Revision: Jan. 8, 2019, 9:07 a.m.
HB 438-FN - AS INTRODUCED
2019 SESSION
19-0710
05/04
HOUSE BILL 438-FN
AN ACT removing the exemption for premium cigars from the tobacco tax.
SPONSORS: Rep. Horrigan, Straf. 6
COMMITTEE: Ways and Means
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ANALYSIS
This bill removes the exemption for premium cigars from 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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
19-0710
05/04
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Nineteen
AN ACT removing the exemption for premium cigars from the tobacco tax.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Definitions; Tobacco Products. Amend RSA 78:1, XIV to read as follows:
XIV. "Tobacco products" means cigarettes, loose tobacco, smokeless tobacco, and cigars[, but shall not include premium cigars].
2 Tax Imposed on Tobacco Products Other Than Cigarettes. Amend RSA 78:7-c to read as follows:
78:7-c Tax Imposed on Tobacco Products Other Than Cigarettes. A tax upon the retail consumer is hereby imposed on tobacco products other than cigarettes at a rate of 65.03 percent of the wholesale sales price. The tax under this section may be rounded to the nearest cent if the commissioner determines that the amount of tax would not thereby be made materially disproportionate. No such tax is imposed on any transactions, the taxation of which by this state is prohibited by the Constitution of the United States. [No such tax shall be imposed on premium cigars.]
3 Definitions; Tobacco Products. Amend RSA 175:1, LXIV-d to read as follows:
LXIV-d. "Tobacco products" means cigarettes, loose tobacco, [and] smokeless tobacco, and cigars.
4 Repeal. RSA 78:1, XXI, relative to the definition of premium cigars, is repealed.
5 Effective Date. This act shall take effect July 1, 2019.
19-0710
12/28/18
HB 438-FN- FISCAL NOTE
AS INTRODUCED
AN ACT removing the exemption for premium cigars from the tobacco tax.
FISCAL IMPACT: [ X ] State [ ] County [ ] Local [ ] None
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| Estimated Increase / (Decrease) | |||
STATE: | FY 2020 | FY 2021 | FY 2022 | FY 2023 |
Appropriation | $0 | $0 | $0 | $0 |
Revenue | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase |
Expenditures | $0 | $0 | $0 | $0 |
Funding Source: | [ X ] General [ X ] Education [ ] Highway [ ] Other | |||
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METHODOLOGY:
This bill imposes a tax on premium cigars at the tobacco products other than cigarettes rate of 65.03 percent of the wholesale sales price. Premium cigars are defined as cigars that are made entirely by hand of all natural tobacco leaf; hand constructed and hand wrapped; weigh more than 3 pounds per 1,000 cigars; and are kept in a humidor. The Department of Revenue Administration does not have complete data on the sale of premium cigars currently excluded from the tobacco tax to determine the increase in general fund and education trust fund revenue. The Department indicates wholesalers who sell tobacco products other than premium cigars are required to file a monthly return that reports both the sale of taxable and non-taxable premium cigars. For FY 2018 these wholesalers reported sales of $796,798 of premium cigars. If a seller only sells premium cigars and no other tobacco products, no report of sales is made to the Department. Based on the reports filed with the Department by wholesalers selling tobacco products other than premium cigars for FY 2018, if premium cigars had been taxed at a rate of 65.03% of the wholesale price, the minimum increase in tobacco tax revenue would be $518,158. The Department states it could absorb the costs to administer this bill within its operating budget.
AGENCIES CONTACTED:
Department of Revenue Administration