Florida - House backs down on 45-cents-per-pack tax on Dosal Tobacco's low-cost cigarettes..

April 26, 2009 - As promised to protest the move, Dosal Tobacco's Opa-locka plant shut its doors Friday as 165 employees from around the state traveled to Tallahassee to protest a House plan to impose a 45-cents-per-pack tax on their low-cost cigarettes.

When they arrived, the news was good: House leaders had reversed their position. Rep. David Rivera, R-Miami, told the group he had received a commitment from Speaker Larry Cretul and Speaker Designate Dean Cannon that the House will not continue to push for the additional tobacco tax.

The proposal would have imposed a tobacco surcharge on companies, including Dosal, that were not part of a 1998 settlement agreement with the nation's largest tobacco companies. The state sued the tobacco industry to recover the cost of treating Medicaid patients suffering from cancer or other smoking-related illnesses. Bud Chiles, the son of the late Florida Gov. Lawton Chiles, said Dosal should be required to pay the state just as the nation's top three tobacco companies do. Chiles: "The way they've been able to increase their market share is by selling cheap cigarettes to kids and teenagers. They can afford 45 cents... That's a fair share to pay for the healthcare issues and illnesses they cause."

In the past 12 years, Dosal's market share in Florida has soared from 3 percent to 18 percent. The company sells cigarettes wholesale at about $1.95 per pack, after the 62-cents-per-pack increase in the federal cigarette tax. Major-brand cigarettes start at about $3.50 per pack wholesale in Florida. Dosal with its best selling brand 305s (area code in Miami) — which wasn’t part of the state’s landmark settlement with larger tobacco companies — has seen its share of the Florida market rise to about 13%. Meanwhile, larger tobacco companies’ market share has fallen from 97% presettlement to 85%. (Dosal Tobacco Feels Pack of Troubleby Amy Keller, Florida Trend, 3/1/2009)

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Reference: Opa-locka tobacco firm wins reprieve on extra 45-cent tax Dosal Tobacco gets good news from Florida House leaders as workers protest a possible tobacco surcharge in Tallahassee by MARY ELLEN KLAS
Miami Herald/Times Tallahassee Bureau, 4/25/2009.