Urgent Message To Congress And President Elect Barack Obama


FROM: Thomas Briant, Executive Director NATO

I have attached a copy of the SCHIP advertisement as it will appear in the Monday, January 12, 2009 issue of Roll Call, one of the leading Washington, DC newspapers that is circulated to all members of Congress, all Congressional staff persons, the White House and President-Elect Barack Obama’s staff. The American Wholesale Marketers Association (AWMA) and the Southern Association of Wholesale Distributors (SAWD) also signed onto this advertisement.

As a part of NATO’s on-going efforts to oppose the SCHIP tax increases, I will be sending a copy of the advertisement to all NATO members with a NATO E-News tomorrow. I also plan to have the advertisement faxed from the NATO office to all 535 members of Congress on Monday, January 12th to ensure that U.S. Senators and U.S. Representatives see the advertisement. In addition, we will include the advertisement with the NATO alert that is being sent to retail members over this coming weekend.

Here is a link to a file that will allow you access to the advertisement! Please get the information out to all!




#1 joy on 01.10.09 at 12:43 AM

Thanks for this info I did not all of this and I’m making a call.

#2 Smoker Gal on 01.10.09 at 10:33 PM

I’m calling my Senator on Monday I just hope that those that are concerned will make a simple call. Every retail location that sells cigarettes, every company that distributes cigarettes and those who smoke cigarettes should be flooding the lines opposing using cigarette tax increases to fund the schip program. And all those who see the fallacy of using revenue raised from a quickly declining product should consider what will happen as cost for health care continue to grow – as the category declines how do you fund the program then? Interesting economics!

#3 BIG MO on 01.11.09 at 3:11 AM

Once again Congress is talking about raising federal cigarette taxes. Last year Congress tried for a $6.10 a carton increase to fund a multi-billion dollar expansion of the SCHIP Health Program. This year it could be more!

Your action is needed today!

Philip Morris USA (PM USA) believes that a federal excise tax increase would have a negative impact on the entire tobacco industry including wholesalers and retailers who sell tobacco products. PM USA is opposed to this increase and believes that this tax will promote purchases through untaxed or lower-tax venues, create incentives for contraband tobacco trafficking and harm legitimate businesses including retailers and wholesalers.

We strongly encourage you to express your opposition to your federal elected officials.

Please take moment to Take Action by visiting
to send an e-mail to your legislators or by calling (866) 527-4494 to get patched directly to your legislator’s office.

Thank you for your support! Making your voice heard in Washington can make a difference!

#4 Desert Dude on 01.13.09 at 2:30 AM

This is something I was not aware of. I find it hard to believe but it just seems that the politicians are just worried about votes.

#5 ANTI NACS on 01.13.09 at 4:14 AM

Does anyone know why NACS did not join in and sign off on the letter? Are they not worried about their membership? Or are they afraid to make enemies on the hill rather than stand up for their members.

#6 FUENTE on 01.13.09 at 4:33 PM


SCHIP Legislation Introduced Including
40-cent Cap on Premium Cigars
International Premium Cigar & Pipe Retailers Association (IPCPR)

Bill Looks for Easy Passage Through House of Representatives–House May Vote as Early as Thursday

January 13, 2009 – The latest version of the State Children’s Health Insurance Program (SCHIP), HR2, has been officially introduced in House Ways & Means Committee. The industry compromise on the revised tax rate on large cigars has been incorporated into HR2. The new tax rate will be 52.4% with a maximum tax cap on any one cigar at 40 cents per cigar.

In previous versions of SCHIP legislation, the tax cap rate held at $3 per cigar. Your trade association and its federal lobbyists, working in conjunction with the Cigar Association of America, our industry came together to agressively challenge the distasterous, proposed $3 tax cap, and get the substantially reduced to the more sustainable 40-cent tax cap.

The IPCPR also recognizes the work of the associate members of your association, who were a key component in educating to Congress on our industry. Thank you to our retail members and their customers for supporting our aggressive grassroots efforts.

While HR2 looks to breeze through the House, it may have a slower journey through the Senate, though we do not expect any direct changes to the tax cap rate.

