S-CHIP Required Reading

[Buena Fortuna]

I found this blog by a trusted and knowledgeable B&M updating the S-CHIP legislation.

http://cigarfox.blogspot.com/2009/01/s-chip-update-required-reading-for-all.html

[Tio Gato]

I'm going to show this to my wife as proof that I better buy several hundred cigars in the next couple of months.:ss

[BarneyBandMan]

In talking with my local B&M owner yesterday, he said the cigar manufacturers are looking at all kinds of ways to keep this tax effect to a minimum. For example, he said he's talked to some reps who were indicating that some manufacturers were looking at breaking down the actual cost of a box of cigars in order to reduce the effective actual cost of the tobacco in the box alone and thus reducing the effect of the pass-along tax.

For example, a box of premiums tubos consists of a few dollars worth of wood for the box, the glass for the tubes, etc.--trying to do what ever they could to identify the exact price/value of the tobacco in the box alone and then pay the tax based on that, not the entire package.

He seemed to think it was a possibility to do that. I don't know, but thought I'd pass it along for :2

[macpappy]

I don't understand his logic in the 70% increase he is predicting.

I don't think/believe the government is going to place a tax increase on most manufacturers since they are not U.S. companies so their cost of business shouldn't go up. The same should be true on US companies, I haven't seen anything to suggest that their cost of business will go up because of SCHIP. The local B&M are going to be the ones hit first because they will have to pay the increase on everything they order. So, if you take a box of 20 cigars that normally has a wholesale price of say $80. Add to that the 40 cents per stick SCHIP tax increase ($8.00) and the wholesale cost goes up from $80 to $88 per box. I would hope that the B&M would do the right thing and only increase the retail price by the amount of the tax increase also. This would take a $5.00 cigar and raise the price to $5.40 per stick.

Now I am not sure how the wholesaler is affective by the tax increase since he is buy directly from the manufacturer. Will the wholesale be required to pay a tax on the price of the cigars from the manufacturer? My foggy understanding was that the tax would be based on what the wholesaler sold the cigars to the retailer for.

I've talked to my local B&M owner and he said that is what he plans to do when forced to. He figures if he increases the price more than he absolutely has to that he will lose business.

[Snake Hips]

Looks like if you roll your own, you may now also have to grow your own...

[hotreds]

Sobering.....

[floydpink]

How will this affect overseas purchases, if at all?

[PaleRider]

I absoluetly "Love" (Dripping with Sarcasm) How the hardest hit from this is the demographic that likely can withstand this increase the least!

People that roll your own, typically speaking, are the lower middle to lower income tax bracket folks that are least equiped financially to afford that type of tax increase.

God I hate what our Government "Of the People, for the People" is doing to the very constituents it claims to "Serve" (Dripping with Sarcasm yet again!)

Our founding fathers unquestionably are rolling over in their graves in dismay to what this land has become!

Morte a Tyrants

[Buena Fortuna]

I absoluetly "Love" (Dripping with Sarcasm) How the hardest hit from this is the demographic that likely can withstand this increase the least!

People that roll your own, typically speaking, are the lower middle to lower income tax bracket folks that are least equiped financially to afford that type of tax increase.

God I hate what our Government "Of the People, for the People" is doing to the very constituents it claims to "Serve" (Dripping with Sarcasm yet again!)

Our founding fathers unquestionably are rolling over in their graves in dismay to what this land has become!

Morte a Tyrants

AMEN!:tu

[Snake Hips]

How will this affect overseas purchases, if at all?
Depends on what you mean...certain overseas purchases aren't affected at all anyway, but often the tax is the replacement of your purchase with an awesome letter from the Treasury Department...

[Totemic]

Ok, how about cigars grown, produced and distributed from some other non-Cuban nation with zero presence in the US?

They shouldn't be subject to these taxes no?

[alley00p]

I talked to my B&M owner a couple days ago; he mentioned for the first time, Fuente/Newman has discontinued the practice of "requiring" B&M's order a lot of sticks that they know they won't be able to move. Now, he can pick and choose for the first time since he's been in business (no more boxes of "curly heads" as part of his order :D)!

