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New York City Set To Hike Cigar Prices



By this time next year, cigar prices in the The Big Apple are likely to look dramatically higher than they do now.

Today, New York City's Committee on Health passed a series of anti-tobacco bills that will raise the cost of cigars, including value-priced, premium and machine-made smokes, sold within city limits. Additionally the city's new aggressive anti-tobacco legislation addresses cigarette pricing, retailer licensing and bans the sale of tobacco in pharmacies.

For cigar lovers and retail shops, bill number 1544-B is the most important piece of legislation, which was passed by the Health committee via a 7-0 vote (with two members absent). Astute readers may recall that these anti-tobacco measures were introduced in April. However, the language has shifted dramatically and is now more aggressive in the bill that was passed today.

The bill calls for a minimum pricing structure for a cigar, which is defined by New York City as "any roll of tobacco for smoking that is wrapped in leaf tobacco or in any substance containing tobacco, with or without a tip or mouthpiece." In other words, the measure does not distinguish between machine-made and premium, handmade cigars.

Under 1544-B, cigars sold individually must adhere to a price floor and be sold for no less than $8.00. The measure would also assess an excise tax on cigars at the rate of 10 percent of the $8 minimum, or 80 cents. This means that single cigars could not be sold for less than $8.80 apiece, regardless of the MSRP. And this is before state, federal and tobacco taxes are applied.

Moreover, for a box of cigars, the price floor would be calculated by counting the number of cigars in the box, multiplied by $1.75, plus $6.25. The excise tax for a box would break down to be 80 cents for the first cigar, plus .175 cents for each additional cigar.

If the new bill becomes law, a cigar that carries a suggested retail price of, for example, $6.50 would have to be sold for $8, plus it would be taxed a minimum of 80 cents. A box of 20 cigars would need to be sold at a minimum price of $45.38, after taxes.

According to the bill, the revenue generated by the 10 percent tax must be used by New York City to support public housing.

While the vast majority of premium cigars retail for more than $8, the bill passed by the Committee on Health would still affect a good portion of cigars. According to the Cigar Aficionado tasting database, the editors have tested roughly 413 cigars so far in 2017. Of that number, 161 cigars retail for less than $8, or about 39 percent.

"Maybe about 10 percent of my humidor is under eight dollars," says Vincent Nastri, owner of Barclay-Rex, which has operated in the city since 1910. "[The law] will drive consumers to buy out of state."

According to Alejandro Ceballos, sales associate and shipping director of the Davidoff shop on Madison Ave., roughly 5 percent of his humidor is comprised of cigars under eight dollars.

Bill 1544-B is scheduled to be taken up by the full New York City Council tomorrow, where it is expected to pass. After that, the bill would go into effect 270 days after it is signed by Mayor Bill de Blasio.

[Update: The full New York City Council passed Bill 1544-B on August 9 by a vote of 33–9.]

Ignatio Moon August 9, 2017 12:45pm ET
Look on the bright side .. it's not the 86% tax we are forced to pay in Utah.. it's why there is only one decent premium cigar shop in the state.. everyone else goes online
ABRAHAM MARCADIS TAMPA, FL, United States, August 9, 2017 5:49pm ET
buy online
fredrevilla@gmail.com August 9, 2017 8:00pm ET
Pffft...not that big of a deal if you ask me. Sure it means more costly to the cigar consumer, but we already pay more for a premium product. As an American living in the UK, a decent stogie costs at minimum £9 or almost $12! But they do have Cubans here, so I don't complain much.
Stephen Tao Aiea, HI, USA, August 9, 2017 8:04pm ET
You have to be kidding me!!! The government will tax the crap out of hard working cigar smokers to once again give it to welfare and public housing. Cigar smokers are unlike cigarette smokers. We generally smoke one to two cigars a day to relax. Some people even less than that. When will the government ever take care of the hard working middle class people and stop giving everything to the welfare system just to get votes. Unfortunately the government no longer believes in "We the people". I'm afraid for my sons future in the tyrranical government.
Timothy Hodge Aliquippa, PA, USA, August 9, 2017 8:15pm ET
There is hardly anywhere to smoke in NYC anyway unless you're a club member. My guess is the majority stands behind this bill. Nevertheless, I feel for shop owners.
Jerry Mace Noblesville, IN, USA, August 9, 2017 9:54pm ET
What I see happening is they'll be selling machine made blunts black market on the street like they do there with cigarettes now.
If they want a good hand made cigar under the $8+ price point (or, more likely any good cigar, price-wise), they'll just have to purchase online.
I feel sorry for the retailers who are going to be taxed out of existence by the Nanny Statists.
Bobby Grubbs Woodstock, Va., USA, August 11, 2017 8:25am ET
Unbelievable another program to take care of people who won't take care of themselves!! Our system are making people lazy!
N K USA, August 11, 2017 8:11pm ET
Funds generated from the additional tax will go toward tobacco health related issues? No. They're going to support public housing. Another example of the government robbing money from higher earners and give it to poor people. Socialism real and simple. When is someone going to bring this issue all the way to the supreme Court? We need to know if we're a capitalist or socialist nation.
Lew Rothman Morristown, NJ, usa, August 12, 2017 3:21pm ET
"N K USA, August 11, 2017 8:11pm ET
Funds generated from the additional tax will go toward tobacco health related issues? No. They're going to support public housing. Another example of the government robbing money from higher earners and give it to poor people. Socialism real and simple. When is someone going to bring this issue all the way to the supreme Court? We need to know if we're a capitalist or socialist nation."

No funds will be generated...ZERO
This law applies to ALL cigars, not just handmade
So... 99% of the cigars set to be $8.80 plus sales tax are actually cigars that now sell for less than ONE dollar. Mass market cigar smokers are not going to pay 8 to ten times the current price. They will find alternative ways to obtain their cigars and the City will actually collect less tax revenue than they currently do.
Stephen Tao Aiea, HI, USA, August 13, 2017 2:58am ET
Cigars will go to the black market now and the government gets less than before they issued this ridiculous tax. Just another way for the crime syndicates to make more money through illegal sales. Good job idiot government you just made the underground criminal network that much stronger!
Michael Bonney Sequim, WA, USA, August 25, 2017 9:52pm ET
So, if you are rich or upper middle class and don't mind spending $15 for a cigar, not problem. If you are a poor working stiff and enjoy a $3.00 or $4.00 stick, don't belong to a "cigar club", and would just like to take a walk in a park (which you pay for with your taxes) with a reasonable priced cigar forget it. Another "Lets control the poor and middle class because they are stupid" liberal law. Glad I don't live in NYC.

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