Because of SCHIP I Now Dip

by BigT | October 2, 2007 at 11:28 am

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David Savona at Cigar Aficionado gives an update to the ridiculous rise in cigar and cigarette taxes thanks to SCHIP. Maybe thanks to the rise in the taxes kids will stop smoking and turn to dipping. Crossing my fingers!

Higher Cigar Tax Passes in House

Posted: Wednesday, September 26, 2007

By David Savona

The U.S. House of Representatives voted yesterday to approve an additional $35 billion in funding for the State Children's Health Insurance Program (SCHIP). The funding would come from higher taxes on cigarettes and cigars.

The legislation has been vigorously fought by members of the cigar industry, including cigarmakers such as Rocky Patel and Christian Eiroa and prominent retailers such as Jeff Borysiewicz of Corona Cigar Co., as well as the Cigar Association of America and the International Premium Cigar & Pipe Retailers Association.

The original measure called for a substantial increase in the cigar tax, from 20.7 percent of the manufacturer's selling price with a five-cent cap to 53.3 percent with a $10 cap, and also called for a floor tax to be levied on companies with inventories of cigars and tobacco. A compromise was worked out earlier this week eliminating the floor tax from the legislation, but the proposed increase in the federal excise tax was kept largely intact, to 52.988 percent of the manufacturer's selling price, with a cap of $3.

The increase is considerable. A perusal of the 12 corona gordas rated in the June 2007 issue of Cigar Aficionado shows that each now carries a federal excise tax of five cents. Under the bill passed by the House, three of the cigars would fall under the $3 maximum tax, and the least expensive would have a federal excise tax of $1.19.

The Senate is expected to vote on SCHIP later this week.

President Bush has said he would veto the legislation. The House vote was 265 to 159, not large enough to overturn a presidential veto.

"But I don't smoke and smoking is bad and smokers put a strain on the health care system and, and, it's just dirty, no one should do it." Well, that's what some people are thinking and saying anyways. Let's take that visceral reaction apart bit by bit.

First, smoking is not "bad." Yeah, it statistically shortens people's lives. But what about carbon dioxide emissions from cars? What about a multitude of other activities most of us participate in, like drinking (occassionally heavy drinking), that shortens our lives? Smoking brings joy to countless individual's lives becuase it allows them to relax and enjoy themselves.

The health care system will be even more strained when everyone is guaranteed health care regardless of how they live their lives. Unless, as is doubtless the aim of Hillary Clinton and other proponents of universal health care coverage, they build into the system rules and regulations about how you have to live your life if you want to receive any treatment. Smokers don't have to be such a strain as long as they are charged more due to their personal choices or refused service until they meet the insurer's requirements.

And don't fool yourself, the most important part about this fight against discriminating against people who partake in a legal activity is that you're next. Before the government has bled smokers dry they will turn their sites on another form of revenue because the dirty little secret is that taxes excised from smokers offer a lot of funding.

Who will they target next? People who eat the wrong things? Drive the wrong cars? Buy the wrong clothes? Have pets? The answer is that they will become more brazen in their lust for the power that extra money from the people they govern provides and will try to raise taxes on everything they can get away with.

They will tax everything they can think of in the name of "helping the children." BigT

BigT, thanks for posting this. You've given a great example of how an opinion piece can be level-headed and sane and not be an attack on a certain individual or set of people. Like Ryan, I mostly disagree with the points you've made here, but I'm glad you made them.

Fellow opinion writers take note of BigT's work here. Nicely done.

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