Whole Leaf Tobacco

New Tobacco Tax Bill Introduced in Senate

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GWLee

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Not wanting to get into politics, and hope I don't get into trouble for this, but have been receiving emails about S.411. When I looked into it, found that it is a current bill for consideration by politicians up the road.
But wanted to know if anyone has also seen the bill S.411 Introduced in Senate (02/24/2021) by IL Senator Richard Durbin? Also known as S.411 - MOMMA’s Act
Text - S.411 - 117th Congress (2021-2022): MOMMA’s Act | Congress.gov | Library of Congress

S. 411. A bill to improve Federal efforts with respect to the prevention of maternal mortality, and for other purposes; to the Committee on Finance.

In particular:
SEC. 4. INCREASING EXCISE TAXES ON CIGARETTES AND ESTABLISHING EXCISE TAX EQUITY AMONG ALL TOBACCO PRODUCT TAX RATES.
This bill has been tried before in both the House and Senate, and apparently died each time, but one day it may not. Reading Section 4 of the bill, it doubles most of the taxes on tobacco in various forms. Saw somewhere that it could have an impact of almost 1,600% increase of taxes on some items, not sure about that, but there is a lot of moving parts involved.

I will be writing my Senators asking to kill the bill. Not sure how much luck I'll have with that, especially with these two Senators, but better to voice my position to them than to let them try and read my mind telepathically....

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GWLee

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The good news is that whole leaf tobacco is not defined as a tobacco product.

Bob
Yes, that is true, for right now. But a lot of folks also still buy some pipe/cigarette tobacco, which might be impacted.

However, I would not put it past them to try and expand the scope to include "ALL" tobacco from seed to end products. Have seen mission creep way too often to not be surprised.

Just my thoughts and intent to keep an eye on it and an ear to the ground.

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ChinaVoodoo

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However, I would not put it past them to try and expand the scope to include "ALL" tobacco from seed to end products
This is virtually impossible. Tobacco tax is not applied at point of sale, then forwarded to the government. If whole leaf was to be taxed for us, it would also have to be taxed as a commodity. That would increase the overhead of whole leaf stored in warehouses, (somewhere between farm and manufacturer) by perhaps billions of dollars. Tobacco products would end up being produced out of country, overnight. Jobs would be lost and because of reduced income tax, it would be a lose-lose situation.
 

GWLee

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This is virtually impossible. Tobacco tax is not applied at point of sale, then forwarded to the government. If whole leaf was to be taxed for us, it would also have to be taxed as a commodity. That would increase the overhead of whole leaf stored in warehouses, (somewhere between farm and manufacturer) by perhaps billions of dollars. Tobacco products would end up being produced out of country, overnight. Jobs would be lost and because of reduced income tax, it would be a lose-lose situation.
Maybe, maybe not. Taxes can be/are levied at any fiscal exchange point, depends on how the bill/law language is crafted. Just wanted to see if any others here in the U.S. had seen/heard of this bill in it's current form.

EDITED - To keep from going political, deleted the remainder of my response.

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ChinaVoodoo

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[deluxestogie note: I have deleted the previous post.]

Several times in several threads, I have explained that the actual structure of the tax system seriously limits the capacity to tax domestically produced whole leaf. Maybe not so clearly in this thread. But a number of members seem to think that administrators carry magic wands which can instantly sublimate such structures, and that they will do so because they are inherently out to get us. Such ideas can be inserted without refute because there is no argument against magic. FTT endorses rational discussion, not partisan finger pointing.

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