New York Provides Guidance on Taxability of Little Cigars

Wednesday, September 10th, 2014

A closeup of cigarettes.
New York

The New York Department of Taxation and Finance recently issued guidance on the taxation of little cigars.

New York's tobacco products tax applies to cigarettes and cigars. Cigars and cigarettes are taxed at different rates. Little cigars are subject to the cigarette tax rate rather than the cigar tax rate. Little cigars are therefore taxed $4.35 for 20 little cigars plus $1.0875 for each additional five little cigars. The rate for cigars, in contrast, is 75% of the wholesale price.

A "cigar," for this tax, is a roll of tobacco wrapped in leaf tobacco or in any substance containing tobacco. A "little cigar" is a cigar that meets three requirements. First, it must be a roll for smoking made with any amount of tobacco. Second, it must have a cigar wrapper that is not natural leaf tobacco but that contains some amount or form of tobacco. Third, it must either (1) weigh four pounds or less per one thousand cigars or (2) have a filter made of cellulose acetate or any other integrated filter.

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