Posted on 11/09/2016 10:02:57 AM PST by Drango
For the first time since 1999, California has raised the taxes on cigarettes—and thanks to an interesting provision in the state laws, the state’s taxes on cigars are also going up.
Just before midnight local time, the Associated Press called the decision on Proposition 56, a ballot measure that asked California voters whether to raise the tax on cigarettes from 87 cents to $2.87 per pack.
California voters overwhelmingly said yes.
Taxes on cigars will also be going up substantially. California adjusts taxes on other tobacco products, including cigars, every year. The state’s Board of Equalization determines the rate by dividing the tax rate per cigarette—currently 4.35 cents—by the average wholesale cost per cigarette. This rate changes each year, it currently is 27.3 percent of the wholesale cost and has stayed around 30 percent since 2011.
In 2013, the Board of Equalization estimated that if the cigarette tax was raised to $2 per pack, the tax on other tobacco products, including cigars, would more than double, to 67.41 percent of the wholesale price.
This means a cigar with an MSRP of $9.50 likely retails for around $13.36 in the state currently, it will now retail for around $17.58 once the new taxes go into effect.
Matt Dogali, the senior director of state legislative affairs for the International Premium Cigar & Pipe Retailers Association (IPCPR), told halfwheel that the group is still waiting on a clarification of whether Proposition 56 will be instituted as a floor tax. There’s nothing in the language of the proposition itself, but a floor tax would mean retailers would be subject to paying additional taxes on all products on their shelves by a certain point. These taxes would be instituted so that all products on a retailers shelf had paid the same tax.
The next tax adjustment from the Board of Equalization is expected to go into effect on July 1.
Proposition 56 comes after numerous attempts by state Democrats to raise the cigarette tax through legislation. Bills failed in both the last regular session as well as a special session that resulted in California raising its minimum tobacco purchasing age from 18 to 21.
California’s 87 cents per pack tax on cigarettes was actually the 15th lowest in the country, it now will be the ninth highest in the nation.
Who says Taxation is the enemy of private enterprise. The smuggling business will go through the roof.
Where can I find source for the 30-day wait for ammo?
I live in California. Most of the smokers that I know are dumb ass Democrats. I vote against all tax increases. Smokers and Democrats are both dumb asses who deserve each other.
Another example of liberals taxing the poor more than the rich.
in Proportion to disposable income this tax increase is huge.
Mexican gangs thank the people of California for the new income stream, and for delivering it just in time to replace lost income from marijuana.
It’s a USER tax. Only people who use the product pay the tax. Inherently fair if you ask me.
There will be a LOSS of state income. There will the costs of the to-be-formed STATE BORDER POLICE, needed to prevent the flood of out-of state cigarettes.
Look for a large growth of over the border convenience stops .
Ask NYC how well that worked? People just smuggle them in. And counterfeit the stamps. Creating another black market.
let me see if I still have the link. I think it was LAT’s
I decided I was going to quit after we made it through the election.
I am smoking the last one now.
Cold turkey from here on out.
I voted against the tax though.
I voted against all proposed tax increases because they won’t stop at cigarettes.
They will tax our food soon.
And the moronic voters in our state will probably vote for that too.(only the moronic ones)
I was also about getting their hooks into the vaping market, that must really be cutting into their tax revenue.
Yes it is true, if you don’t smoke it doesn’t affect you, but if you are are one of the large population of smokers, then it is inherently unfair to the poor.
It is a typical liberal social engineering mandate, an example of telling people how to live their lives, what to do, how to think, what to say.
As long as the tax increase is ONLY on massive cigars and cigarettes, I’m okay. I only smoke the normal sized ones.
Don’t say “Shoflifting” call it “Undocumented Purchase”
One of my daughters pointed out that the state raised the legal age from 18 to 21.
Therefore they were missing that revenue, which led to the increase initiative.
I am wondering how President Trump will get his nationwide CCW reciprocity.
Backward states like CA will have to recognize the right of out-of-staters.
Kalifornia, true blue.
And it extends to “fruits and nuts” I’m told.
Many Indian reservations to get tobacco
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