News: Senate Finance Committee

As we reported yesterday, Rocky Patel testified today before the Senate Finance Committee. The hearing which took place this morning was called “Tobacco: Taxes Owed, Avoided and Evaded”. The sad thing about today’s hearing while watching it was that there were more witnesses in the chamber then actual committee members of which we counted three. The chairman Ron Wyden, a Democrat from Oregon was present along with Senator Mark Warner another Democrat from the Commonwealth of Virgina and a Republican, Mike Crapo from Idaho who we did not  offer any questions to the witnesses.

Most of the hearing was around the labeling issues of pipe tobacco which is often used in the RYO community for rolling cigarettes. Pipe Tobacco is taxed at a lower rate, and many RYO companies label their tobacco as such to pay lower taxes.

However, one question stood out this morning when Rocky Patel took the stand shortly before 11am. After Mr. Patel and other witnesses introduced themselves with statements, Senator Wyden proposed the question, asking if Rocky Patel would be OK with going back to the drawing board and defining a clear definition of what constitutes a cigarette and what constitutes a cigar.

Rocky Patel responded that he would be willing to discuss this option as the Tax & Trade Bureau needs a concise definition of what a premium cigar is, what a large cigar is and what a small cigar is.

Even more intriguing was that Senator Wyden responded that he was anxious to Rocky Patel’s suggestions.

The rest of the hearing centered on E-Cigarettes and how there is no regulation on it. Ronald Bernstein a CEO from the company who makes Eve cigarettes informed the Committee of a lady who prepares liquid which is injected into E-Cigarettes. He went on to say that the E-liquid lady is unregulated as to what concoction she puts into her mixtures.

The hearing was summed up with Wyden going on a rant about this being a classic case of tax evasion and that the government is foot-dragging. Wyden seemed particularly annoyed when an administrator from Alcohol and Tobacco Trade Tax Bureau responded that his agency could not regulate e-cigarettes since there was no tobacco in them.

Where this leads is not my forte, but as more becomes available we report it.

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