Source: https://www.tobaccolawblog.com/2018/01/increase-proposed-mississippis-tobacco-equity-tax/
Timestamp: 2019-04-26 11:54:36+00:00

Document:
Pending before the Mississippi Legislature is House Bill 906, which, if enacted, would increase the “tobacco equity tax” applicable to cigarettes manufactured by non-signatories to the State’s 1997 tobacco settlement agreement in Moore ex rel. State v. American Tobacco Co., et al., No. 94-1429 (Miss. Ch. Ct. Jackson Cnty.) (the “tobacco settlement agreement”). On January 11, 2018, the bill was referred to the House Ways and Means Committee, which is chaired by the bill’s principal author, Representative Jeffrey C. Smith (R-Dist. 39).
At present, Mississippi’s “tobacco equity tax” is imposed at a rate of 1.35¢ per cigarette (and adjusted for inflation). Miss. Code Ann. § 27-70-5(1)(a), (b). This is in addition to the 3.4¢ per cigarette (and double that for longer cigarettes) excise tax already imposed. See id. § 27-69-13(a). Exempted from the “tobacco equity tax,” however, are “[t]he cigarettes manufactured by any manufacturer which is a party to the tobacco settlement agreement.” Id. § 27-70-5(1)(d).
If enacted, House Bill 906 would raise the “tobacco equity tax” to a rate of 3.4¢ (and adjusted for inflation), representing a more than 150% increase in the base rate of the “tobacco equity tax.” Obviously, the legislation would substantially increase the disparity in taxation of non-signatories’ cigarettes as opposed to signatories’ cigarettes.
It remains to be seen how House Bill 906 will fare in the Mississippi Legislature.
Of note, prior attempts to increase the “tobacco equity tax” have died in committee: House Bill 1732 (2016) [Rep. Charles Busby (R-Dist. 111)]; House Bill 116 (2013) [Rep. Jeffrey C. Smith (R-Dist. 39)]; Senate Bill 2950 (2012) [Sen. John Horhn (D-Dist. 26)]; and House Bill 699 (2012) [Rep. Jeffrey C. Smith (R-Dist. 39)].
And, even if the bill makes it out of committee, it will require the support of supermajorities, as the Mississippi Constitution provides that “[n]o revenue bill, or any bill providing for assessments of property for taxation, shall become a law except by a vote of at least three-fifths of the members of each house present and voting.” Miss. Const. art. 4, § 70.

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