Now that there isn’t a Republican in the white house to kill it, Congressional Democrats claim to be making SCHIP a Top Priority. CQ Politcs reported on Friday, November 6th that Democrats in the US Congress plant to move quickly in the New Year to pass a major expansion of the State Children’s Health Insurance Program (SCHIP). House Speaker Nancy Pelosi was interviewed on National Public Radio the day after the election and stated that the expansion of SCHIP “will probably be one of the first bills we would put on President Obama’s desk.”
For those who recall recent events, the US Senate and House both passed a $35 billion dollar SCHIP expansion bill TWICE but it was vetoed both times by President Bush and the legislative branch was unable to swing enough votes to over-ride the veto both times.
What Does This Mean To You?
Why is this important to pipe and cigar smokers you may ask? Well, because this bill would be funded almost exclusively on the backs (and out of the pocketbooks) of smokers of ALL types.
| Tobacco Prouct | Current Tax Rates | SCHIP Tax Rates | Percentage Tax Increase |
| Cigars | 20.719% of manufacturer’s price; capped at 4.875 cents per cigar | 33% of manufacturer’s price; cap of $3.00/cigar | 6,000% |
| Little Cigars | 4 cents per pack | $1.00 per pack | 2,197% |
| Pipe Tobacco | $1.0969 per pound | $2.8126 per pound | 156.4% |
But that isn’t all, the CQ Politics article points out that the tax increase shown above won’t even cover the cost of the expansion of this program. In fact, the congressional Budget Office issued a report in August of this year which found that a five year expansion of the SCHIP program as envisioned by the House and the Senate will cost close to $45 billion, not the $35 billion they are hoping to raise.
The current SCHIP program is set to expire on March 30, 2009 so they are going to move fast on this. We responsible smokers need to speak out loud and clear that this funding proposal is not only unfair, it is UNSOUND!. Not only will it not fund what they want it to do, thereby continuing to grow our budget deficit even further but it also unfairly targets a small percentage (less than 10%) of the US population to pay for something that they claim is a universal need.
Not only will this hit YOU directly in the wallet in these trying times, but it will likely cause for the closure of many tobacconists around the country that are barely hanging on as it is. This, in turn, will dramatically affect the volume of cigars purchased yearly, decreasing the amount of money raised by this tax increase as demand drops; widening the difference between the funds committed to fund SCHIP and the funds available to pay for it.
And if we look out beyond our own selfish needs, IPCPR and many other organizations predict dire results for the economies of the Dominican Republic, Nicaragua and Honduras as a result of this flawed legislation.
What Can I Do To Help?
Well, we all need to band together and show our elected officials the errors of their thinking in this flawed bill.
Let your US Senator and representative in the House know how the negative impact of this legislation will affect you, affect small businesses in your community and how you feel it will affect our neighbors in cigar producing countries. Make sure that you reference SCHIP in your conversation and how you are rallying your neighbors and fellow business owners to defeat unfair taxation. You should also remind them that as a voting block in their state/district, you WILL remember those that fall prey to the “but it’s for the children” sound-bite mentality behind those supporting this bill.
Helpful Links:
A listing of all the current Senators
How to find your local Representative
Your IMMEDIATE action is the only thing that will keep this proposal from becoming a LAW! Please respond today!
As always, we encourage your responses in the comments section below.