Massive pipe tobacco and cigar tax increases

[Jevverrett]

Im not sure where this ought to be posted anymore, and hope it doesn’t end up in the rubber room. It’s political, but I believe we like minded brethren will come together on this.

Im sure you are all aware of the upcoming $3.5 trillion human infrastructure spending bill being kicked around in Washington. I received an email today from pipes and cigars stating the increase on cigars to be $96 billion, and the increase in pipe tobacco to be 2100%. I’m not sure what that means for cigars, except they’ll be taxed by the pound as opposed to by the the stick. Insofar as pipe tobacco, I believe the current tax is about $4 a pound. Would that mean it would go up to $86 a pound? Not sure. I think that’d be about $6.50 an ounce. Maybe my math is squirrelly, and it probably is.

Anyway… I’ve just finished sending brief, POLITE and sane emails to my appropriate government officials. I expressed my enjoyment of my use and hobby, and concern for my wallets’ fragile hold on sanity. I realize someone thought this was a good idea. But maybe they don’t know just how impactful this would be to our hobby, as well as the industry supporting it. I would suggest you all consider doing the same. Politely.

 

[Brewdude]

We used to have a separate sub-forum for issues with tobacco regulations and such with our former provider, but not here atm. This post can stay in the RT as long as it doesn't devolve into politics.


Cheers,

RR

 

[Jevverrett]

Thanks. I’m sure we can all get along on this one lol.

 

[Ranger107]

I read some different numbers but it's still absurd. Current federal tax on tobacco is $2.83 per pound. The proposal I read online said the increase would be 1600 to 1700%. However, even if that is true about the lower numbers, that is a $48+ tax per pound. Which means in many instances we would pay more in tax than we pay for the tobacco. Totally ridiculous. What other commodity is taxed at a value higher than it's retail cost? Yes, we all need to contact our representatives. Wonder if we could get them to increase our SS by 1600%??

 

[RSteve]

Pipe tobacco current rate= $2.8311 per lb.
Proposed rate is $49.56 per lb.

I seriously doubt that proposed increase will pass, but I would not be surprised if the rate goes from $2.8311 to $5.6622 (double the current rate).

 

[Jevverrett]

I’m not deathly opposed to that. Pipe tobacco is a very niche market, and as such doesn’t produce much tax revenue. I think we probably represent less than 4% of the national market by weight. It doesn’t represent a scourge on health nationally, and won’t raise the kind of money they looking for. At least without an undue burden on consumers. Which is why I think it may be an oversight, kind of throwing things at the wall. If we don’t make our case known to our representatives, we can’t complain when a 1lb bag goes from $40 to $90.

 

[Ranger107]

There is no reasonable explanation why this is included in the so called "reconciliation" package. Has nothing to do with infrastructure, and as noted, will not raise anywhere near the revenue projected, but will seriously affect those in the industry, growers, blenders, retail, etc. Yes, we are a niche market but to place this kind of undue and excessive burden on one segment of population is just plain wrong. JMHO.

 

[ftrplt]

Most taxes make no sense!! Years ago, the senior senator from Louisiana (family name I just can't remember at the moment. Not Long, maybe Bennett) headed up the Senate Ways and Means Committee in charge of taxation. I remember in a WSJ interview him saying that all tax bill recommendations started this way in conversation..."Don't tax you, don't tax me; tax that man behind the tree!" Politicians are always looking for something to tax! At some point, us folk outside of D.C. should remember the Stamp Act and the Tea Tax! You know how well that was received!!!
Two things about most politicians...If they can't spend money, what good are they?? Second, if a politician's lips are moving, they're probably lyin'! Not political, just reality!!! JMHO...FTRPLT

 

[RSteve]

I think it makes more sense to tax something that almost everyone uses and buys. How about 10 cents for every roll of toilet paper and remove all tobacco taxes.
Tax? You can tax my a**!

 

[Lysander]

Now that the $3.5 billion spending spending bill has been cut in half, does anyone know the status of the tobacco tax in the revised new version?

 

[Ranger107]

Now that the $3.5 billion spending spending bill has been cut in half, does anyone know the status of the tobacco tax in the revised new version?

Probably doubled to make up the shortfall.

 

[daveinlax]

This is all about relabeled RYO tobacco. Big Tobacco is pumping millions into lobbying for this tax increase. They want tax parity with traditional cigarettes and IMO they will get it. I’ve been warning my customers at the shop and barely get a shrug. It will end up costing something like $3.00 an ounce extra. Stock up now Mail Order will be next.

 

[Ranger107]

Wrote to both Senators here in AZ. Not that it will do any good, but I pointed out that 1) it has nothing to do with "infrastructure", and 2) what other commodity would accept a 1600% increase without serious backlash? More like a sin tax and won't raise anywhere near the tax dollars they are projecting. Whole thing is total BS. Not being political, just sayin.

 

[Jevverrett]

Just saw this, which is good news. (maybe) Looks like a lot of emails got to those in Washington. They say it’s a win for business, but if Lou look at the numbers, it’s a win for consumers.

https://journalnow.com/business/loc...cle_4d80d828-3c25-11ec-971a-07834336db77.html

 

[Ranger107]

Just saw this, which is good news. (maybe) Looks like a lot of emails got to those in Washington. They say it’s a win for business, but if Lou look at the numbers, it’s a win for consumers.

https://journalnow.com/business/loc...cle_4d80d828-3c25-11ec-971a-07834336db77.html

Promising, but again. BS. I ask again, what does any of this have to do with infrastructure? Just another ruse for the government to spend more of our money.

 

[Searock Fan]

This kind of tax is commonly called a "sin tax", such as the tax on alcoholic beverages. If they want another sin tax I would suggest a tax on bottled water and a deposit on all those plastic bottles filling the garbage dumps and oceans. Leave my pipe tobacco alone!

 

[Jevverrett]

What they call a sin tax, I call a poor tax. Tobacco, alcohol and especially the lottery. These increases mean nothing to the wealthy. They mean a lot the people who smoke and dip tobacco the most. Typically poor.

 

[Searock Fan]

What they call a sin tax, I call a poor tax. Tobacco, alcohol and especially the lottery. These increases mean nothing to the wealthy. They mean a lot the people who smoke and dip tobacco the most. Typically poor.

" Typically poor." Oh, you mean like those guys who smoke Dunhills and Castellos?

 

[RSteve]

" Typically poor." Oh, you mean like those guys who smoke Dunhills and Castellos?

I think most tobacco use in the U.S. is via cigarettes and cigarette smokers are likely spending a disproportionate amount of their income on their cigarette habit.

 

[Jevverrett]

Most people who smoke, use cigarettes. And by “dip”, I mean moist snuff. Tobacco taxes are one of the only regressive tax structures in our country. The only other I can think of being alcohol. Meaning, the less money you make, the larger the percentage of your annual income is taken up by these taxes. The chief aim in going after the broader ”other” tobacco category (moist snuff, pipe tobacco) is the sharp increase in roll your own tobacco being marketed as pipe tobacco to avoid taxation. I don’t think many rich people are making their own gambler menthols at home to save money. Just my opinion