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It passed the committee 17-4

Part of my response to Dodd and Lieberman was that tobacco agriculture is still meaningful here, and that this bill would be damaging to businesses and farmers in the state.

Sure it didn't do much good though.
 
tigger said:
Part of my response to Dodd and Lieberman was that tobacco agriculture is still meaningful here, and that this bill would be damaging to businesses and farmers in the state.

Sure it didn't do much good though.
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Yes...I did bring that up.


Hey - how about a tax on gym memberships?
 
I believe we need to get our senators to address the cigar portion of this bill. The United States is no longer the leader in the purchase of cigarettes. Japan, China, India, the former Soviet Union and other "developing" markets purchase of cigarettes far exceed that of the United States. So, I think, a lot of the senators are viewing this as a "safe" tax, as the brunt of it will be borne by cigarette sales outside of the country.

They all need to be aware of the implications it has, as currently written, on cigar smokers and vendors here in the USA. As we are the largest, by far, consumer group of NC cigars worldwide.
 
tigger said:
Part of my response to Dodd and Lieberman was that tobacco agriculture is still meaningful here, and that this bill would be damaging to businesses and farmers in the state.

Sure it didn't do much good though.
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Take a drive through rural, NC, SC, or GA if you want to see an impact on agriculture. Although, I will grant you 95% of the tobacco grown in the South East is mainly for the cigarette market, it's amazing how many farmers in this area are dependent on their tobacco crop.
 
Jack Straw said:
I believe we need to get our senators to address the cigar portion of this bill. The United States is no longer the leader in the purchase of cigarettes. Japan, China, India, the former Soviet Union and other "developing" markets purchase of cigarettes far exceed that of the United States. So, I think, a lot of the senators are viewing this as a "safe" tax, as the brunt of it will be borne by cigarette sales outside of the country.

They all need to be aware of the implications it has, as currently written, on cigar smokers and vendors here in the USA. As we are the largest, by far, consumer group of NC cigars worldwide.
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I'm pretty sure this is a tax on retail sales, within the US, not on sales by US tobacco firms outside the country.
 
mmburtch said:
Jack Straw said:
I believe we need to get our senators to address the cigar portion of this bill. The United States is no longer the leader in the purchase of cigarettes. Japan, China, India, the former Soviet Union and other "developing" markets purchase of cigarettes far exceed that of the United States. So, I think, a lot of the senators are viewing this as a "safe" tax, as the brunt of it will be borne by cigarette sales outside of the country.

They all need to be aware of the implications it has, as currently written, on cigar smokers and vendors here in the USA. As we are the largest, by far, consumer group of NC cigars worldwide.
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I'm pretty sure this is a tax on retail sales, within the US, not on sales by US tobacco firms outside the country.
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Sorry to disagree but the tax will be placed on the wholesalers.

Here is a quote from Cuesta-Rey on the subject:

Cigarettes, which accounted for more than 95 percent of tobacco tax collections last year, are the main focus of the bill. Federal taxes on a pack would jump from 39 cents to $1.

But the legislation has dragged cigars along for the ride. The industry operates under a 4.8 cents-per-cigar tax cap.

Under the proposed bill, taxes on "large cigars," a category that includes all but the tiny cigars sold in 20 packs like cigarettes, would rise to 53 percent.

A U.S. Senate version of the bill under consideration today in the Finance Committee sets the maximum tax per cigar at $10.

In other words a $10.00 retail smoke that currently wholesales for $5.00 would have the wholesale price jump to about $7.65, so for the retailer to maintain his current margin the retail price would jump to a minimum of $12.65, based on a "keystone" markup, which, admittedly most online retailers and many local B&M's do not get.

Anyway you cut it, a 53% tax increase is huge. It will raise the everyday smoke to the level of a premium, a premium to a super premium, etc.

It's easy for legislators to pass "sin taxes" that focus on "children's health" issues by tying it to the cigarette industry, as most people in this country, as well as a number of folks on this and other cigar boards, are opposed to cigarette smoking. It seems that the cigar industry has been caught up in the fever to fund this program. I think we need to let our legislators know that cigar smokers vote, and the way that legislator votes on this issue will reflect how we, as a community, will vote come election day.

And FYI, the State Children's Health Insurance Program (SCHIP) is a very bipartisan issue, as both Democrats as well as Republicans endorse it.
 
The Wall Street Journal 'gets it'.

The Wall Street Journal said:
Emptying the Humidor
Congressmen push a cigar tax, proving they've learned nothing from history.



The Wall Street Journal
BY DAVID HOGBERG
Wednesday, July 25, 2007 12:01 a.m.

I've often wondered exactly how severe is Congress's case of historical amnesia. In late 2005 we found out that many members of Congress clearly couldn't remember anything previous to 1980, as witnessed by their call for 1970s-type price controls on oil. But last week we learned that Congress's historical amnesia is much worse than anyone feared. Clearly it extends back to as recently as the early 1990s.
Nineteen-ninety was the dreadful year in which President George H.W. Bush abandoned his "Read my lips, no new taxes" pledge to cut a deal with congressional Democrats to increase taxes. Among the new taxes created by that deal was an excise tax on "luxury items." This "luxury tax" was imposed on goods such as jewelry, furs and yachts. It was subsequently repealed in 1993 after proving to be nothing short of an economic and policy disaster.

