RYO Legislation Moves Closer to President's Desk

WASHINGTON, D.C. -- The bill requiring roll-your-own (RYO) businesses to pay the same taxes as major cigarette and tobacco companies is one step closer to being in the books. The measure is included as an amendment to the Transportation Bill passed by both houses of Congress late last week.

On Friday, June 29, President Obama signed a temporary extension of the Transportation Bill to give time for the full legislation to reach his desk, according to the Associated Press. He is expected to sign the full law in the next few days.

RYO retailing allows a consumer to buy cigarette paper and loose tobacco to roll their own cigarettes, but only pay tax on the cigarette paper and loose tobacco.

This past spring, a coalition of more than 80 national and state associations and retail stores successfully lobbied Sen. Max Baucus (D-Mont.) to place RYO language in the Senate Transportation Bill that passed on March 14. Specifically, the proposed legislation calls for expanding the definition of a tobacco manufacturer to include businesses operating a RYO machine. As such, the operator would be liable for federal excise taxes on the tobacco products manufacturer, as CSNews Online previously reported.

Coalition members urged support of efforts to close a loophole in the Internal Revenue Code. The coalition included industry heavyweights such as NACS, the Association for Convenience and Fuels Retailing, the American Wholesale Marketers Association, National Association of Tobacco Outlets, Petroleum Marketers Association of America, 7-Eleven Inc., Cumberland Farms, Kum and Go, Kwik Trip and Valero Retail Holdings.