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SOME TOBACCO companies have pulled another one on the federal government. By relabeling their product, the companies are avoiding a punitive tax placed on rollyour-own tobacco products. . . .
Certainly, tobacco use and abuse can lead to many health problems. Those ailments include lung cancer, respiratory diseases and heart disease. The effects of smoking have taken far too many lives prematurely.
Yet many people in our nation, despite knowing the research, the dangers and the statistics, continue to smoke because they choose to do so.
But that choice should be made based on their own desire and motivation, not based on a tax policy that seeks to make their habit cost-prohibitive.
A free nation should not invoke a punitive tax policy for anything.
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The average rise of only 15 percent in excise taxes the government will slap on tobacco products starting next year takes into consideration only fiscal revenues and the old facts that the cigarette industry is a major employer, a big source of tax receipts and livelihood for hundreds of thousands of farmers.
The tobacco excise tax policy completely ignores the urgent need for tobacco control to minimize health hazards inflicted by smokers on themselves and the people around them.
Little wonder cigarette prices here remain the lowest in Asia. . . .
The government should ally with anti-tobacco NGOs to launch a nationwide antismoking campaign to make people understand the full extent of the grave health hazards caused by smoking and to create a conducive public-opinion environment against smoking.
Tobacco control is not discriminative treatment of a legal industrial product but is all about health protection.
The federal government should have known how small, independent tobacco companies would react when it disproportionately increased the tax on their primary product.
These companies specialize in making tobacco for roll-your-own cigarettes, whose sales had been growing because they are cheaper than packaged cigarettes. But Congress and President Barack Obama this year raised taxes on all tobacco products in order to expand a program that subsidizes children’s health insurance. . . .
The Associated Press reported that the federal treasury could be shorted hundreds of millions of dollars a year if the labeling switcheroo stands. And there is another problem, as worrisome as the loss in taxes. Flavored cigarettes, which attract children, are banned by the Food and Drug Administration. But that ban does not extend to pipe tobacco. This opens the possibility that so-called pipe tobacco could soon be on store shelves in various flavors, an incentive for children to roll their own.
“This is a direct challenge to the federal government,” Matthew Myers, president of the Campaign for Tobacco Free Kids, told the AP.
Certainly the government should address this unforeseen strategy by the independent tobacco companies. Perhaps the tax on roll-your-own tobacco could be reduced somewhat, as it is inordinate. And without question, “pipe tobacco” needs a clear definition.
There are no records kept on how fast loopholes can be uncovered in new federal law, but the roll-your-own tobacco industry is making a breathtaking run for this year's shabby laurels. No sooner had President Obama signed the new children's health insurance law last spring than the industry pried open a lucrative escape from the 20-fold tax increase levied on roll-your-own cigarettes to help support the program. . . .
Obviously the new law is in urgent need of a no- nonsense amendment to bring roll-your-own under proper federal controls and full taxation. The companies plead they merely found a way to save their industry from taxes so prohibitive as to force them to close. That's not a bad idea, given the public health findings about lethal smoking. But the companies' gambit -- the pretense of marketing pipe tobacco -- is an outright deception.
Retailers are winking as they peddle pipe tobacco along with cigarette papers. This is not what President Obama and Congress had in mind in acting to bolster the health of young people. What's the record for shutting a loophole?
Tobacco tax increases are the most effective way to encourage people to stop smoking.
Ukrainian President Victor Yushchenko, citing concern for the tobacco industry, on Nov. 11 vetoed legislation that would have hiked the excise tax on tobacco products once more.
It is worth remembering that - even though tobacco excise taxes were increased in September 2008, and again in February and May of this year - cigarette prices in Ukraine remain among the lowest in Europe. This leads directly to a public health catastrophe for the nation and creates conditions for rampant smuggling of made-in-Ukraine cigarettes to other nations. . . .
However, tobacco companies in Ukraine claimed that this tax increase would have been disastrous for their business. . . .