Last week members of the Senate Finance Committee including chairman Max Baucus (D., Mont.), Jay Rockefeller (D., W.Va.), Chuck Grassley (R., Iowa), and Orrin Hatch (R., Utah) cut a deal to increase the funding for the State Children's Health Insurance Program to the tune of $35 billion over five years. To generate this money, the deal imposes a new luxury tax on cigars.
To understand why the luxury tax on cigars is a terrible idea, we need to revisit the history of the luxury tax of the early 1990s--a history that congressional members' severe amnesia is preventing them from remembering. Class-warfare thinking infected the luxury tax of 1990. Think of the multimillionaire whose wife was wearing a gold-and-diamond necklace and a fur coat. They were getting into their limousine to drive to their 100-foot yacht on which they would spend their weekend. How was it possibly fair that the rich spend so lavishly on such unnecessary items when Joe Six-Pack struggled just to put food on the table? Imposing a luxury tax on those items was a proper way to even things out, to make the rich pay their "fair share" to fund the government programs that helped Joe Six-Pack.
Unfortunately, Congress never bothered to consider that increasing the tax on these items, and thereby increasing the price of those items, might change the behavior of said rich people. (Indeed, many members of Congress stubbornly refuse ever to acknowledge that taxes ever affect behavior.) But said rich people had other ideas. If the price of jewelry, furs and yachts suddenly increased, then maybe purchasing a winter home in Florida seemed like a much better deal. Or maybe those rich people would take a shopping trip to other parts of the world, where the prices of jewelry, furs and yachts were now much more competitive thanks to the U.S. Congress.
And if members of Congress never considered that the luxury tax would discourage rich people from buying luxury items in the U.S., then they surely never considered that such an effect might not be so good for the Joe Six-Packs who worked in the industries producing luxury items. A Joint Economic Committee study later found that 330 jobs in the jewelry industry and 7,600 jobs in the yacht industry were lost thanks to the luxury tax. Perhaps the greatest irony was that in 1991 the federal government paid out over $7 million more in unemployment benefits to those workers than it collected in luxury tax revenues.

Fast forward to 2007. The current tax on cigars is a maximum 4.8 cents a cigar. The new proposed luxury tax on cigars is 53.13%, up to a maximum tax of $10 a cigar. Thus, if you like cigars worth $20, you'd be facing a staggering tax increase of 20,733%. By comparison, the luxury tax of 1990 was an increase of only 10%.
No doubt supporters of this tax will claim that it will have little impact on cigar purchases since cigars contain nicotine, which is addictive. But nicotine has minimal impact if the tobacco smoke isn't inhaled, and in my experience most cigar smokers do not inhale. Thus, many cigar smokers should have little trouble quitting if they find the luxury tax has increased the price of cigars beyond what they want to pay. Others will continue smoking cigars, but will reduce their costs by smoking fewer of them. And, of course, some cigar smokers will avoid the tax by buying cigars abroad, a purchase made all the easier by something that didn't exist in 1990, the Internet. Why, here's a page that lists 52 Web sites for buying cigars in Europe. In short, this new luxury tax will cause a precipitous decline in consumption of American-produced cigars.
Of course, about as many people are going to shed tears for the person buying a $20 cigar as did for the rich person buying a yacht. But they might feel a lot of sympathy for the Joe Six-Packs who work in the cigar industry. Exact numbers about how many people work in the cigar industry today are hard to come by since the federal government stopped collecting data on cigar producers a few years ago. In 1999, the Census Bureau reported that 3,845 people worked in the cigar industry. Norm Sharp, president of the Cigar Association of America, guesstimates that the industry now employs between 7,500 and 10,000 workers, a plausible number given the growth in the industry in recent years. Whatever the number, what is clear is thousands of cigar employees face a fate similar to workers in the yacht and jewelry industries in 1990.
That is what Congress's severe case of historical amnesia yields--an astronomical tax increase leading to workers losing their jobs. But try to look at the bright side. If those cigar workers lose their jobs, the resulting decline in their incomes will mean that their kids will have no trouble qualifying for the State Children's Health Insurance Program.
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Then again, only rich people read the Journal.
 
Great article, and really puts things in perspective in case anyone still had any doubts about how SERIOUS this really is.
 
Theres only one solution, a million man cigar smokers march on DC. They think its hard to see with the smog in LA, just wait till we get settled in and fire em up.
 
Preach it! I’m there!


Just make sure to dress down. We don’t want to give the impression of affluence. :rolleyes:
 
Has anyone come up with a good form letter that we could use that address all the important aspects of this bill. I am not so good at making a written point, but one does need to be made. I know there are those out there on this forum that have the skill to craft a well written letter that could be used to help our cause. I, for one, would be grateful for help along those lines.

Tim
 
How's this for a short and to the point message...

Dear Senator,

I am appalled and outraged at your blatant ignorance and lack of concern for the cigar smokers in your state. As a community we will not stand to be lumped into a flawed cigarette tax bill for healthcare. All responses from your office to this point have resulted in "stock" letters and a general skirting of the issues that the cigar smoking community has raised. I want to thank you for making it clear to me where you stand on this issue, and as a community we will make it clear to you with our votes and campaign contributions when the next term for your seat is available.


HA!
 
MX said:
Has anyone come up with a good form letter that we could use that address all the important aspects of this bill. I am not so good at making a written point, but one does need to be made. I know there are those out there on this forum that have the skill to craft a well written letter that could be used to help our cause. I, for one, would be grateful for help along those lines.

Tim
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FAX FORM AND NUMBERS
 
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