The other thing is that the "bulk cigarette tobacco" tax was slated to rise from about @$1.50/lb to $24.00/lb. Even a lot of Democrats are realizing that this would bankrupt the domestic cigarette industry. The number of layoffs in that industry might drawf the crap that has happened in the auto industry! According to a friend, he interviewed an "unnamed source" who said that this is one of the things that is holding S-CHIP up right now.

Who knows what will happen? :confused:







:dance::dance::dance:

[stitch]

I'm an RYO guy, Been rolling my own for 35 years,
This $24. tax is the most insane thing I've seen from our wonderful protectors in DC in some time .... I just bought 20 pounds of my favorite rolling tabac.
God only knows what they have in store for us next.

[Snake Hips]

Ok, how about cigars grown, produced and distributed from some other non-Cuban nation with zero presence in the US?

They shouldn't be subject to these taxes no?
I wouldn't think so, but I'm finding the probability that that they would let that be exempt unlikely. Just as you're supposed to declare out-of-state purchases for your state taxes, I suppose you'll be responsible for declaring out-of-country purchases on your federal/state taxes, like the Canadians. But I was making a joke, because I wasn't familiar with any "overseas purchases" of a non-Cuban nature...

@alley00p
The "bulk cigarette tobacco" tax hike is for roll-your-own. I assume this was a "compromise" with Big Tobacco for the comparative leniency on the tax hike for manufactured cigarettes. People won't stop buying cigarettes for a dollar more per pack; I see people buying Marlboro reds for $4.60 a pack, when the place down the street has Davidoff cigarettes for $1.68 a pack. However, the roll-your-own guys will likely be jived out of their thing with that tax increase; one of the perks of RYO was its thrift...$40 for a $15 bag of tobacco, might as well just go get a carton of Pall Mall Unfiltered and be done with it...

[BengalMan]

I'm an RYO guy, Been rolling my own for 35 years,
This $24. tax is the most insane thing I've seen from our wonderful protectors in DC in some time .... I just bought 20 pounds of my favorite rolling tabac.
God only knows what they have in store for us next.

If you notice, the CigarFox article was from 17 days ago. From what I've heard, a revised version of the bill was put together on Tuesday that lowers the $24 tax on RYO substantially. I could be wrong, but it's just what I overheard today.

As far as the tax on cigars goes, let me break it down in the sake of whole numbers.

-You have a box (let's call it Box A) of 25 cigars that has a wholesale cost of $100.
-Manufacturer X now has to pay an additional 35 cents per cigar (right now, they pay 5 cents per cigar).
-Box A, used to cost $100 on the wholesale level. With the new tax Box A now costs $108.75 on the wholesale level.
-Shop B buys Box A for $108.75. Shop B's state (let's say it's Michigan for example) has to pay the state of Michigan 32% of the wholesale cost. Shop B, before the tax was paying the state $32. Now Shop B is paying Michigan $34.80 per box.
-Now is where things get tricky and it comes down to Shop B's personal business practices and this is what will make the biggest difference. The below are just two basic keystone structures.
- First, let me give you an example of a basic keystone formula that is commonly used by many manufacturers to get MSRP. The wholesale cost of the Box A is now $108.75 with SCHIP. On a full keystone cigar, that would mean MSRP of that stick would be $8.70 ($108.75 * 2 / 25). Now, obviously, MSRP is before state taxes.
-Method 1 - Box A is $108.75. Keystone of that cigar is $8.70. HOWEVER, Shop B must pay $34.80 to the state of Michigan. Method 1 is a shop takes $34.80 / 25 and gets $1.40 per stick added to the $8.70 stick, making the final price, before sales tax (if there is any) $10.10
-Method 2 - Box A is $108.75. Tax is $34.80. Shop B adds the two together getting a total of $143.55, THEN keystone's the cigar, now making the final price, before sales tax (if there is any) $11.48

These are just two basic examples of the end result of SCHIP. Now lets compare Method 1 and Method 2 pre SCHIP.

Pre SCHIP
Method 1 - Box A is $100 wholesale. Keystone is $8 per stick at the consumer level. After state tax is paid, cigar ends up being $9.28 before sales tax.
Method 2 - Box A is $100 wholesale. Keystone is $8 per stick at the consumer level. Adding tax, then doing keystone on said cigar would make it $10.56.

