Montana Tobacco Tax Increase Gets First Hearing Today (Update)

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A bill in Montana to increase the tax on tobacco products will get its first hearing today after having been in the works since early November.

S.B. 354, authored by Sen. Mary Caffero, D-Helena, is seeking an increase in the tax on cigars from 50 percent of the wholesale price to 74 percent. For a premium cigar with an MSRP of $10, the cost at the register would jump from $15 to $17.40 before any sales taxes are added, by halfwheel estimates.

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The bill is also seeking the same increase for other tobacco products besides cigarettes and moist snuff; cigarettes would see an increase in the tax from $1.70 to $3.20 for a pack of 20, while moist snuff would be subject to an increase from 85 cents per 1.2 ounces to a number that would be the greater of 74% of the wholesale price or the tax on each pack of 20 cigarettes per 1.2 ounces of moist snuff.

It would also redefine the term tobacco products to include electronic devices such as e-cigarettes and vape pens.

Funds raised from the increase would be directed to a number of areas, including state veterans’ nursing homes, the state general fund, and health and medicaid initiatives.

It is scheduled for a hearing by the Senate Committee on Taxation today at 9 am local time. Should the bill end up passing the legislature and be signed into law, the tax increases would go into effect on April 30, 2017.

Update (March 28, 2017) — The bill passed the committee by a 9-3 vote today and will now head to the Senate floor for a full vote. A date for that vote has not yet been announced.

This story was originally published on March 27, 2017.

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Patrick Lagreid
About the author

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.

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