Cigars and some other tobacco products will go up in price in California starting Saturday, when higher excise taxes for them take effect.

published on June 29, 2017 - 11:20 AM
Written by David Castellon

If you smoke cigars or chew tobacco, it will cost you a little more to do so staring Saturday.

That’s when a new California law goes into effect raising the excise tax on tobacco products other than cigarettes from the current 27.3 percent to 65.08 percent.

The higher taxes are the result of voters in the state having passed Proposition 56 in the November election. The new law raises the excise tax rate on cigarettes and expands the definition of “tobacco products” to include cigars, tobacco and electronic cigarettes sold with nicotine, the state Board of Equalization reports.

The agency is required to annually calculate a tax rate on tobacco products that is equivalent to the combined rate of tax imposed on cigarettes – currently $2.87 for a pack of 20 or a little more than 14 cents per cigarette.

The tobacco products tax is imposed upon the first distribution in California, which means it’s paid to the state by the licensed distributors. That fee likely will be added to the costs for the products that consumers pay.

Other tobacco products affected by the new tax rate include little cigars, smoking tobacco (including shisha, a flavored tobacco smoked using hookahs), snuff and nicotine delivery devices that include e-pipes, vape pens and e-hookahs sold in combination with any liquid or substance containing nicotine or products derived from tobacco or nicotine for human consumption.

Nicotine delivery devices sold without nicotine aren’t subject to the tax.

Not included in the law are products approved by the U.S. Food and Drug Administration as tobacco-cessation products or sold for therapeutic purposes, including nicotine patches. 

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