So, in the end, using methods 1 and 2 your difference per stick post SCHIP would be:
Method 1 would give you an 82 cent increase per stick, or $20.50 per box.
Method 2 would give you a 92 cent increase per stick, or $23 per box.

Please keep in mind, these are just examples and like I said, every shop prices their cigars differently, this was just laid out to give everyone an idea of what were looking at. To be honest, under a buck a stick increase on the HIGH end isn't going to really change my buying habits much. I've spoken with many many cigar smokers and like you and I they're not happy about it, nor should they be. However, almost all of them said the same thing, their going to continue smoking what they like. Weather your $30 cigar now costs you $30.82 or your $5 cigar now costs you $5.82, smoke what you like when you like. :ss

With that being said, I'm going to bed. I haven't done that much math since college and my brain is tired. If my math is wrong I apologize, I tried my best, lol.

[BarneyBandMan]

I talked to my B&M owner a couple days ago; he mentioned for the first time, Fuente/Newman has discontinued the practice of "requiring" B&M's order a lot of sticks that they know they won't be able to move. Now, he can pick and choose for the first time since he's been in business (no more boxes of "curly heads" as part of his order :D)!


Yeah, my B&M guy told me the same thing. He said all he had to do was pick up the phone now and order whatever boxes he needed. So I asked him to pick up the phone and order a couple boxes of 858 Sungrowns. He chuckled and picked up the phone. They chuckled and hung up.:r

[Totemic]

But I was making a joke, because I wasn't familiar with any "overseas purchases" of a non-Cuban nature...
Actually, I wasn't joking.

For example, tabacordillera.com is a cigar company that I believe is located in Costa Rica producing among other blends, Cumbres de Puriscal blend.

If I order from them, I'm curious as to how the taxes apply. Right now, if I order from them, I don't think I have to pay any federal excise tax (unless the prices include the excise tax already--which doesn't make sense for a Costa Rican outfit to be paying US federal taxes), not even the $0.05/cigar tax that's currently on the books.

Because if it is the case that non-US cigar producers/distributors aren't required to pay this stupid tax, I would imagine a sudden out sourcing of cigar distribution from the US to various parts of the world like Nicaragua, Honduras, Costa Rica, etc... Of course, it would hurt the major retailers like Famous and CI not to mention absolutely killing off what remains of the B&Ms.

[Buena Fortuna]

This is an update from my local B&M


A Cigar Tax Update
Following a long, drawn-out political fight started in 2007, President Obama signed into law the State Children's Health Insurance Program (SCHIP) renewal and expansion.
The new federal excise tax rates to take affect April 1, 2009 are as follows:
Cigarettes $1.0066/pack
Large cigars 52.75% (capped at 40.26 cents per cigar)
Snuff $1.51/lb.
Chew $.5033 cents/lb.
Pipe tobacco $2.8311/lb.
RYO $24.78/lb.
Little cigars $50.00/1,000
Note - While the new law says that the increase is capped at .4026 cents per cigar....Don't fool yourself! State OTP Taxes are added onto this increase! As an example, in Michigan the actual increase is .5314 cents per cigar. On top of the actual increase, manufacturers, wholesalers, and yes retailers will have to take an increase to maintain their gross margins. My guess is that the cigars will go up an average of .75 cents each and by $15 per box by the time it is all done!
While the tax goes into effect April 1, as I predicted the manufacturers responded by immediately raising prices on all Machine Made Cigars and many of the Premium Cigars. The increase was between 8% & 15% and was effective February 4th to the 9th. So our costs are ALREADY UP WHEN WE ORDER FROM OUR SUPPLIERS!
I fully expect an additional price increase before March 15th, of about the same amount. These increases along with the increase taken last September by the manufacturers will allow them to not increase their prices beginning April 1st or if they do, by a very small amount!
It is our intent to continue to give our customers an opportunity to purchase product before we raise our prices over the next few weeks.

