A Minnesota state representative will once again try to score a win for cigar smokers by cutting the state’s cigar taxes by $3 per cigar.
Currently, the state’s tobacco tax sits at 95% of the wholesale price, though it is capped at $3.50 per cigar. State Rep. Jim Nash (R-Waconia) would like to see that cap dropped to $0.50 per cigar. He is hoping to accomplish it by way of HF 123, which he introduced earlier this week and has since been referred to the House Committee on Taxes.
The bill would also drop the phrase “hand-rolled” from the definition of a cigar, leaving it defined as “any cigar that is hand-constructed and hand-rolled, has a wrapper that is made entirely from whole tobacco leaf, has a filler and binder that is made entirely of tobacco, except for adhesives or other materials used to maintain size, texture, or flavor, and has a wholesale price of no less than $2.”
The change would be felt at the register on practically every premium cigar; in the case of a cigar with a suggested retail price of $9.50, the price at the register would go from $16.50 to $10, before local sales taxes were added.
This is the second consecutive session that Nash has introduced such legislation; in the 2015-2016 legislative session, he introduced HF 1544, which sought the same decrease in the cigar tax. Neither that bill nor its Senate companion made it out of its chamber’s committee on taxes.
The bill seeks an effective date of July 1, 2017. A companion bill for the Minnesota State Senate has not yet been introduced.