SCHIP Legislation Details

The new tax rates are effective April 1, 2009;
The cigarette tax rate goes from $.39 per pack to $1.00 per pack;
The tax on snuff goes from $.585 per pound to $1.50 per pound;
The tax on pipe tobacco goes from $1.0969 per pound to $2.8126 per pound;
The tax on RYO goes from $1.0969 per pound to $24.62 per pound (not a typo).
Additionally the definition of RYO has been expanded to include cigar wrappers to address the “blunt wraps” issue;
The tax change to small cigars (cigars weighing less the three (3) pounds per thousand will be phased in over five (5) years at the following rates per year:
2009 & 2010 – $.25 per pack
2011 & 2012 – $.50 per pack
2013 & 2014 – $.75 per pack
2015 and beyond – $1.00 per pack

We were successful in continuing to have the floor tax NOT apply to large cigars; however it does pertain to any other tobacco products.
The International Premium Cigar & Pipe Retailers Association (IPCPR) is a not-for-profit trade association organized as the advocate for the independent retail tobacconist and recognized as the “Voice of Authority and Reason” on premium tobacco related issues.

International Premium Cigar & Pipe Retailers Association (IPCPR)

#7 The OTP Kid on 01.13.09 at 6:17 PM

The cigar lobby (CAA) appears to have thrown all of the other categories under the bus, particularly RYO. If anyone hasn’t figured it out, the cigar folks only take care of themselves and when they talk to other manufacturers in the industry, it’s not to help fight taxes, it’s to find out what they are doing so they can use it to their advantage!

#8 jancascade on 01.14.09 at 1:24 AM

If only we had a leader in this industry, it is too fragmented. If smokers voted, we would have on hell of a voting block. Sadly people are just apathetic and that is really too bad.

I am tired of talking to people and getting only glassy stares back. I would like to shake them!

#9 Bertram52 on 01.14.09 at 4:59 PM

I think RYO should be thrown under the bus — biggest bunch of louts in the industry.

#10 jancascade on 01.14.09 at 7:14 PM

Bertram, you are wrong here. There are some really fine companies making quality RYO tobacco without all the nasty garbage in manufactured cigarette or bargain basment floor sweepings with as many chemicals as manufacturered cigarettes. Pure high quality tobacco made in the USA.

#11 The OTP Kid on 01.15.09 at 12:07 PM

Let’s all be clear on what the cigar lobby did when they successfully capped the cigar tax (52%) at 40 cents per cigar, aside from the obvious profit motive. The CAA and the IPCPR protected thousands of jobs in third wolrd countries like the Domincan Republic, Hondurus and Nicarauga. My RYO suppliers will have to let American workers go into the unemployment line thanks to this SCHIP bill. Congress protects foreign jobs and forces companies in America to throw their people into the cold.

Remember that the next time you light up one of those over-priced (and over-rated) Fuentes!

#12 Bill Godshall on 01.15.09 at 12:52 PM

I’d be surprised if the cigar industry urged Congress to increase the tax on RYO, as the cigar industry was lobbying for the phase in tax for little cigars and to reduce the cap on large cigars.

CTFK was urging Congress to further increase the tax rate on RYO and smokeless, while opposing changes in the large cigar cap and the phase in for little cigars.

With the new rates, cigarettes, RYO and small cigars will all be taxed at $1/pack (except the small cigar change will be phased in over the next 6 years).

Considering that RYO sales have increased during the past decade primarily because RYO was/is taxed at a much lower rate than cigarettes (at the federal level and in most states), the new tax rates appear to have leveled the playing field again.

#13 jancascade on 01.15.09 at 6:44 PM

In our state, we must pay state tax at a rate of 65% on the federal tax. The two taxes combined make it almost $40.00 tax for a pound of cigarette tobacco. We will not be selling it anymore. We only sold the high end, high quality RYO, not the mass market chemical landen garbage that is marketed as cheap for the masses.

No need to sell the RYO accessories either, so there goes more tax revenue the state and federal government will lose as more and more retailers choose to limit their inventory and tax liability.

SCHIP is not sustainable now or in good economic times. Eventually, the parasites kill the host. No sin, no tax.

#14 Extreme Eddie on 01.21.09 at 4:37 PM

Read this today online:

Buffalo News
January 21, 2009 –
BUFFALO, N.Y. – If Congress passes a measure to enlarge the State Children’s Health Insurance Program (SCHIP) by raising federal cigarette and tobacco taxes, the result would cripple several industries, including convenience stores, writes Scott Ramminger in the Buffalo News. NACS is among several trade organizations he listed that opposes the increase of the federal tobacco and cigarette tax.

Ramminger, president of the American Wholesale Marketers Association (AWMA), wrote that the result of such a bill would “be major sales reductions, massive layoffs, numerous store closings and many more robberies because of the much higher value of tobacco products.”