ANNOUNCING....THE LAST CHANCE SALE!
On Saturday February 7th will we launch our week long PRE - SCHIP TAX promotion. In addition to continuing to sell all of our cigars at the old prices, we will be offering SPECIAL PROMOTIONS to help you afford to stock up before we raise prices beginning February 15th.
This is an unprecedented event that puts the entire burden of funding Health Care for Children on the backs of those that use Tobacco! While it provides funding for 100% of the low income Children, it is funded by less than 25% of the population that uses tobacco. THIS IS UNFAIR...BUT IT IS DONE!
I would like to thank everyone that did their part contacting elected officials over the past 3 years as we fought this battle. Today it is the smokers that are taking it on the chin....tomorrow it will be the Beer Drinkers, French Fry Eaters, Soda Drinkers and more. BE PREPARED...at some time the apathetic American People will say enough is enough!THE GREAT AMERICAN TAX REVOLT IS COMING! Our forefathers did not stand by idly while their government put unbearable taxes on them....THEY THROUGH THE TEA IN THE HARBOR!
We promise to continue to do our part in keeping Cigars as affordable as possible to our customers through The Cigar Factory Outlet! We will continue to enjoy our events and comradery at any price! Thanks for your continued business.
Dan Jenuwine
Troy, MI 48083

[jitzy]

I don't understand his logic in the 70% increase he is predicting.

I don't think/believe the government is going to place a tax increase on most manufacturers since they are not U.S. companies so their cost of business shouldn't go up. The same should be true on US companies, I haven't seen anything to suggest that their cost of business will go up because of SCHIP. The local B&M are going to be the ones hit first because they will have to pay the increase on everything they order. So, if you take a box of 20 cigars that normally has a wholesale price of say $80. Add to that the 40 cents per stick SCHIP tax increase ($8.00) and the wholesale cost goes up from $80 to $88 per box. I would hope that the B&M would do the right thing and only increase the retail price by the amount of the tax increase also. This would take a $5.00 cigar and raise the price to $5.40 per stick.

Now I am not sure how the wholesaler is affective by the tax increase since he is buy directly from the manufacturer. Will the wholesale be required to pay a tax on the price of the cigars from the manufacturer? My foggy understanding was that the tax would be based on what the wholesaler sold the cigars to the retailer for.

I've talked to my local B&M owner and he said that is what he plans to do when forced to. He figures if he increases the price more than he absolutely has to that he will lose business.


I believe the way it works and I could be wrong is this, if a B&M buys a box from the manufacturer for $100 he sells it for double $200. So if the increase hits the cigars before it gets to the B&M and that box now costs him $108 he's gonna sell that for double $216. So sadly one of the only ways to soften the blow on the public is for the B&M to absorb some of the increase and thats really not fair to them. The way I see it B&M's in states like mine (NY) are in a lot of trouble since we already pay 37% tobacco tax here this will kill a lot of these small businesses.

[BengalMan]

Jitzy,

See my breakdown a few posts above. The option that the B&M's have is to not keystone the tax, which some already do. Some B&M's add the state tax to the wholesale cost, and keystone the whole thing, others keystone the wholesale price, then just add the per stick tax onto the msrp.

[Kreth]

The way I see it B&M's in states like mine (NY) are in a lot of trouble since we already pay 37% tobacco tax here this will kill a lot of these small businesses.
Especially with our illustrious governor now making noise about raising the state tobacco tax, AGAIN.

[Pat1075]

It'll be the floor tax that'll put the hurt on a lot of businesses. I.E. since the tax was only X when they bought the product they have to pay Y because that tax didn't exist yet on everything they already own. (seems extortionist to me but what do I know)

[AD720]

It'll be the floor tax that'll put the hurt on a lot of businesses. I.E. since the tax was only X when they bought the product they have to pay Y because that tax didn't exist yet on everything they already own. (seems extortionist to me but what do I know)


I thought the floor tax got pulled from the final bill?


EDIT: We were both right -no floor tax on large cigars but I guess they could still get the floor tax on bulk tobacco and "small" cigars...

