Ferlo on Cigar Tax

Senator Jim Ferlo of Allegheny County says although a tax on cigars, cigarillos and smokeless tobacco might negatively affect the industry in Pennsylvania, it would "level the playing field" for cigarette smokers, who are currently the only tobacco users taxed. The largest financial burden of the tobacco industry is shipping, Ferlo says, suggesting tobacco companies would rather deal with the tax than increase distribution costs by shipping from other states. "You know, that's a nice thing for them to threaten, but I don't know realistically if [tobacco companies] would just uproot themselves completely," says Ferlo. Governor Rendell's proposition would place a 36-cent tariff on every ten cigars, and the same amount on every ounce of smokeless tobacco. The tax, which would raise an estimated $38 million dollars per year, would take effect in October.