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Nicaragua, other exporters say U.S. proposal to raise excise taxes will devastate economies
Jump to full article: Chicago Tribune, 2007-08-28
Author: Oscar Avila | Tribune foreign correspondent
Intro: Government officials and industry leaders say thousands of jobs are at risk in Nicaragua, Honduras and the Dominican Republic because of U.S. legislation that would hike taxes on cigars to help fund an expansion of children's health insurance.
A $10 cigar, for example, would go from incurring a few pennies in U.S. excise taxes to $3 under a Senate bill. Price hikes for the cigars of 30 to 40 percent would be devastating, industry officials argue, because many consumers will simply stop buying cigars.
Far-reaching effects
The worry has spread to the small towns of Nicaragua's tobacco country, which exported 56 million cigars to the U.S. last year. Employees quiz their bosses daily on the U.S. proposal and make plans if their jobs disappear.
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