Bills That Would Expand And Increase The Tobacco Excise Tax Pending In Congress

Author:Troutman Sanders Tobacco Practice
Profession:Troutman Sanders LLP

Little has transpired on two bills that would expand and increase the excise tax on tobacco products. Pending in Congress are S. 1837, introduced by Senator Richard J. Durbin (D-Ill.), and H.R. 729, introduced by Congresswoman Brenda L. Lawrence (D.-Mich.).

Senator Durbin's bill would increase taxes on pipe tobacco, processed tobacco, smokeless tobacco, and certain cigars with the aim of equalizing the tax with cigarettes, small cigars, and roll-your-own tobacco. Annual adjustments for inflation would also be taken into account. In addition, the bill would extend the excise tax to all tobacco products covered under the Federal Food, Drug & Cosmetic Act, such as e-cigarettes, bringing presently-untaxed products into its sweep.

Congresswoman Lawrence's bill would accomplish much of the same; however, it would result in further tax increases. It would also address various matters related to transfers of machines for tobacco production or manufacturing, markings and labeling on packaging, and recordkeeping and reporting, among other things.

The enactment of either bill would have widespread effects in the tobacco industry. Perhaps...

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