-----------------------

New SCHIP Bill—Federal Cigar Tax to Be Capped at 40 Cents [up from 5 cents, that's my pie?] (http://www.cigarasylum.com/vb/posts)
Cigar Aficionado ^ (http://www.cigarasylum.com/^http://www.cigaraficionado.com/Cigar/CA_Features/CA_Feature_Basic_Template/0,2344,2612,00.html)| 2-8-09 | David Savona

Posted on Sunday, February 08, 2009 4:02:05 PM by SJackson (http://www.cigarasylum.com/~sjackson/)

The House Ways and Means Committee introduced the newest incarnation of the State Children's Health Insurance Program (SCHIP) today. The International Premium Cigar & Pipe Retailers Association (IPCPR) reported in an email that the legislation would impose a revised federal excise tax on large cigars—52.4 percent, with a maximum tax cap of 40 cents per cigar.
It was feared throughout the cigar industry that the cap would be much higher. The original version called for a $10 cap, and earlier versions had a cap of $3 per cigar. The tax is currently capped at five cents.
The bill, which seeks to fund an expansion of SCHIP with higher tobacco taxes, is expected to pass given the new Democratic leadership in Washington. Last year, Congress attempted to pass the expansion, but President Bush vetoed the legislation two times, most recently in December.
"Our industry came together to aggressively challenge the disastrous, proposed $3 tax cap," wrote Chris McCalla, legislative director of the IPCPR, in the email. The new legislation also does not have a floor tax on cigars, although certain other tobacco products would be subject to the floor tax.

[BengalMan]

My question is this, how is the floor tax going to be collected? It's not like the state that can walk in at any given time. Tobacco on a federal level is regulated by the ATF, and I'm sure they have better things to do than chase down a couple hundred dollars from a tobacco shop off the side of the highway in the middle of no where. In order to get an accurate collection, every purchase invoice from the distributor to the shop would have to be pulled, then accurate sales up to the day they are being inquired on would have to be pulled. All this seems like too much hassle. Maybe they will try to go on an honor policy? However, I highly doubt that as well. Who knows.

[ScottieM]

Save yourselves the hassle and heartache. Buy Cuban!:ss

[TheRiddick]

My question is this, how is the floor tax going to be collected? It's not like the state that can walk in at any given time. Tobacco on a federal level is regulated by the ATF, and I'm sure they have better things to do than chase down a couple hundred dollars from a tobacco shop off the side of the highway in the middle of no where. In order to get an accurate collection, every purchase invoice from the distributor to the shop would have to be pulled, then accurate sales up to the day they are being inquired on would have to be pulled. All this seems like too much hassle. Maybe they will try to go on an honor policy? However, I highly doubt that as well. Who knows.

May not be as difficult as you think. Every shop collects and then submits sales tax to the state, most on a quarterly basis at least here in CA. If they, say, report floor stock of X and then their subsequent quarterly sales tax submissions greatly exceed that number it won't take long before they are closed for inventory and double checked. I don't think any shop would want to play that game as it will cost them far more in the long run than paying actual floor tax. The last place you want to deal with is state tax board, they are far worse than IRS to deal with and have the authority to stop your business until they check the numbers.

I thought floor tax is not part of the SCHIP deal?

[BengalMan]

May not be as difficult as you think. Every shop collects and then submits sales tax to the state, most on a quarterly basis at least here in CA. If they, say, report floor stock of X and then their subsequent quarterly sales tax submissions greatly exceed that number it won't take long before they are closed for inventory and double checked. I don't think any shop would want to play that game as it will cost them far more in the long run than paying actual floor tax. The last place you want to deal with is state tax board, they are far worse than IRS to deal with and have the authority to stop your business until they check the numbers.

I thought floor tax is not part of the SCHIP deal?

It is for RYO tobacco, which, in my area, a LOT of cigar shops stock it, and they don't stock a small amount of it.

[AD720]

May not be as difficult as you think. Every shop collects and then submits sales tax to the state, most on a quarterly basis at least here in CA. If they, say, report floor stock of X and then their subsequent quarterly sales tax submissions greatly exceed that number it won't take long before they are closed for inventory and double checked. I don't think any shop would want to play that game as it will cost them far more in the long run than paying actual floor tax. The last place you want to deal with is state tax board, they are far worse than IRS to deal with and have the authority to stop your business until they check the numbers.

I thought floor tax is not part of the SCHIP deal?

Same here, see three posts above. "Large" cigars are immune to the floor tax but I'm guessing everything else is not, especially "cigarette replacements" like small cigars and RYO.

