Cigar taxes could nearly triple in Ohio. Gov. John Kasich has introduced a new budget which would increase taxes on all tobacco products in the buckeye state in order to fund tax cuts elsewhere.
Currently, cigars and other non-cigarette tobacco products are taxed at 17 percent of the wholesale price. Kasich has proposed increasing that to 49 percent. The plan would also see cigarette taxes go from $1.25 to $1.85 per pack. In addition, Kasich would introduced an e-cigarette tax.
The new tax structure would mean a cigar with an MSRP of $8 before local taxes would likely increase over $2.50 in price to just under $12 because of the tax jump.
The tobacco tax increases are part of a total of $2.4 billion in tax increases Kasich has proposed in order to reduce the state’s income tax.
It’s unclear how Kasich’s plan will fare in the Ohio legislature. Democrats have already accused the Republican governor of rewriting tax policies to benefit the rich, while Republicans have raised objections to tax increases on other businesses, specifically taxes on the energy industry.