U.S. Senators Frank Lautenberg (D-NJ), Richard Durbin (D-IL), Tom Harkin (D-IA), and Richard Blumenthal (D-CT) have introduced the Tobacco Tax and Enforcement Reform Act, legislation that would reduce illegal tobacco trafficking, eliminate tax disparities between different tobacco products, and increase the federal excise tax rate on tobacco products.
According to a press release, the bill would help the federal government and states collect billions of dollars in tobacco tax revenues, which currently fund children’s health insurance programs, while also helping to lower youth tobacco consumption and combat illegal tobacco smuggling.
The bill would eliminate tax disparities between tobacco products. Under current law, small cigars, and roll-your-own tobacco products are taxed at the same level as cigarettes; cigars, smokeless tobacco, and pipe tobacco are taxed at a lower rate. In addition, the bill would raise the federal excise tax rate on all tobacco products by 93%, which is consistent with President Obama’s budget proposal to raise tobacco taxes.
To address tobacco smuggling, the bill would require packages of tobacco products to be uniquely marked to aid law enforcement efforts to track and trace tax payments on tobacco products. It would ban the sale, lease, and importation of tobacco product manufacturing equipment to unlicensed persons, prevent the illegal re-entry of tobacco products intended for export by requiring export warehouse proprietors to file reports with the Treasury Department, and increase penalties for violating the law. (NACS: www.nacsonline.com)
