Wednesday, September 7, 2016

Cigars, Cigarettes, Tiparillo's

In the early 1600's American Indians introduced early European settlers to a local crop called tobacco.  The product soon became popular as a trade item and tobacco shops sprang up over Europe. Because the general population was illiterate stores used wooden Indians, generally placed outside the shops, to attract customers.

Early forms of tobacco were too harsh to smoke directly so they were smoked in a pipe or bong (water pipe). Later strains of Virginia and burley tobacco were light enough to be enjoyed directly when rolled into a cigar or cigarette.

In the 1970s, Brown & Williamson cross-bred a strain of tobacco to produce Y1. This strain of tobacco contained an unusually high amount of nicotine, nearly doubling its content from 3.2-3.5% to 6.5%. In the 1990s, this prompted the Food and Drug Administration to use this strain as evidence that tobacco companies were intentionally manipulating the nicotine content of cigarettes. - Wikipedia

Since the year 2000 the FDA has increased its' stranglehold on the tobacco industry, by issuing one new regulation after another in an attempt to cripple the industry.

In May of 2016 the FDA issued regulations under its' "deeming" rule which is a broad way of saying anything they deem to be a tobacco product now comes under their jurisdiction.

If you wish, you may view this in the same vein as the Obamacare medical device tax. Under the guise of making health care affordable the Obamacare laws assess a 2.3% tax on medical devices. The tax is levied at the wholesale level which is then passed on to consumers in the form of higher health care costs. Higher health care costs means higher insurance premiums so the consumer has a double dose of taxes.

The deeming rule is all encompassing, impacting almost every form of tobacco, products used to consume tobacco, people who manufacture tobacco products, those who sell tobacco products .........

This 500 page law threatens the premium cigar industry in much the same way as the 1991 luxury tax on expensive boats that essentially killed the yacht industry in Florida.

Now, instead of boats the FDA wants to drive small "premium" cigar makers and retailers out of business.

“By their own appraisal, their new regulations would wipe out somewhere between 10 and 50 percent of these products as it will not be cost effective to put many of the products through review,” writes the Tax Foundation’s Scott Drenkard.

“The premium cigar industry is composed of some big players, but also many smaller businesses and boutique brands, many of which will likely go by the wayside,” Drenkard added. 

I think there is some likelihood that the dearth of options in the new regulated American cigar market turns more consumers over to black market sales on the internet, specifically international sales of smuggled Cuban cigars. The irony of American consumers turning to a communist country for more market choices is, of course, hard to miss.- Daily Caller

In much the same way that Florida was once home to a thriving luxury boat industry, the Everglade state is also home to some of the best premium cigars produced in this country.

There are those who still debate whether or not Obamacare was designed to crush the health insurance industry into oblivion. That same argument will now be made concerning the FDA and the cigar industry.

As Emille Mustafa puffed a plume of smoke into the air and it disappeared, she worried her family cigar business may soon fade away, too.

Costly new federal rules for cigars, electronic cigarettes and other smoking products that had been relatively unregulated could snuff out small cigar makers such as Córdoba & Morales, a Casselberry operation owned by Mustafa and her Cuban-born husband, Azarias Mustafa Córdoba.

If the rules go into effect, "it would put us out of business," she said of their company, launched five years ago. - Orlando Sentinel

If you like what Obamacare has done to your ability to keep your doctor and lower your health insurance premiums, you are going to love the new and improved FDA deeming rules on tobacco products.

Should a gentleman offer a lady a Tiparillo?

Only if the FDA doesn't object.

Is anything beyond the reach of the FDA? What about those e-cigarettes?

Stay tuned.

#FDAdeemingrules  #Cigars

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