Brought to light by the Premium Cigar Association (PCA) yesterday, senator Dick Durban (D-IL) has reintroduced a bill that would increase federal excise tax on all tobacco products, most dramatically affecting premium cigars and pipe tobacco.
Durban is joined by eight other Democrats in sponsoring the bill, including Tammy Duckworth, Jeanne Shaheen, Sherrod Brown, Debbie Stabenow, Richard Blumenthal, Amy Klobuchar, Tina Smith, and Chris Van Hollen, as well as Independent Bernie Sanders.
The bill is titled S. 411, the Mothers and Offspring Mortality and Morbidity Awareness (MOMMA) Act; it is aimed at reducing maternal mortality, lumping in tobacco as a means to fund research for the prevention of maternal mortality.
The bill proposes re-classifying all tobacco products as cigarettes, which the PCA estimates would increase premium cigar taxes by 500 to 1,000 percent, and an increase of 1,650 percent on pipe tobacco. This is accomplished by changing the focus from a percentage of import price (currently 52.75 percent of the import price of a cigar, capped at 40.26 cents per cigar) to weight ($49.56 per pound, no less than 10.066 cents per cigar).
(e) TAX PARITY FOR LARGE CIGARS.—
(1) IN GENERAL.—Paragraph (2) of section 3 5701(a) of the Internal Revenue Code of 1986 is amended by striking ‘‘52.75 percent’’ and all that follows through the period and inserting the following: ‘‘$49.56 per pound and a proportionate tax at the like rate on all fractional parts of a pound but not less than 10.066 cents per cigar.’’
The PCA has provided a means to take action against the bill, allowing cigar and pipe enthusiasts to inform their senators their disapproval, which can be found here: Oppose Federal Tax Increase on Premium Cigars & Pipe Tobacco.