By Blake Droesch

Posted February 6, 2017

Patriots owner Robert Kraft has some experience celebrating Super Bowl victories, so it should com as no surprise that the five-time champion came to Houston's NRG Park with a box of premium cigars to pass out after New England's incredible comeback victory in Super Bowl LI. 

After a debilitating first half, an improbable 25-point comeback and a nail-biting overtime drive to defeat the Atlanta Falcons, Kraft was seen handing out Padron 1964 Anniversary Series Maduro cigars to his players and coaching staff as he congratulated them on their victory. 

A video posted to Twitter by NFL.com's Dan Hanzus showed a jovial Kraft navigating the crowded locker room with the box of Padrons. MVP Tom Brady embraced Kraft, but seemed more concerned with his missing Super Bowl jersey than picking up a cigar. 

As far as the cigar selection goes, Kraft's choice seemed to be a good one. This particular line of Padrons tend to enjoy high ratings in Cigar Aficionado's blind tastings. One size, the short-and-squat Hermoso, recently scored 93 points, which is considered outstanding on our 100-point scale. 

The Patriots will bring the Lombardi Trophy home to parade through the streets of Boston tomorrow morning. We'll see which smokes Kraft will be passing out then. 

December 27, 2016

Due to the passage of Proposition 56, effective April 1, 2017, section 30121 (b) of the Revenue and Taxation Code is amended to add little cigars to the definition of "tobacco products" for state taxation purposes. Prior to April 1, 2017, little cigars are considered "cigarettes" for state taxation purposes. Products labeled as little cigars will not be subject to the April 1, 2017 floor stock tax on cigarettes required under Proposition 56. 

Proposition 56 added section 30130.52 to the Revenue and Taxation Code imposing a floor stock/stamp adjustment tax on all retailers, wholesalers and distributors of cigarettes, on each stamped package of cigarettes in their posession or control as of April 1, 2017 at 12:01 a.m., and distributors will also pay a stamp adjustment tax on affixed or unaffixed cigarette tax stamps in their possession or control as of April 1, 2017 at 12:01 a.m. The floor stock tax does not apply to "other tobacco products" as defined under section 30121 (b) of the Revenue and Taxation Code. 

On and after April 1, 2017, the state excise tax will apply to the distribution of little cigars at the same rate as other tobacco products. Currently, the tax rate on the distribution of tobacco products is 27.30 percent of the wholesale cost of the tobacco product. Effective April 1, 2017, distributors of little cigars will be responsible for remitting the Tobacco Product Tax on their distributions of their product. Distributors with stamped packages of small cigars in their inventory on and after April 1, 2017 can distribute the stamped packages of little cigars as "tax paid" tobacco products to wholesalers and retailers until their inventories of stamped packages of little cigars are exhausted. Any unstamped packages of little cigars distributed on and after April 1, 2017 within a distributor's inventory should remain unstamped, and their subsequent distribution to wholesalers and retailers must be substantiated by invoices showing the 27.30 percent of the wholesale cost of the tobacco product charged as tax. 

Effective April 1, 2017, Proposition 56 increases the cigarette tax rate from $0.0435 to $0.1435 per cigarette (the tax on a package of 20 cigarettes will increase from $0.87 to $2.87). The tax on distributions of tobacco products, including little cigars, will also increase at a rate equivalent to the Proposition 56 increase on cigarettes. In April 2017, the Board will determine the tax rate on tobacco products for Fiscal Year 2017-18, which will be based on the wholesale price of cigarettes as of March 1, 2017, and will be equivalent to the tax on cigarettes. We estimate that the tobacco products tax rate will be between 65 and 68 percent on the wholesale cost of the distribution. The tax rate increase on tobacco products will take effect July 1, 2017. There will not be a floor stock tax on other tobacco products.

November 30, 2016

California State Board of Equalization Special Notice

The California State Board of Equalization's (BOE) inspection teams have recently identified cigarette tax evasion schemes involving the accumulation of used cigarette tax stamps. Unlike postage stamps, cigarette stamps are generally not used as collectibles. Used cigarette tax stamps do not have monetary value, except for tax evasion purposes. 

