Is “pipe tobacco” taxed at a lower rate than “cigarette tobacco”?
To save money, I’ve started making my own cigarettes with the filter tubes and the little machine. When I did this before, years ago, I’d by a big bag of loose cigarette tobacco. Now … all I can find is “pipe tobacco”. The tobacco shops sell the tubes and cigarette machines, but all the bagged tobacco now is labeled “pipe tobacco”.
It’s left me wondering if this is just a weird decision on the part of the shop owners, or if maybe a lower tax rate has prompted the manufacturers to simply label everything as “pipe tobacco”.
Anybody know?
ETA: I live in Washington state, if that makes a difference.
And as somebody that (very occasionally) smokes a tobacco pipe, I find it annoying that a bunch of tobacco that isn’t actually good for pipe use is now sold as pipe tobacco.
You will never get a one-size-fits-all answer regarding taxation. You would have to dig into your state’s laws to find the answer. In my state, yes, pipe tobacco is taxed lower than loose cigarette tobacco, and both are taxed lower than packaged cigarettes. Washington has a high cigarette tax, and I would imagine the tax on pipe tobacco is quite a bit less (per ounce).
I should add that the stuff I bought appears to be genuine pipe tobacco - it’s cut coarser than I remember RYO cigarette tobacco being. I just thought it was odd that there was no cigarette tobacco available.
Yes, there are different rates for pipe and RYO tobacco, and yes it does vary by state. See Wikipedia:
The Federal excise tax difference is quite large among the different types of tobacco:[ul]
[li]Chewing: 3.1¢/oz.[/li][li]Pipe:17.7¢/oz.[/li][li]RYO: $1.55/oz.[/li][/ul]
And, yes, tobacco shops will often avoid the tax by misidentifying some types of RYO tobacco as pipe tobacco. Of course, they are generally helpful enough to guide you to what type of pipe tobacco would work best for your papers.