The section "Coordination with Taxation of Other Tobacco Products" specifies that cigars, cigarettes, smokeless tobacco, pipe tobacco and roll-your-own tobacco would continue to be taxed as before. House of Representatives Rules Committee.
DETOURS IMPERIAL MO CODE
Proposed "Taxable Nicotine" Changes to Tax Code (Print 117-18) The part that has been reinserted is the introduction of the concept of "taxable nicotine", to be taxed at the same dollar amount as specified per thousand for cigarettes (i.e. cigarettes would continue to have a FET of $50.33 per thousand. The draft bill still leaves out the previous part of the proposal that would double the FET on cigarettes and increase it significantly for other tobacco products.
The latest proposal includes only tax hikes for e-vapor and nicotine pouches. We believe the net effect would be to protect cigarettes at the expense of e-vapor and nicotine pouches. This proposal was removed in an October version (117-17) of the draft bill.Īs of this week, parts of the previous proposal have been reinserted into the latest version (117-18) of the bill. As we explained in our review at the time, the increases would be negative for all manufacturers, but with Altria ( NYSE: MO) emerging a relative winner. Congress has been locked in budget negotiations for months, largely due to the Senate having just a single-seat Democratic majority (from the Vice President's breaking vote the 100 Senators are split 50/50).īack in September, House Democrats proposed large increases in the tobacco Federal Excise Tax ("FET") (under the "Build Back Better Act", or HR 5376). budget proposal released by House Democrats would protect cigarette sales and leave Altria a clear winner. Alfexe/iStock via Getty Images Introduction
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