagination is a freight train headed our way -—


2 posted on 01/14/2009 8:05:12 AM PST by EagleUSA
[ Post Reply | Private Reply | To 1 | View Replies]

To: TornadoAlley3

This won’t help the City of Boston as Cigar Bars have been marked for death in two years.


3 posted on 01/14/2009 8:06:21 AM PST by massgopguy (I owe everything to George Bailey)
[ Post Reply | Private Reply | To 1 | View Replies]

To: TornadoAlley3

Oh The Humanity!

4 posted on 01/14/2009 8:11:59 AM PST by DogBarkTree (Sometimes you have to let it go in order to get a Grip.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: TornadoAlley3

Before too long, Castro will be dead and the embargo on Cuban cigars may be eased. Right at the time that cigars are outlawed regardless of nation of origin.


5 posted on 01/14/2009 8:20:27 AM PST by weegee (Beware the Green Menace, the socialists warning you of global warming under your bed are hysteric.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: TornadoAlley3

Smoke your money instead of just lighting cigars with it.


6 posted on 01/14/2009 8:20:49 AM PST by weegee (Beware the Green Menace, the socialists warning you of global warming under your bed are hysteric.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: massgopguy

Are we going to have a return to private clubs? Something that old money has always preferred?


7 posted on 01/14/2009 8:21:39 AM PST by weegee (Beware the Green Menace, the socialists warning you of global warming under your bed are hysteric.)
[ Post Reply | Private Reply | To 3 | View Replies]

To: TornadoAlley3

Tax everything which might be remotely dangerous.

Surprised there isn’t a skiing tax, Or a mountain biking tax.

I guess it is only a matter of time.


8 posted on 01/14/2009 8:24:03 AM PST by Red in Blue PA (Guns don't kill people; abortion clinics do.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: TornadoAlley3

JR Cigar is having an awesome “S-CHIP sale” on some good Cigars to lighten their inventory before S-CHIP hits. Some really good buy... Stocking up!

http://www.jrcigars.com/


9 posted on 01/14/2009 8:25:02 AM PST by Craigon
[ Post Reply | Private Reply | To 1 | View Replies]

To: TornadoAlley3
But I thought he promised no tax increase for those of us who weren't making more than $250K/year?

ML/NJ

10 posted on 01/14/2009 8:25:02 AM PST by ml/nj
[ Post Reply | Private Reply | To 1 | View Replies]

To: TornadoAlley3; All

What happened to the “Blue Dogs” Democrats who was “supposed” to be “Conservative”???


11 posted on 01/14/2009 8:37:00 AM PST by KevinDavis (Thomas Jefferson: A little rebellion now and then is a good thing)
[ Post Reply | Private Reply | To 1 | View Replies]

To: KevinDavis
What happened to the “Blue Dogs” Democrats who was “supposed” to be “Conservative”???

They get their cigars for free... from lobbyists.

12 posted on 01/14/2009 8:41:23 AM PST by theDentist (Qwerty ergo typo : I type, therefore I misspelll)
[ Post Reply | Private Reply | To 11 | View Replies]

To: KevinDavis

Conservative Democrats? Much like the Wyoming Jackelope.


13 posted on 01/14/2009 8:43:02 AM PST by PSYCHO-FREEP (WHAT? Where did my tag line go? (ACORN))
[ Post Reply | Private Reply | To 11 | View Replies]

To: TornadoAlley3

Lucky for me I quit a couple of months ago - of a sudden, my favorite cigars (Swisher Sweet Slims, Phillies Cheroots and Muriel Coronellas) all started tasting like crap. Tried to hang on another month or so and finally smoked the last one. A month later cigars started making big jumps - $1.65 to $2.25 overnight, etc.

And now this piece of crap - anything to screw the little guy, under the guise of “it’s for the children”. What happens, as it has with cigarettes, when people do stop smoking and revenue drops? Ah well, there’s always the general treasury and besides, it’s for a good cause anyway.


14 posted on 01/14/2009 9:45:47 AM PST by Oatka ("A society of sheep must in time beget a government of wolves." –Bertrand de Jouvenel)
[ Post Reply | Private Reply | To 1 | View Replies]

To: TornadoAlley3
Government taxes always have strange second and third-order effects. This one is a classic.

Because there is a cap on the tax and a very high incremental tax rate (40%+) it will be less expensive cigars that will hurt the most (on a percentage basis). Those cigars are often smaller or of lower quality than the higher-end smokes.

They are often smoked by folks of lesser means.

In addition cigarette sized cigars will be heavily taxed (more every two years for the next six) until that part of the industry is decimated.

Congress' policy preference is clear--rich folks smoking big expensive high quality stogies are good, poor folks smoking cheap smaller cigars are bad.


15 posted on 01/19/2009 3:19:32 AM PST by cgbg ("The Second Great Depression, popularly known as 'The Obamanation'....")
[ Post Reply | Private Reply | To 1 | View Replies]

To: TornadoAlley3
Cigars

Guns

Talk Radio

The conservative internet

and so it goes..

16 posted on 02/06/2009 8:53:52 AM PST by TC Rider (The United States Constitution - 1791. All Rights Reserved.)
[ Post Reply | Private Reply | To 1 | View Replies]

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
Bloggers & Personal
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson