PCA’S 2021 GOVERNMENT AFFAIRS HIGHLIGHTS: NO NEW TAXES

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FEDERAL
2021 was a strong year for the Premium Cigar Association’s advocacy efforts and the support of its membership. Consumers, retailers, and manufacturers all felt the positive effects of a strong PCA advocacy presence at both the federal and state levels.

PCA led efforts against the Tobacco Tax Equity Act and its inclusion in the Build Back Better negotiations in both the House and Senate, ultimately protecting the industry from a catastrophic tax increase on premium cigars and pipe tobacco. Through the course of this campaign, PCA facilitated 30,000+ consumer messages to Congress and conducted 150+ Congressional meetings advocating on behalf of the industry. PCA remained steadfast in opposition to the tax increase and built necessary coalitions with coordinate groups, think tanks, Congressional allies, and international partners.

Late in 2021, PCA convened the first virtual summit on premium cigars bringing together policymakers and leaders from across the globe to discuss hot button issues in the industry. The event was a bipartisan discussion with keynotes from Senator Marco Rubio (R-FL) and Senate Foreign Relations Chairman Robert Menendez (D-NJ) along with Víctor -Ito- Bisonó Haza, Minister of Industry, Trade and SMEs of the Dominican Republic and Ambassador to the United States Luis Fernando Suazo Barahona of Honduras. This forum was an important springboard for future collaboration that transcends borders and barriers and will lead to follow-up information sharing and best practices development as it relates to premium cigar legislation and regulations.

PCA and industry allies also worked with Representative Dan Meuser of Pennsylvania and Representative Tom Emmer of Minnesota to relaunch the Congressional Cigar Caucus to build a communication network within Congress to discuss important issues related to the small business retail and family-owned manufacturing of premium cigars. The association plans to work with the caucus to advance positive legislation that will support the industry and to guard against negative action at the federal level.

PCA continues to advocate for the distinctiveness of premium cigars before the Courts, Congress, The White House, and the FDA year in and year out. In 2021, PCA also had to present information on premium cigars to the National Academies of Sciences, Engineering, and Medicine (NASEM) working group on the Health Effects and Usage Patterns of Premium Cigars. This advocacy is ongoing, and NASEM is supposed to release its findings in 2022.

STATE
It has long been said that state capitols are the incubators for tobacco control legislation, and even when legislators should have been consumed with public health issues surrounding the pandemic, many found time and placed effort into bills affecting the simple enjoyment of a premium cigar. However, for 2021, none of the negative bills found enough traction to pass and impact the industry, while a few pieces of legislation advanced that benefit consumers, retailers, and manufacturers.

It is significant to note that none of the bills granting enhanced local authority to regulate and tax advanced beyond committee hearings. Such bills died in Kentucky, Tennessee, Missouri, and Oregon. In that vein, legislation to allow for local smoking regulations was defeated in Florida (but is already back around for the 2022 state legislative cycle). Additionally, bills allowing for nicotine testing as a condition of employment died in Kentucky and was not resurrected in Indiana. With states experiencing budget surpluses, the pressure to raise taxes (of any kind) was mitigated; however, it is worthy to note the defeat of a dramatic tax increase in Maine, lack of advancement of such a proposal in Massachusetts, and, in fact, no 2021 tax increases nationally.

It was a capstone moment for the year to have the governors of Michigan and North Carolina sign premium cigar tax cap legislation. Acting on positive legislative action, these two measures served to epitomize the bipartisan support the cigar industry can muster, especially when community tobacconists organize, and consumers let their voices be heard. These will be the building blocks for a successful 2022 for the premium cigar industry. Positive legislation also passed at the local level in Augusta, Georgia for a new cigar bar ordinance and was introduced in many other localities and states in 2021 that can serve as building blocks for the New Year.