here's the newsletter released by my local pipe/cigar shop here in CA:
taken *from www.briarpatch.biz
Federal Tax Increase on Tobacco Products
As you may be aware the federal SCHIP (State Children's Health Insurance Program) was approved by Congress and signed into law by President Obama on February 4th. The increased benefits provided by the new plan are being "funded" by increases to federal tobacco excise taxes. These new taxes will take effect on April 1, 2009.*
Yes, this means the prices of your tobacco products will be increasing, some substantially. We know how much the federal taxes will increase, but we are unsure exactly how much prices will increase at the retail level. Because of margins taken by manufacturers and distributors, and California excise tax, retail prices could increase by as much as three times the Federal excise tax increase.*
We will have to pay a 'floor' tax on all tobacco products except for premium cigars. We will not increase the price on cigars until we receive merchandise shipped after April 1st. All other tobacco products will probably have two price increases. One on April 1st and the next when we receive new products that have the taxes and margins added.*
Below are the Federal excise tax increases (remember the retail prices will be higher due to California excise taxes and margins taken through the supply chain):*
Large cigars will increase from 20.719% with a cap of 4.875 cents per cigar to 52.75% with a cap of $.4026 per cigar.*
Little Cigars (cigarillos) will be increased from $.3656 per pack of 20 to $1.01 per pack.*
Cigarettes will increase from $.39 per pack to $1.01 per pack.*
Pipe tobacco will increase from $.0686 per ounce to $.18 per ounce.*
Moist snuff will increase from $.043 per can to $.113 per can.*
RYO tobacco will increase from $.0686 per ounce to $1.55 per ounce. This is not a misprint. RYO tubes will increase from $.10 per box of 200 to $.35 per box.
Depending on supply, we are planning on maintaining our normal inventory levels on all products except RYO Tobacco. Due to the huge expected price increase we will be reducing our inventory.*
If you want to stock up on your favorite product before the prices increase please let us know. If it is not in inventory, we will be happy to take special orders and will do our best to get the order to you before the prices increase. Please order early to be sure you receive your products.
we'll see how the prices increase in April...personally i'm hoping my favs wont go up beyond my price range (although $45 per cigar is already expensive for the ultra premiums i still have $8 cigars that are great) *i'm glad i bought the last 11 Strativarius they had last month for $260...