AWMA supports the SCHIP expansion, but not at the price of raising the federal excise tax on cigarettes, cigars, pipe tobacco, smokeless tobacco and roll-your-own tobacco. Ramminger listed several ways that the “economic impact on the entire tobacco industry will be disastrous.”

First, higher taxes would result in a drop in retail sales of tobacco, which would impact industry jobs. Second, the value of tobacco products held in inventory would significantly increase, making warehouses, delivery vehicles and retailers more likely targets for crime.

Third, more taxes on tobacco products will drive consumers to the Internet and black market to purchase products. Fourth, raising tobacco taxes will disproportionately affect the poor, given that more Americans in the low- or middle-income bracket purchase tobacco products.

Ramminger concluded with this plea: “Our organizations implore Congress to reauthorize SCHIP without imposing disastrously large tax increases on tobacco products.”

#15 TAZ on 01.24.09 at 2:07 AM

FROM: Thomas Briant, Executive Director NATO
White House SCHIP Form
As the next step in NATO’s efforts to oppose the SCHIP tax increases on cigarettes and tobacco products, please see the attached White House SCHIP Form. This form is a message to President Barack Obama to be a man of his word and keep his promise to not raise taxes on any American earning less than $250,000 a year.
As of this morning, the White House fax machine is operational once again given the change over in administrations. Every NATO retailer, wholesaler and manufacturer are asked to do the following:
1. Print the attached White House Form down and distribute it to your employees and your customers. Ask them to check the boxes on the form that apply to them, sign their name, include the city and state where they live, and then fax the forms directly to the White House. If the form does not go through, it only means that the White House fax machine is busy. Keep trying to fax the forms so that the President hears our message that he needs to keep his promise. Continue to fax in forms every day over the next week, including this Saturday and Sunday.
2. Forward this message and the attached White House Form to other employees in your company, your retail accounts and any other organization or individual whom you believe will help distribute these forms to concerned citizens.
As always, your help in continuing to fight the SCHIP tax increases is sincerely appreciated.

To: President Barack Obama

I am an American and earn less than $250,000 a year.

Check all that apply below:

□ I work at a retail store, wholesale business or
manufacturing company that sells tobacco products.

□ I am very concerned that I may lose my job if the federal
cigarette and tobacco taxes are increased.

□ I own a retail store or wholesale business that sells tobacco
products and I am worried that these tax increases will
force me out of business.

□ I buy tobacco products and these tax increases on cigarettes
and tobacco products are unfair and wrong.


Mr. President, I expect you to be a man of your word and keep your promise by not raising taxes on Americans that earn less than $250,000, including cigarette and tobacco taxes to expand the State Children’s Health Insurance Program (SCHIP).

Signed: ___________________________________________

City: ______________________ State: ____________

Fax to the White House at 202-456-2461

Or you can download the fax here.

#16 Smoker Gal on 01.24.09 at 7:53 PM

Thanks for the fax page!

#17 BIG MO on 01.28.09 at 3:06 AM


Where are you lately?
Miss your insoght?

#18 BIG MO on 01.28.09 at 3:19 AM

The Council of Independent Tobacco Manufacturers of America, a trade group comprising compliant non-participating cigarette manufacturers, urged US lawmakers on January 26th to support the original version of the State Children’s Health Insurance Program (SCHIP) bill voted in 2008 by US House and Senate members that would have increased the Federal excise tax on roll-your-own (RYO) tobacco from $1 to $8.92 per pound, instead of $24 per pound as proposed by the current SCHIP expansion bill.(PR Newswire 01/26)

#19 Reynold on 01.28.09 at 5:22 AM

Dear President,
I’am very anxious about your debate this morning regarding the STIMILUS PACKAGE. Here are some KEY TIPS for you. PLEASE, LISTEN:
-AMEND the Package.
-Put AGRICULTURE, AGRICULTURE, and AGRICULTURE as top priority in your debate.
-Invest 50% of the money to PRODUCE THE CHEAPEST FOOD to CONTROL to the world. That will create jobs, and bring revenue!
-Then, focus on HOUSING , ENERGY, and HEALTH CARE.

#20 Bill Godshall on 01.28.09 at 2:42 PM

Does anyone know if cigarillos and other small cigars (that aren’t in packages of 20) are considered “little cigars” or “large cigars” in the SCHIP legislation (and presumably in the current FET)?

