Not a big fan of some of his policies but this is a good veto! Why should my cigar purchases fund free health care for the kids of a family making 80K a year??? One family sends their kid to a 10k a year private school with the health care savings!!!
Wednesday, October 3rd, 2007 This morning President Bush carried through on his promise to veto the SCHIP bill which contained large tax increases on tobacco. The veto ceremony took place quietly before he left Washington to travel to Lancaster, Pennsylvania.
The veto, which is only the forth of Bush’s presidency, stops a 256% increase of the excise tax on cigars to 53%. The proposed tax also raised the cap on from 5 cents to $3 per cigar. The combined effect would have raised the price of many premium and ultra-premium cigars by $100 or more per box.
While many in the cigar industry will applaud the veto, Bush has spoken little about the tobacco taxes. His opposition to the bill has instead been focused on a desire to halt expansion of SCHIP to children of families whose income levels are far above the threshold for government assistance. While not cited specifically by Bush, other critics of SCHIP expansion cite as an example this New Jersey family who, with assistance from SCHIP, can to afford to send their daughter to a nearly $10,000 per year private school.
As we reported earlier, SCHIP supporters in the Senate appear to have the votes to override the veto. However, the House remains short of the two-thirds threshold, meaning that at least for now cigar taxes will remain the same.
Stogie Guys Analysis
Unfortunately, cigar smokers and others who oppose these excessive and punitive cigar taxes should take little solace in this outcome.
Yes, Bush vetoed the bill, and yes they seem able to muster enough opposition in the House to sustain the veto, but this will still be very damaging long term. Anti-tobacco forces now have majorities in both houses on the record supporting large tax increases on tobacco.
So, the next time the government wants to raise taxes on tobacco, all these politicians will be on the record in support of it. Any one who changes their vote in future can be accused of “flip-flopping.”
This can (and likely will be) damaging in the future when Bush isn’t there to veto such tax increases. Right now it looks fairly likely that the next White House occupant will support raising tobacco taxes. (All the Democrats supported this increase and even Republican hopeful Mike Huckabee has indicated he is in favor of taxing/banning tobacco.)
That’s why, even though the current tax hikes might not get through, this is a very bad loss for adults who want to be able to enjoy cigars with out paying outrageous taxes on these legal products. Also, as George expressed in his commentary on Monday, the cigar industry should have done a better job on this issue.
-Patrick S
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