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Maryland currently allows out-of-state vendors to sell premium cigars to customers in Maryland without paying a penny in tobacco or sales tax. File.
Maryland currently allows out-of-state vendors to sell premium cigars to customers in Maryland without paying a penny in tobacco or sales tax. File. (Michael Kubel, Morning call File Photo)

Each year, the American Lung Association evaluates how each state approaches tobacco regulation to judge how they are doing with taxes, smoking cessation and prevention programs and the like. One might assume that Maryland fares well. After all, the state charges a $2-per-pack tax on cigarettes that is, while far from highest in the country (the District of Columbia’s is more than twice as much), higher than the vast majority of states. In reality, Maryland gets a “D” from the health experts on tobacco taxes. Why? The state’s tobacco tax schedule includes loopholes for tobacco products other than cigarettes big enough to drive a tractor-trailer of Pall Malls through.

And to spot one of the most ridiculous, we need only turn to House Bill 1291 and Senate Bill 826, legislation offered during this year’s General Assembly session by Prince George’s Del. Darryl Barnes, a Democrat, and Washington County Sen. Andrew Serafini, a Republican. Their measure correctly identifies a woeful inconsistency but then takes the worst possible action to correct it.

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The cigar industry is preparing to fight a tobacco tax that health advocates hope to push through the General Assembly next year.

Under current law, a “premium” cigar (defined primarily as those hand-rolled from whole tobacco leaves) purchased from an out-of-state source — through a website, perhaps, or by old-fashioned direct mail — faces no tobacco tax or sales tax whatsoever. None. Zip. Zilch. Their fix? Well, it’s to allow in-state tobacco outlets to sell premium cigar tax-free as well. In other words, these lawmakers want to level the playing field so everyone can consume one of the nation’s worst health threats tax-free. That’s right, tax-free.

This is a foolish idea for a number of reasons, but the biggest is that it would likely lower the price of cigars and thus encourage their consumption. Cigars aren’t safe. They contain the same toxic and carcinogenic materials found in cigarettes. They have been linked to cancers of the lung, oral cavity, larynx and esophagus, and regular cigar smokers are more likely to develop chronic obstructive pulmonary disease, which includes bronchitis and emphysema. Indeed, the average cigar contains as much tobacco as an entire pack of cigarettes.

A few days ago Comptroller Peter Franchot said he didn't want to enforce the ban on online sales of premium cigars. He asked legislative leaders and the

Like other states, Maryland has failed to keep tobacco taxes fair — or at least proportionate. There are a number of reasons for this, but for most products in the category known as “other tobacco products” or OTP (including chewing tobacco, pipe tobacco, snuff and cigars), the state charges 15-30 percent of the wholesale price plus the 6 percent sales tax. That’s far below the rate assessed on cigarettes — unless, of course, one judges a cigar to be the equivalent of a single cigarette, which is absurd.

The real fix — at least a reasonable step — would be for lawmakers to pass a bill requiring premium cigars sold from out-of-state sources to pay the same 15 percent tax that in-state buyers pay. Companies that provide these products through the mail have balked at this in the past. An effort to ban out-of-state premium cigar sales in 2011 was quickly abandoned. But, at least according to one analysis, Maryland taxpayers are losing out on more than $2 million in annual revenue for such vital programs as public education and health care by not collecting taxes from out-of-state premium cigar vendors. Currently, Maryland collects more than $42 million in taxes each year from all forms of OTP.

Much attention has been paid this General Assembly session to raising the minimum age to purchase tobacco to 21 instead of 18 and we wholeheartedly support that measure. But Maryland’s messy tobacco tax system deserves to be reevaluated as well.

This can be a complicated issue, of course, but it’s pretty easy to see that if cigarettes deserve to be taxed at $2 per pack, cigars do not deserve to be sold tax-free. That much is obvious. And if any lawmakers have doubts, they should go visit their local pulmonologist and hear their heartbreaking stories of patients who suffer horrific medical problems and deeply regret taking up tobacco, only it’s too late for them. It’s not just cigarette smokers who suffer irreversible damage from smoking, it’s those who puffed cigars as well. If we can discourage Marylanders from following that costly path — or at least force them to pay for a portion of the damage they inflict on society — we have a duty to do so.

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