[TheRiddick]

I still say that anyone not reporting correct floor tax is playing with fire. That said, and looking at the RYO increase in the SCHIP, that's a LOT of tax to pay and looks to be very painful. I would recommend any shop with stock on hand right now sell it at huge discount if need be so that come April 1st they have nothing to report or as little as is possible.

Don't forget that state tax boards have 2 months now to figure out which shops will owe them come time to report and collect. This is going to be ugly for the large shops we all buy from, Famous, JR, Corona, CI and others, they have plenty of those small cigars (cigarette replacements) in stock.

[mithrilG60]

I don't think/believe the government is going to place a tax increase on most manufacturers since they are not U.S. companies so their cost of business shouldn't go up. The same should be true on US companies, I haven't seen anything to suggest that their cost of business will go up because of SCHIP. The local B&M are going to be the ones hit first because they will have to pay the increase on everything they order. So, if you take a box of 20 cigars that normally has a wholesale price of say $80. Add to that the 40 cents per stick SCHIP tax increase ($8.00) and the wholesale cost goes up from $80 to $88 per box. I would hope that the B&M would do the right thing and only increase the retail price by the amount of the tax increase also. This would take a $5.00 cigar and raise the price to $5.40 per stick.

Now I am not sure how the wholesaler is affective by the tax increase since he is buy directly from the manufacturer. Will the wholesale be required to pay a tax on the price of the cigars from the manufacturer? My foggy understanding was that the tax would be based on what the wholesaler sold the cigars to the retailer for.

My understanding that the tax is applied each time tobacco changes hands. With cigars that will be at least 4 times (as product arrives in the US, as the importer sells to the wholesaler, as the wholesaler sells to the retailer as the retailer sells to the consumer) so the actual tax will be $1.60 per stick and not $0.40. I could be wrong though as, being Canadian, SCHIP makes 0 difference to me one way or the other. Besides SCHIP is still a joke of a tax compared to what we're hit with up here so I'd still count yourselves lucky.

[macpappy]

My understanding that the tax is applied each time tobacco changes hands. With cigars that will be at least 4 times (as product arrives in the US, as the importer sells to the wholesaler, as the wholesaler sells to the retailer as the retailer sells to the consumer) so the actual tax will be $1.60 per stick and not $0.40. I could be wrong though as, being Canadian, SCHIP makes 0 difference to me one way or the other. Besides SCHIP is still a joke of a tax compared to what we're hit with up here so I'd still count yourselves lucky.

The explanation given to my local B&M owner is that it is only going to be applied to the wholesale price paid by the retailer.

You may have higher taxes but don't you have that wonderful socialized health care for everyone?(note the sarcasm, please)

[mithrilG60]

I could very well be wrong, to be honest I've never given SCHIP more than a passing interest as it doesn't affect me one way or the other.

I recognize the sarcasm, but you're right it is wonderful. It's wonderful to not have to go tens, if not hundreds, of thousands of dollars into debt just to save your life just because you were unlucky enough to be in a car accident or develop some rare disease, etc. It's wonderful not to have your doctor recommending procedures more because they line his pocket and less because they are required for your health. It's wonderful not to have to ask permission of some faceless corporate entity if their profit margin this month allows you to have a procedure required to save or improve your quality of life. No universal access to health care is a basic human right in the all of the developed world.... I'm left to wonder why the US joined the developed world yet? ;)

[groogs]

The whole SCHIP thing really depresses me.:(

[ChasDen]

No universal access to health care is a basic human right in the all of the developed world.... I'm left to wonder why the US joined the developed world yet? ;)

:r :r

Heart transplants, liposuction, knee replacements, and elective health care is a human right?

In the US, Federal law gives everyone the right to emergency care, regardless of your ability to pay. The law entitles you to three things: screening, emergency care and appropriate transfers. A hospital must provide "stabilizing care" for a patient with an emergency medical condition. The hospital must screen for the emergency and provide the care without inquiring about your ability to pay. Hospitals cannot transfer patients until their condition has been stabilized. So in an emergency everyone has equal access to care. If its not an emergency, there are plenty of free clinics and reduced cost facilities around. My daughter chooses to not have insurance against her mothers and I advice. A year ago she needed a procedure done that was going to cost well over a grand. She did some checking around, filled out some papers waited a few months (not life threatening) and got it done for 2 payments of $159. All legal, performed by the same facility that said it was over a grand months earlier.

