HB 1319-FN-A – AS INTRODUCED
2006 SESSION
09/10
HOUSE BILL 1319-FN-A
AN ACT decreasing the rate of the tobacco tax.
SPONSORS: Rep. Buhlman, Hills 27; Rep. Mirski, Graf 10; Rep. Bettencourt, Rock 4; Rep. Balboni, Hills 21
This bill decreases the rate of the tobacco tax.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
06-2261
09/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Six
AN ACT decreasing the rate of the tobacco tax.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Tobacco Tax; Rate Decreased. Amend RSA 78:7 to read as follows:
78:7 Tax Imposed. A tax upon the retail consumer is hereby imposed at the rate of [$.80] $.52 for each package containing 20 cigarettes or at a rate proportional to such rate for packages containing more or less than 20 cigarettes, on all cigarettes sold at retail in this state. The payment of the tax shall be evidenced by affixing stamps to the smallest packages containing the cigarettes in which such products usually are sold at retail. The word “package” as used in this section shall not include individual cigarettes. No tax is imposed on any transactions, the taxation of which by this state is prohibited by the Constitution of the United States.
2 Applicability. Section 1 of this act shall apply to all persons licensed under RSA 78:2. Such persons shall inventory all taxable tobacco products in their possession and file a report of such inventory with the department of revenue administration on a form prescribed by the commissioner within 20 days after the effective date of this act. The tax rate effective July 1, 2006 shall apply to such inventory. The inventory form shall be treated as a tax return for the purpose of computing penalties under RSA 21-J.
3 Effective Date. This act shall take effect July 1, 2006.
LBAO
06-2261
11/2/05
HB 1319-FN-A - FISCAL NOTE
AN ACT decreasing the rate of the tobacco tax.
FISCAL IMPACT:
The Department of Revenue Administration indicates this bill will decrease state restricted education trust fund revenue by $47,390,000 in FY 2007 and by $43,485,000 in FY 2008 and each year thereafter. There is no fiscal impact on county and local revenue or state, county and local expenditures.
METHODOLOGY:
The Department states this bill decreases the tobacco tax rate from $.80 to $.52, a decrease of $.28 per pack. The Department determined the fiscal impact of this bill by the same methods used to determine the recent $.28 per pack tax increase. According to the model, a $.28 decrease in the tobacco tax will reduce revenue by $43,485,000 per year. The Department further states that the “floor tax” provisions in this bill will reduce tobacco tax revenue by $3,905,000 in the first year the tax is implemented. This provision will require the State to refund the $.28 tax difference for cigarettes already in stores. This tax change is a reduction to restricted education trust fund revenues, since RSA 78:32 states that any tobacco tax excess of $.37 shall be deposited in that fund.
The Department further states that this tax rate change can be administered within their existing budget.