Senate Democrats Take on Tobacco Taxes

New legislation would seek to change federal excise tax rates on tobacco products.

February 04, 2013

WASHINGTON - Last week U.S. Sens. Dick Durbin (D-IL), Frank Lautenberg (D-NJ) and Richard Blumenthal (D-CT) introduced the Tobacco Tax Equity Act (S.194), a bill that seeks to make taxes on pipe tobacco equivalent to cigarette tobacco, reports The Hill.

S.194 would make all tobacco products taxed at the same rate as a pack of cigarettes, which carries the highest federal excise tax among all tobacco products at $1.01 per pack.

"This difference in tax rates doesn??t make sense, and we are already seeing tobacco manufacturers abusing them by changing the labels on their products to avoid paying the higher tax. This bill will stop tobacco manufacturers from gaming the system and protect more children and teens from this dangerous habit," Durbin said

The senators say that closing loopholes in the tobacco tax code would generate roughly $3.6 billion over 10 years.

Groups including the Campaign for Tobacco Free Kids and the American Lung Association support the bill. According to Altria spokesperson David Sutton, the company will review the legislation to assess the specifics of the senators' proposals.

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