Eric Newman punches the numbers on his calculator and gapes at the results one more time.
It’s no mathematical error: The federal government has proposed raising taxes on premium cigars, the kind Newman’s family has been rolling for decades in Ybor City, by as much as 20,000 percent.
As part of an increase in tobacco taxes designed to pay for children’s health insurance, the nickel-per-cigar tax that has ruled the industry could rise to as much as $10 per cigar.
And why is this? Why, it’s to pay for health insurance “for the children”.
Here’s the source of the controversy: The Democrat controlled Congress has sought an extra $35-billion to $50-billion for the state children’s health insurance program. The program distributes payments to the states to help buy coverage for kids not poor enough for Medicaid.
Cigarettes, which accounted for more than 95 percent of tobacco tax collections last year, are the main focus of the bill. Federal taxes on a pack would jump from 39 cents to $1.
But the legislation has dragged cigars along for the ride. The industry operates under a 4.8 cents-per-cigar tax cap.
Under the proposed bill, taxes on “large cigars,” a category that includes all but the tiny cigars sold in 20 packs like cigarettes, would rise to 53 percent.
A U.S. Senate version of the bill under consideration today in the Finance Committee sets the maximum tax per cigar at $10.
I think Mr. Newman has the right of it:
“Why don’t we just go out of business?” Newman said. “Here, you can run our company, Mr. Government.”
Now if he just had the balls to do exactly that, and other cigar makers closed their doors, too, where exactly would Congress get their money?
Oh yeah. Big Candy. Big Fast Food.
You’re next, if we don’t put a quick stop to our piratical legislatures and bandit Congress. And when I say “quick stop”, I’m thinking “rope’s end”.