To help prevent cigarette tax evasion, the Governor signed Assembly Bill (AB) 1901 (Stats. 2016, Ch.662) to give the BOE authority to seize and destory any "unaffixed" cigarette tax stamps aggregated to reuse, and makes it a misdemeanor for any person to possess, sell or offer to sell, or buy or offer to buy, any false, fraudulent, or "unaffixed" cigarette tax stamps starting January 1, 2017. 

For purposes of the law, "unaffixed stamps" means cigarette tax stamps which the tax has previously been paid by a Cigarette and Tobacco Products licensed distributor and were previously affixed to cigarette packs. "Unaffixed stamps" do not include any unused and unapplied rolls of stamps or loose stamps acquired from the BOE or its authorized agent and in the possession of a licensed distributor. 

Anyone found with "unaffixed" cigarette tax stamps for reuse purposes is guilty of a misdemeanor, punishable by a fine up to $50,000, or imprisonment (not to exceed one year in a county jail), or by both the fine and imprisionment. 

For more information

Visit the BOE's online Cigarette and Tobacco Products tax guide at: 

www.boe.ca.gov/industry/cigarettes_tobacco_products.html. 

November 26, 2016

Fidel Castro: 1926 - 2016 by Cigar Aficionado

Fidel Castro, who ruled Cuba for decades and was the longtime cigar-smoking symbol of the island nation, died on Friday at the age of 90. His brother Raul announced his death on Cuban television. 

Castro had been in poor health for some time, and had been largely absent from public view. In 2006, he underwent major intestinal surgery and handed over power to younger brother Raul. In October 2012 he was said to have suffered a major stroke. 

In Miami, people took to the streets in the early hours of Saturday morning as news of Castro's death filtered out. Many were shouting "Cuba libre," or "free Cuba."

Fidel Alejandro Castro Ruz was born on his father's sugarcane farm in Biran, an agricultural town in southeastern Cuba located 500 miles from Havana, on August 13, 1926. He studied law at the University of Habana, and became a lawyer, and found himself at odds with Cuba's ruling clas. He founded a Revolutionary movement that culminated in his troop's seizing control of Cuba on New Year's Day 1959, depsing president Fulgencio Batista. 

Castro was initially hailed as a hero by many in the Cuban cigar industry before he led sweeping changes that made Cuba's cigar factories and famous cigar brands property of the Cuban estate. 

"I was in Cuba when Fidel Castro came down from the hills," said Frank Llaneza, the late maker of the Honduran Punch and Hoyo de Monterrey cigar brands, in a 2002 Cigar Aficionado story. "Everyone was very happy. That changed very quickly."

In 1960, Castro's troops nationalized the Cuban cigar industry, seizing factories and fields, and claiming Cuba's cigar brands such as Partagas, Montecristo, H. Upmann and endless others as properties of the state. Cuba would do the same to other industries, resulting in the exodus of many of the country's business owners, who lost their properties and assets to nationalization. 

Castro sparred famously with the United States, which declared a full embargo on Cuban goods (still referred to in Cuba as "el bloqueo,"  or "the blockade") in 1962. The embargo remains in effect, although U.S. President Obama has issued executive orders lessening its effects, including allowing American travellers to return home with Cuban cigars and rum for personal consumption. 

One of the legends about Castro was a CIA plot to kill him with an exploding cigar, as he was nearly always seen in his younger years with a cigar in his mouth. But he said he gave up smoking cigars at the age of 59 during an exclusive interview with Marvin R. Shanken that appeared in the Summer 1994 Cigar Aficionado magazine. 

"The cigar has made our country famous. It has given prestige to our country. Cuba is known among other things for the quality of its cigars," Castro told Shanken during the interview. 

When asked about his love of cigars, Castro said: "I enjoy a cigar because of its aroma, its taste and watching the smoke."

Castro held various titles over the years: prime minister (1959 to 1976), president (1976 to 2008) and first secretary of Cuba's communist party (1961 to 2011). While the names have changed, his rule over the country was considered absolute up until he transferred power to his brother--and many believed he still ran the country after that. 

In 1994, Castro sat down for an extensive interview with Marvin R. Shanken, editor and publisher of Cigar Aficionado magazine. Click here to read the interview. 

Video: Smoking With Castro--Marvin, Fidel And The Cohiba Connection