A Message From Lew Rothman (Owner of J.R. Cigars)
Everyone and I mean everyone that even smokes a cigar now and then has to be on alert for messages from all B&M smokeshops AND Internet vendors AND Manufacturers in the next few days regarding the proposed new tax on tobaacco products:“The Senate Finance Committee has scheduled a markup on Tuesday, July 17 on legislation dealing with the State Children's Health Insurance Program (SCHIP). The measure is expected to be reported out of committee. Funding would be almost totally via higher taxes on tobacco products. The cigarette tax will increase by $.61 to $1 per pack effective after December 31, 2007. Other tobacco products would be taxed as follows: large cigars -- 53.13% of mfr's or importer's sales price but not more than $10.00 per cigar.”
In addition, there will be a floor stocks tax on tobacco products manufactured in the U.S. or imported into the U.S, which are removed before January 1, 2008 and held on that date for sale. The person holding the product on January 1, 2008 is liable for the tax to be paid on or before April 1, 2008.
YES ! You read that right ! $10.00 PER CIGAR, plus whatever your local state tax is. The people in Washington have absolutely no clue about the cigar business. Their sole focus is on cigarettes and we are about to get dragged along with it.
Not only will this put virtually every manufacturer, wholesaler, and retaailer out of business. It will also devastate the economy of Nicaragua, Honduras, The Dominican Republic and have a significant impact on Puerto Rico, Indonesia, Costa Rica, Panama, Brasil, and Peru. (Whereupon, I’m sure the USA will be called upon to provide additional relief funding !).
You and everyone else who has any thoughts about continuing to smoke cigars or grow, sort, manufacture, distribute or retail cigars need to make a concerted phone, mail, and e-mail bombardment of Congress very shortly. Hopefully, someone more adept at interpreting this new tax law will supply the proper language for this protest.
Be ready and be vocal, and be outraged because this tax is definitely outrageous. It is my firm belief that if passed as it stands right now the entire industry will collapse prior to April 1,2008 (appropriately named April Fools Day for the Fools we have running the government right now) because no one will have the finances to pay the tax on their inventory.
posted by Josh @ 10:04 PM
6 Comments:
Where do they get off! Oh my God!
First time commenter/responder but I have been listening to you guys for a year now, love the show. Anyway, I sent my local senators (Craig and Crapo - on the Finance Committee, Idaho) an email explaining my distaste with this proposed increase, and I got the following reply:
Thank you for contacting me to express your opposition to the "Smith Amendment" to the Fiscal Year (FY) 2008 Budget Resolution. I appreciate hearing your thoughts and welcome the opportunity to respond.
As you may know, on March 21, 2007, Senator Gordon Smith (R-Oregon) introduced an amendment to the FY 2008 Budget Resolution that would provide for the consideration of an increase in the tobacco products user fee rate. This legislation would apply only to the extent that such a rate increase does not result in an increase of more than 61 cents per pack of cigarettes. In turn, all revenue generated by the increase would be dedicated to the reauthorization and expansion of the State Children's Health Insurance Program (SCHIP). This amendment, which I opposed, passed the Senate but was stripped from the budget in a Conference Committee with the House of Representatives.
While the budget resolution prepared by the House and Senate Budget Committees sets out a broad blueprint for the Congress with respect to the total levels of revenues and spending, the Senate Finance and Appropriations Committees prepare the legislation that actually enacts specific tax and spending policies.
As a member of the Senate Finance Committee, I will be a key participant in crafting such legislation. Please rest assured that I will use my seat on that Committee to ensure that the federal government does not legislate in areas that are traditionally and rightfully handled by the states.
Again, thank you for contacting me. Please feel free to contact me in the future on this or other matters of interest to you. For more information about the issues before the U.S. Senate as well as news releases, photos, and other items of interest, please visit my Senate website, http://crapo.senate.gov.
Sincerely,
Mike Crapo
United States Senator
(end quote)
This amendment was apparently penned by Senator Smith from Oregon, his press release is here. So, if I read that all correctly, the Senate OKed it but the House shot it down. President Bush has already said he would veto it if it somehow gets back in front of him.
Hope this sheds some light on it for everyone.
Thanks Kyle...I too have sent my Senators and Representatives a similar letter of distaste towards the "Smith Amendment" but have yet too hear back...I hope too soon...this amendment is a total load of crap...
Well, I sent a fax to each of my senators. I don't think it will do much good. One is a liberal democrat and the other is a democrat wannabe. Oh well, we can only hope for the best.
Keep the faith!!!
Keep the faith!!
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