A Michigan state representative has introduced a bill that would permanently extend the state’s 50-cent tax cap on premium cigars, which is currently set to expire in November.

Cigars have been exempted from the full brunt of the state’s tax rate of 32 percent of the wholesale price since November 2012. In terms of costs at the register, a cigar with an MSRP of $9.50 would cost $10.50 by halfwheel estimates, before any additional sales taxes were added. Without the cap, that same cigar would cost $12.54 by halfwheel estimates.

Extending the tax cap permanently, by way of removing a sunset date in the existing law, has been something that has been tried several times in recent years. It reached the desk of former Gov. Rick Snyder in 2018 who vetoed the legislation, after extending the sunset date by five years in 2016. In the 2020 session, a bill proposed to raise the cap to 65 cents and 75 cents in subsequent years, though that failed to advance in the House after being passed by the Senate.

The bill, HB 4485, was introduced by State Rep. Matt Hall, R-Marshall, and has been referred to the House Committee on Tax Policy for discussion.

 

Patrick Lagreid

I strive to capture the essence of a cigar and the people behind them in my work – every cigar you light up is the culmination of the work of countless people and often represents generations of struggle and stories. For me, it’s about so much more than the cigar – it’s about the story behind it, the experience of enjoying the work of artisans and the way that a good cigar can bring people together. In addition to my work with halfwheel, I’m the public address announcer for the Colorado Rockies and Arizona Diamondbacks during spring training, as well as for the Salt River Rafters of the Arizona Fall League, the WNBA's Phoenix Mercury and the Arizona Rattlers of the Indoor Football League. I also work in a number of roles for MLB.com, plus I'm a voice over artist. I previously covered the Phoenix and national cigar scene for Examiner.com, and was an editor for Cigar Snob magazine.