Hawaii’s premium cigar industry denied parity in state tax code

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Hawaii Cigar Association logoThe 2014 Hawai‘i legislative session has ended, and again Hawai‘i’s premium cigar industry has been denied parity and fairness in the state’s tax code.

In 2013 the state Senate passed a cigar tax cap bill (SB188) on premium cigars by a vote of twenty-four to one. This year the House passed its own version of a tax cap (HB1849), which included all large cigars.


Surprisingly, Senate Ways and Means chair David Ige deferred the bill indefinitely, with neither a vote nor a public hearing.

Prior to the deferral, the bill had been amended and sent to the Senate Committee on Health. Amendments included striking the $.50 tax cap on all large cigars and leaving the tax amount open for further debate.

A second amendment would have added language exempting premium cigars from the self-service display ban set to go into effect July 1, 2014. But rather than amending the bill, as the Attorney General’s office suggested, or sending it to conference committee, Senator Ige deferred it, thus killing any hope of its passage this year. This was certainly unexpected, because last year Senator Ige had supported a $.50 tax cap on premium cigars.

Regardless, the HCA would like to thank legislators on both sides for moving us closer to solving the tax disparity on premium cigars and for supporting those of us who create local jobs, support our communities and assure tax revenue for Hawai‘i. Sixty out seventy-six state legislators support a tax cap on cigars, and we are confident that a compromise can be reached in 2015; we believe that lawmakers will pass legislation that benefits local industry and satisfies those who desire fairness in the law.

We would again like to thank those legislators who have supported our cause over the last two years.

Thirty-six of fifty-one House members voting aye for HB1849 and a $.50 per large cigar tax cap in the 2014 session:

Henry Aquino, Karen Awana, Della Au Belatti, Tom Brower, Rida Cabanilla, Romy Cachola, Mele Carroll, Isaac Choy, Denny Coffman, Ty Cullen, Cindy Evans, Richard Fale, Mark Hashem, Linda Ichiyama, Jo Jordan, Derek Kawakami, Chris Lee, Nicole Lowen, Sylvia Luke, Bob McDermott, Angus McKelvey, John Mizuno, Dee Morikawa, Mark Nakashima, Scott Nishimoto, Richard Onishi, Karl Rhoads, Scott Saiki, Calvin Say, Joseph Souki, Mark Takai, James Tokioka, Clift Tsuji, Justin Woodson, Ryan Yamane and Kyle Yamashita.

Twenty-four of twenty-five Senate members voting aye for SB188 and a $.50 per premium cigar tax cap in the 2013 session:

Rosalyn Baker, Suzanne Chun Oakland, Donovan Dela Cruz, Kalani English, Will Espero, Mike Gabbard, Brickwood Galuteria, Josh Green, MD, Clayton Hee, David Ige, Les Ihara, Gilbert Kahele, Gilbert Keith-Agaran, Michelle Kidani, Donna Kim, Ronald Kouchi, Clarence Nishihara, Russell Ruderman, Maile Shimabukuro, Sam Slom, Malama Solomon, Brian Taniguchi, Laura Thielen, Jill Tokuda and Glenn Wakai.

In response to the US Food and Drug Administration’s 241-page document of proposed tobacco regulations released last April, the HCA visited Washington, DC to share our views. Sens. Mazie Hirono and Brian Schatz joined Rep. Colleen Hanabusa in supporting the premium cigar industry by sponsoring Cigar Rights of America’s legislative efforts in S772 and HR792.

Both Sen. Hirono and Rep. Hanabusa have stood by the HCA and CRA since day one of this effort, which began two years ago. Their sponsorship of these bills was a vote for small businesses and job protection. It also sent a message to the FDA that America’s cigar tradition should not be regulated out of existence, particularly because that tradition poses little to no threat to our nation’s youth. The HCA is deeply grateful for their support and willingness to compromise.





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