Buy your cigarettes now. Cigarette tax two days away
If you smoke, this post won’t be news because you’ve noticed the price of cigarettes jump in the past two weeks. Tobacco companies are getting ready for the increased federal tobacco tax by raising their own prices. (Can someone explain how tobacco companies raising the price of a pack 80 cents will help consumers “adjust,” as the companies have put it? It just seems a way to eke more profit.)
On Wednesday, the federal tax will go from 39 cents per pack to $1.01. All the extra tax money is supposed to help fund the State Children’s Health Insurance Plan, or SCHIP. I’ve written about the new excise tax and SCHIP before and how it relates to cigars. On Wednesday the tax on individual cigars goes up as well, by 40 cents. It’s steep but not as bad as the original version of the SCHIP law, which called for an outrageous $10 tax per cigar. Now, that will be the tax on a box of cigars rather than an individual cigar. That hasn’t stopped the most popular cigar Web site from selling off inventory in what it’s calling “SCHIP Busters.”
The biggest losers in the new excise tax are the makers of roll-your-own tobacco.
