Health Maryland Line Top News — 08 March 2012
By
Capital News Service

ANNAPOLIS- The Senate Budget and Taxation Committee voted Thursday to increase tax rates on cigars and smokeless tobacco from 15 to 75 percent. However, taxes on premium, hand-rolled cigars will be increased to 20 percent.

The bill, sponsored by Sen. Verna L. Jones-Rodwell, D-Baltimore, is championed as an effort to curb tobacco use among underage high school students. According to the Department of Health and Mental Hygiene’s 2010 Maryland Youth Tobacco Survey, 79 percent of underage high school students who use tobacco use a product other than cigarettes.

The bill is meant to discourage sales for smokeless tobacco and cheaper, flavored, machine-rolled cigars, as opposed to premium, hand-rolled cigars sold in cigar stores.

Rome Zaffaroni, owner of the Annapolis Cigar Company, said a 75 percent tax would have put him out of business.

“It would be kind of like throwing a grenade right into my store,” he said.

In a hearing for the bill Wednesday, Patrick Donoho, president of the Maryland Retailers Association, said the tax increases would drive tobacco consumers to shop outside the state or look to the Internet for cheaper products.

Sen. David R. Brinkley, R-Frederick, said a significant tax increase would be a “financial disaster” due to out-of-state competition.

“Cross-border sales are phenomenal, and we’re losing revenue,” he said at Wednesday’s bill hearing.

Maryland currently has a 15 percent tax on cigars and smokeless tobacco products, which is comparable to Delaware, but lower than Virginia, Pennsylvania and West Virginia. An increase to 75 percent would give Maryland the highest tax rate in the region.

MedChi, the Maryland Cancer Society, the Maryland Nurse’s Association and various health organizations have come out in support of the tax increase, which they hope will dissuade people from smoking.

“This is a historic day for health care,” said Vincent DeMarco, president of the Maryland Citizens’ Health Initiative, a statewide health care consumer coalition.

A House version of the bill is scheduled for a hearing Friday.

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About the Author

Mike Bock, 22, is a graduate student at the University of Maryland covering health and education. He received his bachelor's in Writing, Rhetoric and Technical Communication from James Madison University and has freelanced for Patch.com. He is interested in web production, social media and public affairs.