Today the Senate Finance Committee is considering the “Children’s Health Insurance Program (CHIP) Reauthorization Act of 2007,” which, according to James Thorner of the St. Petersburg Times, includes an interesting funding mechanism – raising the federal tax on cigars (currently 4.8 cents) to $10 per cigar. Yes, you read that correctly. Let’s see what small-time cigar maker Eric Newman thinks of that idea:
Eric Newman punches the numbers on his calculator and gapes at the results one more time.
It’s no mathematical error: The federal government has proposed raising taxes on premium cigars, the kind Newman’s family has been rolling for decades in Ybor City, by as much as 20,000 percent.
As part of an increase in tobacco taxes designed to pay for children’s health insurance, the nickel-per-cigar tax that has ruled the industry could rise to as much as $10 per cigar.
“I’m not sure in the history of man, since our forefathers founded the country in 1776, that there’s ever been a tax increase of 20,000 percent,” said Newman, who runs the Tampa business founded by grandfather Julius Caesar Newman. “They had the Boston Tea Party for less than this.”
I like the way this guy thinks. But he’s not done yet:
In Newman’s view – other companies declined comment and left the talking to [Cigar Association of America President Norm] Sharp – it’s not just unfair but also immoral to overtax a product enjoyed not by addicts but by worthy pleasure seekers. The average aficionado smokes about three cigars a week at about $3 to $5 apiece, according to the cigar association.
“A good wine. A good scotch. A good bourbon. A good cigar. It all enhances the quality of life,” Newman said. “We’re in the relaxation business.”
By the end of the interview, Mr. Newman has demonstrated that he now knows as much as anyone about the functioning of the federal government:
“Things happen strangely in Washington,” Newman said.