Transnational tobacco companies came to Ukraine in 1993. They promised employment, investment and revenue. Now they control 99 percent of the tobacco production in Ukraine. In 1992, Ukraine produced 9,000 tons of tobacco leaves. However, despite huge increases in cigarette production, tobacco growing has almost disappeared in the country. In 1996-2008, the foreign trade balance of tobacco leaves and products was negative for Ukraine and totaled more than $2 billion. It actually means that Ukrainian smokers invested $2 billion in the economies of other nations.
What tobacco companies actually produce is death. . . .
Many politicians in Ukraine already understand that high tobacco taxes are good both for public health and public revenues. I hope that the current and future president of Ukraine will understand this as well.
Money flowing into the state from the higher cigarette tax remain on target, with economists Wednesday sticking by earlier forecasts that a dollar per pack boost enacted this spring will pull in $850 million this year.
The cash-flow is strong even as cigarette sales fell with higher prices – particularly in North Florida counties adjacent to states with cheaper smokes.
“I think the legislation is working exactly as we’d hoped,” said Rep. Jim Waldman, D-Coconut Creek, who sponsored the cigarette tax hike last spring. “Not only are we bringing in more revenue, we are reducing consumption.”
Waldman downplayed the impact of cross-border sales. But statistics compiled by the Department of Business and Professional Regulation, which tracks sales, show the biggest declines are in border counties – raising questions about whether people are smoking less, or just traveling out-of-state to get cigarettes.
A new tobacco tax is doing just what its proponents envisioned: reducing cigarette sales while fattening state coffers.
Cigarettes sales are down 27 percent in Florida during the last four months, thanks to a new $1-a-pack tax designed to balance the budget and cut down on smoking.
But despite the drop in sales, tobacco-tax collections in Florida are high and holding steady. That's because state economists accurately factored in the decrease in sales of smokes when they initially forecast the revenue from the surcharge that went into effect July 1.
The new tax, which helps fund Medicaid, will raise $881 million this year and $907 million the next, the economists forecast Thursday when they analyzed cigarette-sales data.
The proposal of Swiss firm SICPA Product Security SA to provide security stamps on cigarettes is not a done deal, Finance Secretary Margarito Teves said yesterday, assuring lawmakers that there was nothing final yet.
"It must be clarified that the SICPA (proposal) is merely an unsolicited proposal under the BOT (Build-Operate-Transfer) Law. It's not a done deal yet," Teves said.
He said that even if the Bureau of Internal Revenue (BIR) is already in negotiations with SICPA for its stamp-tax technology project, it would still be sent back to the National Economic and Development Authority (NEDA) for its board approval and subsequently, be subjected to a "Swiss Challenge."
"Processes must be observed before a decision on SICPA is made," he told reporters yesterday.
A SWISS company is proposing to put in place a system where tax stamps will be affixed on every pack of cigarette and every bottle of liquor to raise more revenues for the government.
The company, SICPA, wants to make it appear affixing stamps on highly taxable goods is a fool-proof way of curbing smuggling and tax evasion by manufacturers. The reality is that it is selling a fraudulent bill of goods.
It’s only about 20 years now that cigarettes and liquor have been free of the green BIR stamp on every pack . . .
SICPA claims its stamps cannot be counterfeited. In this land of fake peso bills, diplomas, passports and even visas, does SICPA really want us to believe its stamps could not be faked? Even a reasonable facsimile would do as in the previous experience with BIR stamps. The BIR stamps, it will be recalled, were also printed in security paper with watermark. A close look at the genuine BIR stamps and the fakes would show which was which. But to repeat, this did not discourage the smugglers.
But the biggest objection to the SICPA proposal is that it will raise prices by an estimated P1.50 a pack, a cost that will be passed on to consumers. Out of that P1.50, about P1 will go to the government and P0.50 to SICPA.
