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Senate committee snuffs out bill to lower premium cigar taxes

DENVER–The Democrat-controlled Senate Finance Committee on Tuesday voted along party lines to “postpone indefinitely” a bill lowering Colorado’s excise tax rate on premium cigars.

Senate Bill 25-056 sought to cap the statutory excise tax rate at 20 percent on what are referred to as premium cigars, which are currently lumped in with other non-cigarette tobacco products at the much higher rate of 36 percent of the manufacturer’s list price (MLP).  That tax rate is scheduled to jump to a whopping 47 percent of MLP after July 1, 2027.

The 20 percent cap applied only to the statutory excise taxes on tobacco products imposed by Proposition EE, a tobacco tax hike passed in 2020. It did not affect the additional 20 percent tax on premium cigars mandated in the state Constitution via Amendment 35, passed in 2004.

The bill defines “premium” cigars as being “rolled by hand, has a wrapper made of whole tobacco leaves, and does not have a filter of a mouthpiece.”  The bill was sponsored by Sen. Tom Sullivan, a Democrat whose district includes parts of Arapahoe and Douglas counties.

The Colorado legislature’s glossary of terms defines a motion to postpone indefinitely as having the “same effect as moving to kill a bill.”

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