Maryland made news recently when a law went into effect that banned the direct sales of cigars, along with other non-cigarette tobacco products in the “other tobacco products” (OTP) category, by out-of-state retailers to the state’s residents. The law, which was introduced at the request of the state comptroller, passed in 2010 but took effect on May 1.
Only days later, Pennsylvania-based online and catalog retailers Holt’s and Cigars International reportedly sent emails to their Maryland customers criticizing the bill and asking them to contact the State Comptroller who pushed for its passage. Cigars International called the bill “anti-choice, anti-freedom, and anti-American.”
Cigars International also accused Maryland lawmakers of trying to protect cigar shops from out-of-state competition. Statements from Maryland officials deny such charges, but do say that banning shipments will help them collect OTP taxes.
Still, it’s true that the International Premium Cigar & Pipe Retailers Association (IPCPR) doesn’t oppose such legislation. Chris McCalla, legislative director for the group, says the group is “neutral” on the issue of shipping bans. Apparently, the brick and mortar cigar shops that make up most of the group’s membership were split on the issue in the past.
That some store owners think making out-of-state competition illegal would benefit them is no surprise. But the question isn’t if store owners can gain an advantage from interstate shipping bans, it’s whether such bills are good for cigar smokers and the industry. To get prospective, I asked some people in the industry for their thoughts on the issue.
(more…)