I posted a similar inquiry on this blog several days ago, but can no longer find that thread.

#21 TAZ on 01.30.09 at 10:20 AM

WASHINGTON — The U.S. Senate voted 66-32 late yesterday to add
$31.5 billion over 4-1/2 years to the State Children’s Health Insurance Program, or SCHIP, expanding coverage to more than 11 million children from 7.4 million last year. The House passed a similar measure on Jan. 14, and the two versions must be reconciled before the legislation is sent to President Barack Obama, who praised the Senate for approving the bill.

Funding for the expanded program will be covered through increased federal excise taxes on tobacco products, an issue that has raised alarms in many segments of the convenience-store and tobacco-sales industries.

#22 TAZ on 01.30.09 at 10:25 AM

Your questions were answered by John Rolfe on the Schip – more taxes posting. Hope it helps!

#23 TAZ on 02.02.09 at 10:41 AM

Here is a very interesting article on the repercussions of the SCHIP legislation!

Tobacco Tax Turmoil (Part 1)
SCHIP vote leaves retailers reeling over likely sales declines, security issues

By Steve Holtz

WASHINGTON — Between now and April 1, retailer Fred Hoyt is going to be redoubling his customer-service training efforts, reviewing his marketing practices and underscoring the convenience of his stores. Oh, and one other thing: “We’re updating and replacing all of our security camera systems and we’re putting bars on all of our stores, something that I’ve sidestepped for the last 25 or 30 years,” he told CSP Daily News. Why? “Because the black market [on cigarettes] is going to be flourishing.”

From expected sales drops to security issues, the Senate’s approval last week of an expanded State Children’s Health Insurance Program (SCHIP) is a multilayered threat to the convenience-store and tobacco industries, according to Hoyt (pictured), president of Smoke N Go LLC, a chain of 18 smoke shop/convenience stores based in Abbeville, La.

“This is going to hurt small tobacco manufacturers, tobacco wholesalers and tobacco retailers,” Hoyt said.

There are striking differences in reactions to the Senate approving the expansion of SCHIP, however, illustrating how hard not two, but three sides were fighting for or against the bill.

On the one hand, fans of universal insurance coverage saw the bill as an important first step for President Barack Obama to make good on his campaign pledge to cover all Americans. On another, the bill is a huge step toward reducing tobacco use. Finally, the bill is increasing federal excise taxes on all tobacco products, effectively pricing them out of reach for many consumers. If you’re keeping score, that’s two major groups (health insurance advocates and the anti-tobacco lobby) in favor of the bill and only one-companies relying on income from tobacco sales-against.

Tom Briant, executive director of the National Association of Tobacco Outlets (NATO), however, doesn’t feel the issue is strictly a matter of being outnumbered.

“It’s simply that the attitude toward tobacco is not changing, and that attitude is held too far and wide by a majority in Congress,” Briant told CSP Daily News. “They simply see our products as a target for additional revenue.”

The Senate voted 66-32 Thursday in favor of the bill, as reported in a CSP Daily News Flash Friday. Proposed amendments to the bill that would have lessened the blow to retailers were not included in the approved version.

The new cigarette federal excise tax (FET) amounts to a 156% increase over the current tax of 39 cents per pack, bringing the total FET for a pack of cigarettes to $1. To see other tax-rate changes that are part of the approved Senate bill, click the “Download Now” button below.

The Senate vote followed on an earlier approval of a similar bill by the House. Now the two bills will go before a conference committee to hammer out final legislation, back to each branch for a final vote, and finally land on Obama’s desk for his expected signature as soon as this week.

“I don’t foresee that there will be any changes and that it will breeze through that [process],” said Hoyt, a former U.S. congressman. “The president will sign [the bill], breaking his first pledge to the people of America by taxing the people that make less than $250,000 a year.”

That’s been one of the rallying cries of NATO as it encouraged retailers to call their representatives and urge them to vote against the bill.

Meanwhile, NACS, which also opposed the bill, has been stressing the security factor, according to Chris Tampio, senior director of government affairs of the c-store association.

“The No. 1 thing we talk about when we discuss excise tax increases is the way that government-state, local and federal-they’re making tobacco a commodity, which is forcing people to the black and gray markets. People are buying on the Internet; they’re buying illegally,” Tampio told CSP Daily News. “[The industry] has done a great job to stop robberies over the past 10 years to protect cash and protect employees. Now people are robbing convenience stores, ignoring the cash and just taking cigarettes because they’ve created such a commodity. So we ask Congress, ‘Are you trying to make our stores unsafe again?’ ”

Tomorrow, CSP Daily News will delve into several aspects of the FET increase, including:

How much are cigarette sales expected to drop?
Are jobs at stake, and if so, how many?
Which tobacco category will be hit hardest? (Hint: roll-your-own)
What will the floor tax mean to retailers?
Is there an up side?

