Stogie News: California Taxin’
8 Jun 2010
What may be the strangest cigar news in recent weeks came from California. The state with the most anti-smoking laws in the country and a staggering budget shortfall estimated at more than $26 billion is actually lowering its tax on cigars.
It’s not a huge cut—41.11% to 33.02%, to be exact. And, since its paid by distributors, the reduction may not even be noticeable by the time the retail price is set. But, hey, in this economy anything helps, right? Of course, it’s hard not to wonder why: Why would the state cut cigar smokers and users of tobacco products other than cigarettes a break?
Well, it turns out there was no choice. “The formula demands it,†said Anita Gore, spokeswoman for California’s five-member Board of Equalization tax panel that approved the change without discussion at a May meeting for July 1 implementation.
Gore explained to me that the rather arcane requirements of state tax law are based on the cigarette tax. (For tax purposes, she said, California recognizes only two categories: cigarettes and other tobacco products.)
The state law requires that the tax percentages on other tobacco products match that levied on the wholesale price of a single cigarette. So, with cigarette prices going up and the per-pack tax remaining the same, the percentage drops. And that means the percentage applied to other tobacco products must be lowered as well. Necessary adjustments are made annually.
Gore said that the tax for other tobacco products is levied on the value of whatever amount the distributor buys, whether it’s a truckload or a single stick. Remember, at that point cigar prices are often half or less than retail.
I’m not sure it’s fair that cigar smokers are paying less simply because cigarette smokers are paying more. But that’s the way it is, at least in the Golden State.
photo credit: Stogie Guys

This particular Padilla Series ’68 Robusto had been in my humidor since fall 2007. I didn’t really know what to expect. I’d enjoyed a few of these more or less fresh and was hoping it would be at least as good. What I got was much better.

1) The Church of Scientology paid about $7 million to buy what was once the world’s largest cigar factory, built in 1886 by the man who founded Tampa’s Ybor City. The three-building complex has housed offices since the 1970s. Scientologists propose using the buildings for offices, gatherings, and Sunday service. Although the church says that it plans to honor the building’s historical significance in its plans, the move is not without controversy. “Some business and civic leaders in Ybor City worry about the potential loss of property tax revenues due to the church’s tax-exempt status and the potential denial of alcohol licenses to future businesses opening within 1,000 feet of the church’s property,†writes the
Crafted in Bardstown—the Mecca of bourbon—Jefferson’s Reserve and Sam Houston bourbons are made in “very small batches†from corn, malted barley, and rye. The distiller “marries a mere 8-12 barrels of various ages to produce the best tasting bourbon possible…â€
But, for the bureaucrats at the World Health Organization (WHO), May 31 wasn’t Memorial Day. Rather, it was “
Patrick Ashby
Co-Founder & Editor in Chief
Patrick Semmens
Co-Founder & Publisher
George Edmonson
Tampa Bureau Chief