Exempting Fine Cigars from FDA Oversight:
What are the Odds?

It's been said that the premium cigar industry waited far too long to get its seat at the legislative table of tobacco regulation policy. In recent years, the industry has been trying to make up for lost time.

That isn't to say cigar interests were entirely asleep at the wheel, as evidenced by a variety of strategic battles fought over the years to defend against unwieldy tax hikes or restrictions on the freedoms of adults to enjoy cigars. But compared to other industry segments that had long been on the defense, premium cigars - a tiny sliver of the overall market in comparison - were largely unrepresented in many key developments.

The anti-tobacco backlash that's been unleashed in recent years has been unprecedented, from comprehensive smoking bans to tobacco excise tax hikes, including the unprecedented $33 billion Children's Health Insurance Program Reauthorization Act of 2009 (S-CHIP). That initiative alone, created to fund expanded health care for children, forever changed the pricing structure of all tobacco products. It clobbered retailers with an inventory assessment, piled substantial excise taxes onto product makers, and unleashed a new round of regulatory controls. Margins for manufacturers and retailers alike were dramatically squeezed - not nearly as serious for the high volume cigarette industry, but a significant blow to the low volume, handmade premium cigar makers. In most cases, consumers end up bearing the brunt of those passed-along costs.

But that was then, and this is now. Should the Federal Food and Drug Administration (FDA) extend its control over tobacco (currently limited to cigarettes and chewing tobacco) to include cigars, it could could "rip the soul of the cigar industry apart," as the feverishly active Cigar Rights of American (CRA) describes it. FDA has repeatedly said it intends to regulate cigars, and the repercussion on high-end cigars could be off the wall: bans on walk-in humidors, the end of cigar box artwork as we know it, paralyzing regulations effectively destroying the ability of makers to introduce new cigar blends, to name just a few.

Government isn't too terribly concerned about the differences between various tobacco products beyond the need to classify them in a practical way for taxation purposes. The incongruity of government's war on tobacco and simultaneous dependence on its significant tax revenue is famously hypocritical, but special interest pressure to crack away at every conceivable angle to shut down tobacco entirely continues to mount. Tobacco - like many adult products - is already illegal for minors to purchase, yet it is adult access to this legal product that is increasingly threatened under the guise of a youth access epidemic.

But premium cigars do not appeal to underage smokers, it is argued, because of their inherently high costs. And the use of flavors - which tobacco critics howl are merely subversive methods of attracting underage smokers, aren't really an issue in high end cigars either. So why should premium cigars be lumped in with all of the youth access concerns of mass market tobacco products?

Separating itself from all other tobacco products has become a mantra in recent years for premium cigar makers. They have worked hard to introduce and gain support for bi-partisan Congressional legislation decreeing that traditional, premium cigars should be off-limits to FDA regulation. The current version, titled the "Traditional Cigar Manufacturing and Small Business Jobs Preservation Act of 2013," was introduced in the U.S. House of Representatives by Florida Representative Bill Posey as H.R. 792 and currently has 123 cosponsors. In the U.S. Senate, it was introduced by Florida Sen. Bill Nelson as S. 772, and currently has 10 cosponsors.

It's an unprecedented accomplishment, but the road to success is daunting, particularly for one requiring legislators to publically express support of any kind for tobacco. Of the average 8,500 bills introduced in a typical year, only about 5 percent of them are ever enacted, which is why CRA (www.cigarrights.org) is imploring cigar lovers nationwide to speak up.

- E.E.H.

SMOKE Volume 18, Issue 1


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