Close the Tobacco Loophole
Time to celler up fellas! The introduction of the End Tobacco Loopholes Act has a number of aims. First, to increase the amount of Federal tax on tobacco products making it more expensive for people to buy. Second, to harmonize the tax rate across tobacco products (currently cigarettes are taxed higher than pipe tobacco, cigars, and smokeless tobacco). Third, this increase, if implemented, would tie any subsequent increases to inflation so the tax cost would automatically rise with inflation. Fourth, by doing this, the government is going to follow individual States’ movement to start taxing vaping products (not that any of us are especially concerned with that!).
So what amount are we talking here? I’ve included the links to the proposed Act along with another link that better explains the government’s aims.
“Section 5701(f) of the Internal Revenue Code of 1986 is amended by striking “$2.8311 cents” and inserting “$49.56”.”
This is a huge increase. There has been no federal tobacco tax increase since 1986! This has kept pipe tobacco throughout the US at prices we in Canada drooled over. If this bill passes, that will now come to an end.
Of note, I was recently up in Montreal, Quebec at a pipe store where I purchased a pipe. I was speaking with the one of the owners about the lack of tobacco in the shop. A long while ago, Quebec passed an act that prohibits the selling of any flavoured tobacco. You can imagine the hit that they took on that one! Well, he said that it’s getting really difficult in ordering tobacco from any of their Distributors because the Distributors themselves are having a tough time in purchasing and acquiring the tobacco they need to pump through to the stores. And the number of stores declines over time.
All of this points to a time where tobacco is going to become REALLY expensive for everyone. A nice cellar if you can build one up would be a worthy investment. But make sure you watch for any legislation that limits the legal amount of tobacco any citizen can hold in their own home. We have these limits in Canada. I cringe when I see someone in Canada showing photos of their cellars and posting about how much they have. Shhhhhh! Best to remain mute and confide in a few close friends instead.
Here endeth the Epistle. Thanks everyone!
https://tobaccoreporter.com/2025/03/04/legislation-introduced-to-close-tobacco-loopholes/#:~:text=But%20federal%20law%20has%20not,a%20comparable%20rate%20to%20cigarettes.”
Text of H.R. 1798: End Tobacco Loopholes Act (Introduced version) - GovTrack.us - https://www.govtrack.us/congress/bills/119/hr1798/text
Time to celler up fellas! The introduction of the End Tobacco Loopholes Act has a number of aims. First, to increase the amount of Federal tax on tobacco products making it more expensive for people to buy. Second, to harmonize the tax rate across tobacco products (currently cigarettes are taxed higher than pipe tobacco, cigars, and smokeless tobacco). Third, this increase, if implemented, would tie any subsequent increases to inflation so the tax cost would automatically rise with inflation. Fourth, by doing this, the government is going to follow individual States’ movement to start taxing vaping products (not that any of us are especially concerned with that!).
So what amount are we talking here? I’ve included the links to the proposed Act along with another link that better explains the government’s aims.
“Section 5701(f) of the Internal Revenue Code of 1986 is amended by striking “$2.8311 cents” and inserting “$49.56”.”
This is a huge increase. There has been no federal tobacco tax increase since 1986! This has kept pipe tobacco throughout the US at prices we in Canada drooled over. If this bill passes, that will now come to an end.
Of note, I was recently up in Montreal, Quebec at a pipe store where I purchased a pipe. I was speaking with the one of the owners about the lack of tobacco in the shop. A long while ago, Quebec passed an act that prohibits the selling of any flavoured tobacco. You can imagine the hit that they took on that one! Well, he said that it’s getting really difficult in ordering tobacco from any of their Distributors because the Distributors themselves are having a tough time in purchasing and acquiring the tobacco they need to pump through to the stores. And the number of stores declines over time.
All of this points to a time where tobacco is going to become REALLY expensive for everyone. A nice cellar if you can build one up would be a worthy investment. But make sure you watch for any legislation that limits the legal amount of tobacco any citizen can hold in their own home. We have these limits in Canada. I cringe when I see someone in Canada showing photos of their cellars and posting about how much they have. Shhhhhh! Best to remain mute and confide in a few close friends instead.
Here endeth the Epistle. Thanks everyone!
https://tobaccoreporter.com/2025/03/04/legislation-introduced-to-close-tobacco-loopholes/#:~:text=But%20federal%20law%20has%20not,a%20comparable%20rate%20to%20cigarettes.”
Text of H.R. 1798: End Tobacco Loopholes Act (Introduced version) - GovTrack.us - https://www.govtrack.us/congress/bills/119/hr1798/text