Chas

[macpappy]

I could very well be wrong, to be honest I've never given SCHIP more than a passing interest as it doesn't affect me one way or the other.

I recognize the sarcasm, but you're right it is wonderful. It's wonderful to not have to go tens, if not hundreds, of thousands of dollars into debt just to save your life just because you were unlucky enough to be in a car accident or develop some rare disease, etc. It's wonderful not to have your doctor recommending procedures more because they line his pocket and less because they are required for your health. It's wonderful not to have to ask permission of some faceless corporate entity if their profit margin this month allows you to have a procedure required to save or improve your quality of life. No universal access to health care is a basic human right in the all of the developed world.... I'm left to wonder why the US joined the developed world yet? ;)

I think we'll just agree to disagree on the health care thing. I've talked to other friends from Canada and they think the "universal health care" is a disaster and tell me horror stories about problems they have had. So you haven't had their problems and the system has been good for you. That great.

I also can't really say I've seen the problems you attribute to the United States medical system either because even though I was in a bad car accident that lead to me having back surgery, I didn't have any of those problems. But that is probably because I'm a military retiree and one of the benefits of surviving 21 years of active duty is I have access to health care with very reasonable co-pays. That being said, my daughter-in-law is a doctor (general practice) and she has to fight with insurance companies on behalf of her patients and not because she's "lining her pockets." In fact the hospital she is associated with has just canned a doctor for that type of behavior.

[Sr Mike]

I recognize the sarcasm, but you're right it is wonderful. It's wonderful to not have to go tens, if not hundreds, of thousands of dollars into debt just to save your life just because you were unlucky enough to be in a car accident or develop some rare disease, etc. It's wonderful not to have your doctor recommending procedures more because they line his pocket and less because they are required for your health. It's wonderful not to have to ask permission of some faceless corporate entity if their profit margin this month allows you to have a procedure required to save or improve your quality of life. No universal access to health care is a basic human right in the all of the developed world.... I'm left to wonder why the US joined the developed world yet? ;)

Wow, no sarcasm in your post at all. It is obvious you have no idea what you are talking about.

[Buena Fortuna]

I could very well be wrong, to be honest I've never given SCHIP more than a passing interest as it doesn't affect me one way or the other.

I recognize the sarcasm, but you're right it is wonderful. It's wonderful to not have to go tens, if not hundreds, of thousands of dollars into debt just to save your life just because you were unlucky enough to be in a car accident or develop some rare disease, etc. It's wonderful not to have your doctor recommending procedures more because they line his pocket and less because they are required for your health. It's wonderful not to have to ask permission of some faceless corporate entity if their profit margin this month allows you to have a procedure required to save or improve your quality of life. No universal access to health care is a basic human right in the all of the developed world.... I'm left to wonder why the US joined the developed world yet? ;)

I've worked in health care for over 25 years in Michigan. If Canada's universal health care is so great, why are our hospitals in Detroit and Port Huron filled up to 20% with Canadian patients who either can't access health care they need or can't wait for bureaucratic red tape delays???:confused::confused::confused:

[Sailchaser]

Some good info from everyone here ,bottom line is they are going to increase the price of sticks no matter what, The sad part is that we will contiune to buy and they (goverment) will see that we do and add another tax on in 6 months to pay for some other program they come up with, It sucks but the USA is still one of the best places on earth to live ,
Happy Smoking :ss

[Buena Fortuna]

Some good info from everyone here ,bottom line is they are going to increase the price of sticks no matter what, The sad part is that we will contiune to buy and they (goverment) will see that we do and add another tax on in 6 months to pay for some other program they come up with, It sucks but the USA is still one of the best places on earth to live ,
Happy Smoking :ss

Who's going to use their stimulus funds to off set the S-CHIP increase??? Sounds like a plan to me:rolleyes:

[TheRiddick]

Who's going to use their stimulus funds to off set the S-CHIP increase??? Sounds like a plan to me:rolleyes:

I am sure we'll see a run on cigars and RYO in the next month or so, right up to the March 30th cutoff. The only problem I see is that we'll end up with flat sales for the products after that point, for months to come, and that will lead to either some jobs lost (best case scenario) or closures of some places altogether and many more jobs lost.

