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Governor Felix Camacho Friday signed bill 150 into law.

It will raise the current $1 dollar tax on a pack of cigarettes to $3 dollars. The higher tax taxes effect in 60 days, the first week of April.

Cigars will be taxed at .40 cents per mini cigar, .44 cents per regular sized cigar, and .50 cents per large cigar. Chewing tobacco will also cost an additional dollar per can.

Vice-Speaker BJ Cruz was the author of this legislation.He says that he knew it would make people upset but it was a piece of legislation that he had to push through when he heard that there is one diagnosis of lung cancer per week on Guam.

“This is a very important piece of legislation because it greatly supports with our attempt to discourage tobacco usage in our community,” said Governor Camacho. “Lt. Governor Cruz and I pledge to continue supporting all efforts that provide for a healthier quality of life for our people.”

“I want to commend Governor Camacho and members of the Legislature for ensuring that this became law,” said Lt. Governor Cruz. “This will help us decrease tobacco usage among our people, but more importantly, it will reduce the number of tobacco-related health issues we would otherwise have to address in the future.”

According to PL 30-80, a significant amount of revenue generated from the tax increase will be deposited into the newly created Guam Cancer Trust Fund to be used by programs that support cancer screenings, treatment, and support services.

Additionally, tax revenues will go to GMH, DPHSS, and DMHSA to support disease prevention programs and address future healthcare demands associated with tobacco use.

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From The Tax Girl:
Despite the Obama administration’s efforts to close the gap between decreasing revenues and increasing expenditures, the federal deficit is expected to soar this year. Congress has been scrambling for ways to find extra dollars and one Congressman believes he’s found a way: tax online music.

It’s no wonder. The number of songs sold online is exploding; early in the year, Apple announced that it had sold more than 6 billion songs on iTunes. Most iTunes are sold for 99 cents each.

The federal proposal would impose a penny tax on all downloaded music in or originating from the US. Ostensibly, this would include all iTunes music since the company is based out of Cupertino, California.

After advising his colleagues to “do the math” (and summoning a page with a calculator), the Congressman noted that, on iTunes music alone, the penny tax would have raised $60 million, roughly the cost of 3 hours worth of funding to AIG (assuming $170 billion bailout over the course of one year).

There was immediate reaction from the music industry, claiming that a tax on music had the potential to suppress sales, including songs with actual merit. As a result of those concerns, an exemption from the tax has been proposed for performers which could prove that either their lyrics or original musical compositions provided “substantial and irreplaceable contributions to the music or art world.”

Performers Britney Spears and Mariah Carey immediately issued statements that they would not seek an exemption. Spears, speaking from her car, said, “I’m just country, y’all. I never meant to do art.” Congress agreed.

Bono, responding to the news, was certain that this was another way that the revenues from his music would avoid taxation. “Wow,” he reacted. “We didn’t even have to move to the Netherlands for this one.” The popular lead singer of the band U2 has faced criticism in recent years for his decision to move the band from Ireland to the Netherlands to avoid paying taxes (he claims that he did it just for the cheese).

Pop icons didn’t rule the day, however. Sen. Robert Byrd (D-WV) proposed an amendment to the bill which would exempt bluegrass and other folk music from the tax. Holding up his own album, US Senator Robert Byrd: Mountain Fiddler (County, 1978), as an example (I’m not making that up - Google it), Byrd noted that there are some classes of “the people’s music” which are in danger of disappearing. Adding a penny tax to tunes downloaded onto an already expensive iPod could make the music unaffordable, he argued. Senators, who remember (perhaps fondly) Byrd occasionally picking up a fiddle in the chambers were sympathetic to his case, but otherwise unmoved.

Noted Sen. Arlen Specter (R-PA), exempting bluegrass music could lead the Senate down the slippery slope of having to carve out other exceptions. He said, “If we exempt one class of music, we’d have to exempt others,” pointing out that the Pennsylvania Polka would not have been saved under Sen. Byrd’s exemption. Specter was immediately criticized by conservatives by invoking a song with the lyrics “Gay with laughter happy as can be, They stop to have a beer.”

Sen. Jim DeMint (R-SC) argued that the bill didn’t go far enough. Taking the floor, he denounced online music as just adding to the entire immoral culture of rock and roll, saying:

“Even if this was not a law… I’m afraid I would have a lot of difficulty endorsing an enterprise which is as fraught with genuine peril as I believe this one to be. Besides the liquor and the drugs which always seem to accompany such an event the thing that distresses me even more… is the spiritual corruption that can be involved. These dances and this kind of music can be destructive, and, uh,… I’m afraid you’re going to find most of the people in our community are gonna agree with me on this.”

Sen. Evan Bayh (D-IN) stopped DeMint before he could go much further, calling him out for quoting the big Reverend Shaw Moore scene from the movie “Footloose.”

Of course, it was not unexpected that Apple voiced one of the loudest objections to the bill, claiming the company was being unfairly targeted simply for being cool. The company also noted that the penny tax would boost the cost of most iTunes to an even dollar, creating a serious shortage in the virtual “take a penny, leave a penny” jar.

Despite the controversy surrounding the bill, a vote is expected to take place later today, on April 1st, otherwise known as April Fool’s Day. Happy April Fool’s Day!

The city of Nashua has had it’s tax rate increased by less than 1 percent, the mayor announced Wednesday, and one alderman said it couldn’t have come at a better time.

“This is one of our smallest increases over the last 10 years,” Mayor Donnalee Lozeau said. “I hope this provides some comfort for our residents in these uncertain times.”

Lozeau announced the tax rate during her remarks at the beginning of the board of aldermen’s meeting. The state Department of Revenue Administration sets the tax rate based on financial information provided by the city.

The new rate is $17.55 per $1,000 of assessed property value. It marks an increase of 15 cents, or 0.8 percent, over the current tax rate.

With the new rate, the owner of a home assessed at $250,000 would pay $4,387.50 in city property taxes this fiscal year, or $37.50 more than last year.
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