After the exorbitant tax increase on cigars that went into effect on August 1, 2010, and balooned the rate from 46 percent of the wholesale price to 75%, there is hope that new legislation will cap that tax and help revitalize the cigar business in the Empire State.
Assemblywoman Michelle Shimel and Assemblyman Michael DenDekker are sponosoring bill A01093, while state Senators Martin Golden and Tom Libous are sponsoring SB 3410, both of which aim to implement a $1 tax cap on cigars sold in New York.
The increase in taxation came during an emergency session of the New York legislature, and was passed as a way to keep the state government operating during tough financial times. Officials promised revenues of near $500 million per year with the new tax, while opponents countered that cigar smokers would take their business to neighboring states or to the Internet, costing the state the forecasted revenue. Then-New York state governor David Patterson had originally sought taxes of 90% on cigars.
Cigar smokers in New York are encouraged to contact their elected officials in the New York House of Representatives and the New York Senate and show support for these two bills that will help rein in the gross and unfair taxation that New York State has levied.