#24 Anonymous on 02.03.09 at 2:35 AM

I strongly detest this bill, not only because of the tax increase, but because it will kill the RYO industry which means that if people continue to smoke, they will have to smoke chemically laden pieces of cardboard, because that is what makes up a good portion of a manufactured cigarette, where as RYO is made of pure tobacco leaf. It may still have some additives in the really cheap kinds, but nothing compared to manufactured smokes.

#25 Bill Godshall on 02.04.09 at 5:56 PM

The new law won’t kill the RYO industry, but is likely to reduce RYO sales/consumption by 10%-30%.

#26 smoke obama - don't steal on 02.08.09 at 8:11 PM

Obama is a criminal,he is stealing money from smokers…how about food – that causes way more health problems than tobbaco – and where are ANTI-FOOD GROUPS – they dont exist…WHYYYYYY…or how about air-pollution and huge health problems caused by use of gasoline and cars….how about 200 percent tax increase on every single gallon of gas…or every single new or used car sold….and where are ANTI-GAS GROUPS…they dont even exist…or how about this…why shouldn’t this criminal Obama sign a bill that would take away 70 percent of income for people that earn more than 200.000 dollars per year…and fund his fake “programs”…so he can live on 30.000 per year or less…like most of the smokers HE IS STEALING MONEY FROM…Obama is a criminal…and I am so glad I didn’t vote for him

#27 smoke obama - don't steal on 02.08.09 at 10:43 PM

it’s all about money…not about health…if criminal Obama cared about healthcare of children so much he would donate everything he earns above 30.000 dollars to this fake “program” …but no,he will steal that money from smokers that earn 30.000 or less….

if it was about health,LET’S OUTLAW SMOKING….fine…(but they won’t outlaw smoking simply beacuse they are interested in your money and nothing else)…

if criminal obama was interested in protecting the health of children he would OUTLAW tobacco…but he’s not gonna do that…because if he was we could say: let’s then outlaw everything that causes health problems …. first of all…every time non-smokers (and smokers) turn their cars on they release toxins in the air poisoning every living organism in our enviroment…so,what are we going to do about it….let;s outlaw gasoline and every single car that is using it…RIGHT NOW…take ’em of the road…RIGHT NOW…all of the….for god’s sake there are hundreds of millions of cars poisoning us EVERY SINGLE DAY…and now…when tobacco and gasoline are outlawed…the next thing is FOOD…it causes way more health problems than tobacco and gasoline combined!!!…so,let’s outlaw food…and what is going to happen…all people will starve to death….AND THERE WILL BE NO MORE HEALTH PROBLEMS (because all of people died from starvation)…pronlem solved!!!!! FOREVER :))

but it’s not about their concearn about your health…the only thing they are concearned about is STEALING MORE MONEY FROM THE POOR…a few years ago the price of cigarettes was doubled….and does anybody know where that money is going???have you ever heard of any smoker that needed some medical treatment getting any of that money..so he can pay his medical bills?????????Where is then that obscene amount of money going to…EVERY YEAR????????Does anybody know?It goes to the government and it spends it anywhere it wants (except healthcare)…all smokers are officially SLAVES to the government,working hard so they can take your money away…and criminal obama is your new master.

#28 TAZ on 02.19.09 at 5:13 PM

The US Alcohol and Tobacco Tax and Trade Bureau (TTB) has published at http://www.ttb.gov/index.shtml guidelines for implementing the Federal excise tax increase on tobacco products, the American Wholesale Marketers Association said. (AWMA 02/19)

#29 Big Tuna on 03.10.09 at 10:40 PM

I agree I’d love to see the supposed tax for health be spent on health but the reality is the folks in government that are providing all the assisted help programs for our lazyass society will one day take our freedoms away unless folks stand up. We deserve this plight if we are lazy and don’t care! I am not one of those folks and will fight till the end for the truth! Not deception!

#30 WhitePony on 03.15.09 at 1:41 PM

I really do hope I am alive to see the next revolution in this country happen….I for one get just a little more pissed off each day at those in charge…..

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