Given that kind of sharing, why does not the government simply increase the specific tax on cigarettes across-the-board by P1 a pack? The government collects the same revenues. The consumer gets a P0.50 break.
The only loser would be SICPA and, presumably, its sponsors who are ramming the proposal down the throat of the BIR.
A proposed state initiative would increase cigarette taxes by 1 dollar a pack to provide more than 500 million dollars a year to prevent and cure cancer. Cigarette tax proposals in California tried before and failed, but the question, will this proposal help or hurt the bottom line...smokers?
Guests: For the Pro-Tax side, Paul Knepprath, an executive with the American Lung Association of California, which underwrote the survey... AND Grant D. Gillham, a Government Affairs Consultant in California for the nation's oldest tobacco company, Lorillard Tobacco Company.
When the state attorney general fabricates an allegation to justify charging a person with criminal activity, everyone in the state ought to take note.
Attorney General Michael Delaney is pursuing a case against Tobacco Haven, a roll-your-own tobacco shop in Brookline. According to the Attorney General's Office, Tobacco Haven owes the state a whole bunch of back taxes on cigarette tobacco. Tobacco Haven says it doesn't because the tobacco in question is for pipes, not cigarettes. Cigarette tobacco is taxed; pipe tobacco is not. . . .
The "for the children" line is deployed every time government goes after tobacco users. From the industry settlements in the 1990s to the massive increases in cigarette taxes in the last few years, states (New Hampshire included) have tried to justify soaking tobacco dealers and users by claiming that their revenue grabs were "for the children."
But it's never for the children. It's always for the revenue. Delaney's attempt to demonize these tobacco shop owners is an abuse of authority. His boss, Gov. John Lynch, should make clear that he won't stand for such abuses in the future.
U.S. Rep. Nathan Deal says he'd sign a bill raising the state cigarette tax $1 a pack if he's elected governor next year.
Campaigning this week in Savannah, Deal said the bill deserves consideration, but added he probably wouldn't push for its passage.
The Gainesville lawmaker's comments are the closest any GOP candidate for governor has come to backing the proposal.
The proposal by state Rep. Ron Stephens, R-Savannah, has been opposed by the GOP majorities in the House and Senate.
But some experts say it may get another look when the legislature reconvenes Jan. 11 and tries to grapple with a worsening budget crisis.
There were more adult smokers in the United States in 2008 than in the year before, the first time in nearly 15 years that the rate of smoking has increased , according to a survey by the Centers for Disease Control and Prevention.
It's a troubling trend for an activity that is the No. 1 most preventable cause of cancer. . . .
Yet, in South Carolina, state lawmakers continue to reject the most effective way to encourage people to quit this harmful and expensive activity: raising the cigarette tax.
South Carolina's cigarette tax stands at 7 cents a pack. Seven cents. That's by far the lowest cigarette tax in the nation, and it has not been raised in more than three decades. . . .
The good news is lawmakers have an opportunity to revive the bill when they convene in January. This is the second of a two-year legislative term, and the Senate can approve the compromise when the session begins.
Whether they do that, or come at the tax increase with a new bill, lawmakers need finally to decide this year to raise this state's abysmally low cigarette tax.
Cigarette sales have fallen sharply across Florida since a $1-a-pack tax increase took effect July 1, plunging nearly 50 percent in some counties.
Statewide, cigarette sales that regularly topped 100 million packs per month dropped to 73 million packs the month the tax became law. Since then, sales have inched back to around 78 million packs but remain well below prior levels.
To supporters, the sagging sales are evidence that the tax is meeting its public health objective: getting smokers to quit. Critics, however, say many people are simply buying their cigarettes elsewhere or switching to items that aren't subject to the higher tax, like small cigars.
The state charge on cigarettes is now $1.34, compared with the 34 cent tax that had been in place since 1990.
"It's working exactly the way it was designed to work. People are quitting," said Rep. Jim Waldman, D- Coconut Creek, a cigarette tax champion. "If I could, I'd raise it another dollar."