To amend the Internal Revenue Code of 1986 to increase the excise tax on smokeless tobacco, and for other purposes.

Amends the Internal Revenue Code to increase the excise tax on smokeless tobacco from: (1) 24 cents to $1.20 per pound for snuff; and (2) eight cents to 40 cents per pound for chewing tobacco.

Establishes in the Treasury the Tobacco-Related Disease Research Trust Fund, to be available to finance research by the National Cancer Institute on cancer and other lung diseases related to tobacco products. Appropriates to the Trust Fund amounts equal to the revenue raised by the excise tax imposed on smokeless tobacco.

 
HR 154 IH
101st CONGRESS
1st Session
 H. R. 154
To amend the Internal Revenue Code of 1986 to increase the excise tax on
smokeless tobacco, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
January 3, 1989
Mr. DONNELLY introduced the following bill; which was referred to the
Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to increase the excise tax on
smokeless tobacco, and for other purposes.
  Be it enacted by the Senate and House of Representatives of the United
  States of America in Congress assembled,
SECTION 1. INCREASE IN FEDERAL EXCISE TAX ON SMOKELESS TOBACCO.
  (a) IN GENERAL- Subsection (e) of section 5701 of the Internal Revenue Code
  of 1986 (relating to imposition of tax on smokeless tobacco) is amended--
  (1) by striking out `24 cents' in paragraph (1) and inserting in lieu
  thereof `$1.20'.
  (2) by striking out `8 cents' in paragraph (2) and inserting in lieu thereof
  `40 cents'.
  (b) Floor Stocks-
  (1) IMPOSITION OF TAX- On smokeless tobacco manufactured in or imported
  into the United States which is removed before October 1, 1989, and held on
  such date for sale by any person, there shall be imposed the following taxes:
  (A) SNUFF- On snuff, 96 cents per pound and a proportionate tax at the
  like rate on all fractional parts of a pound.
  (B) CHEWING TOBACCO- On chewing tobacco, 32 cents per pound and a
  proportionate tax at the like rate on all fractional parts of a pound.
  (2) Liability for tax and method of payment-
  (A) LIABILITY FOR TAX- A person holding smokeless tobacco on October 1,
  1989, to which any tax imposed by paragraph (1) applies shall be liable
  for such tax.
  (B) METHOD OF PAYMENT- The tax imposed by paragraph (1) shall be treated as
  a tax imposed under section 5701 of the Internal Revenue Code of 1986 and
  shall be due and payable on November 17, 1989, in the same manner as the
  tax imposed under such section is payable with respect to tobacco removed
  on October 1, 1989.
  (3) SNUFF AND CHEWING TOBACCO- For purposes of this subsection, the terms,
  `snuff' and `chewing tobacco' shall have the same meaning given to such
  terms by paragraphs (2) and (3) of subsection (n) of section 5702 of the
  Internal Revenue Code of 1986, respectively.
  (4) EXCEPTION FOR RETAILERS- The taxes imposed by paragraph (1) shall not
  apply to the snuff and chewing tobacco in retail stocks held on October 1,
  1989, at the place where intended to be sold at retail.
  (c) EFFECTIVE DATE- The amendments made by subsection (a) shall apply to
  chewing tobacco or snuff removed after September 30, 1989.
SEC. 2. TRANSFER OF REVENUES TO TOBACCO-RELATED DISEASE RESEARCH TRUST FUND.
  (a) Transfer of Revenue From Smokeless Tobacco Excise Taxes to Trust Fund
  for Tobacco-Related Disease Research-
  (1) IN GENERAL- Subchapter A of chapter 98 of the Internal Revenue Code of
  1986 (relating to Trust Fund Code) is amended by adding at the end thereof
  the following new section:
`SEC. 9510. TOBACCO-RELATED DISEASE RESEARCH TRUST FUND.
  `(a) CREATION OF TRUST FUND- There is hereby established in the Treasury of
  the United States a trust fund to be known as the `Tobacco-Related Disease
  Research Trust Fund', consisting of such amounts as may be appropriated
  or credited to the Tobacco-Related Disease Research Trust Fund as provided
  in this section or section 9602(b).
  `(b) TRANSFER TO TRUST FUND ALL EXCISE TAXES IMPOSED ON SMOKELESS TOBACCO-
  There is hereby appropriated to the Tobacco-Related Disease Research Trust
  Fund amounts equivalent to all of the taxes received in the Treasury under
  section 5701(e). For purposes of this section, the term `smokeless tobacco'
  has the same meaning given to such term by paragraph (1) of subsection
  (n) of section 5702.
  `(c) EXPENDITURES FROM RESEARCH TRUST FUND- Amounts in the Tobacco-Related
  Disease Research Trust Fund shall be available, as provided by appropriation
  Acts, to carry out research by the National Cancer Institute on cancer
  and other lung diseases related to the use of tobacco products.'
  (1) CLERICAL AMENDMENT- The table of sections for subchapter A is amended
  by adding at the end thereof the following new item:
`Sec. 9510. Tobacco-Related Disease Research Trust Fund.'