I am watching CA budget impasse right now, the latest is that they will create a new tax on ALL alcoholic beverages, at $0.05 per drink. Not much, it seems, but I am not sure yet where that will start, if it starts at the production end, then it will escalate upwards eventually and that nickel becomes much more by the time you down that drink.

And as is, CA passed this "SCHIP like" tax on tobacco about 10 years ago, we will now pay on top of that. I would love to know where the money has gone for the past 10 years, if it hasn't worked in CA as intended, then why does Hussein's team believe it will work for the entire country? Anyone hear from Rob Reiner since he was able to enact this stupidity in CA and can he provide real time numbers for anyone to look at and see if the program actually works?

I'll fire off a few emails to Rush and O'Reilly and see if they want to pick this up.

[ChasDen]

Who's going to use their stimulus funds to off set the S-CHIP increase??? Sounds like a plan to me:rolleyes:

Unless I missed it there are no plans for a stimulus check like last time and I have seen nothing in the news that leads me to believe anything they have been discussing will put cash in my hands anytime soon.

Chas

[Thrak]

Unless I missed it there are no plans for a stimulus check like last time and I have seen nothing in the news that leads me to believe anything they have been discussing will put cash in my hands anytime soon.

Chas

$400 for singles, $800 for families. Cap is a salary of $75,000 a year for singles, $150k for families.

[ChasDen]

$400 for singles, $800 for families. Cap is a salary of $75,000 a year for singles, $150k for families.


Source ???

Everything I have read says no checks were even proposed in this bill.

Chas

[Thrak]

my bad, not a check, but a "tax holiday", whatever that means.

Mr. Obama's "Making Work Pay" tax cut -- a payroll-tax holiday for workers -- was scaled back. The package set the value of the benefit at $400 for individual workers, down from $500 in the proposal he floated on the campaign trail, and at $800 for couples, down from $1,000. The benefit would phase out for workers making $75,000 a year and for couples earning $140,000.

http://online.wsj.com/article/SB123436825805373367.html

[macpappy]

I just visited my local B&M and had a chat with one of the owners. She pulled out a letter she received providing information about the tax. Basically the retailer will pay the tax when they buy cigars starting on April 1. She buys directly from the manufacturer and not through a wholesaler. According the the U.S. manufacturers she has talked to, they will pay the SCHIP and add the 40¢ per cigar to the box price. On a box of 20, that comes to $8.00. That is the only time the tax will be added to the wholesale cost of the cigars. The B&M will then raise its prices to compensate for the $8.00. According to the owner, they are only going to raise their prices by the 40¢ per cigar.

They haven't figured out how this will work with foreign manufacturers. Some seem to think that the B&M will buy from these manufacturers and then have to report the purchase to the government and pay the tax.

At this time, her and her husband plan to buy as much stock as they can afford prior to April 1 and delay any price increases to the customer as long as possible.

On another note, she said that at least one manufacturer is considering reducing the price of the cigars themselves and increasing the same amount for packaging. Her example was that the manufacturer currently sales a box of cigars for $100. To help offset the cost of the tax, the manufacturer will sell the 20 cigars for $80 and charge $20 for packaging. Since the tax only applies to tobacco, this will reduce the amount of money collected on some cigars.

[vudu9]

Jitzy,

See my breakdown a few posts above. The option that the B&M's have is to not keystone the tax, which some already do. Some B&M's add the state tax to the wholesale cost, and keystone the whole thing, others keystone the wholesale price, then just add the per stick tax onto the msrp.

Personally, I won't keystone the tax, I'll just pass it along. BUT, there will have to be an extra .12 cents (30% here in NV.) added on top of the .40 cents making it .52 cents because the state of Nevada will treat the .40 cent SCHIP tax as Cost Of Goods and TAX THE TAX! What country did I wake up in this morning anyways?!

[hotreds]

Save yourselves the hassle and heartache. Buy Cuban!:ss

Apparently that will be next to impossible as customs will really clamp down on packages from certain central European countries!

Bad news all around!