Cigar Imports and the SCHIP Tax

For those unfamiliar with the SCHIP or State Children’s Health Insurance Program tax, it was a very substantial increase in the tax on imported cigars, which President Obama signed into law and that went into effect April 1st of this year.

Here is a link to an article that talks about cigar imports in the month of April and for the first 4 months of 2009 provided by US Customs data:
http://www.cigarcyclopedia.com/webapp/content/view/1479/27/

Some quick notes about the article:
*Cigar imports in April dropped by 57% as compared to last year.

*While cigar imports dropped in April, and were expected to drop in May and June based on preliminary data, from January to April 2009, Cigar imports to the US are actually 42.7% ahead of last years imports.

*Surprisingly this trend is not really explained at all. Common sense says that manufacturers and vendors were trying to get as much product into the country before the SCHIP tax came into effect, however it is not mentioned.

I find this conclusion particularly too rosy colored: "The all-types totals show 2009 imports of 567.36 million cigars, a terrific 50.4% ahead of the 2008 four-month total of 377.12 million. While the anti-tobacco activists crow about the “death” of Big Tobacco thanks to new legislation that gives the U.S. Food & Drug Administration oversight of cigarettes, the relatively small group of Americans who enjoy cigars . . . are still enjoying them, thank you."

Just another example of people looking at the world through rose colored glasses. Figures from May and June are not in yet, and I suspect there has been a significant decrease in cigar imports as well as prices have gone up a signifcant, but not an exorbitant, amount.