Pennsylvania 2023-2024 Regular Session

Pennsylvania Senate Bill SB837

Introduced

7/6/23

Refer

7/6/23

Caption

In cigarette sales and licensing, further providing for definitions and providing for presumed cost of doing business by retailer.

Impact

By implementing this presumed cost model, SB 837 would standardize the financial parameters for retailers throughout Pennsylvania. This means that, unless a retailer can prove their costs are lower, they will be required to use the established percentages when determining their retail pricing. This change may affect pricing strategies and the overall market dynamics for cigarette sales in the state. It aims to balance the interests of consumers, by potentially stabilizing prices, against the operational realities faced by retailers in a highly regulated market.

Summary

Senate Bill 837 seeks to amend The Fiscal Code of Pennsylvania, specifically in regard to the definition and calculation of the 'cost of doing business' for retailers engaged in cigarette sales. The bill introduces a presumed cost structure, wherein retailers would have a baseline cost percentage applied to the basic price of cigarettes they purchase. Initially set at 9% for the latter half of 2023, this presumed cost will increase incrementally, rising to 12% by 2026. This approach is intended to provide clarity and consistency in how cigarette retailers calculate their costs and would potentially simplify compliance with state regulations.

Sentiment

The sentiment around SB 837 is mixed. Supporters, including some legislators, view the bill as a necessary adjustment to bring consistency in cigarette sales regulation, which they argue will help retailers manage their operations more effectively. Conversely, there are concerns from some consumer advocacy groups about potential implications for pricing and access to cigarettes, particularly in lower-income communities where cost sensitivity is a significant factor. Overall, the bill has ignited discussions on regulatory efficiency versus market freedom in retailing tobacco products.

Contention

One notable point of contention regarding SB 837 revolves around the effective date and increment of the presumed cost increase. Critics argue that while the presumed cost provides a straightforward framework for compliance, it may not accurately reflect the operational costs of all retailers and could lead to increased retail prices over time, impacting consumers. Additionally, there is ongoing debate about whether the state is appropriately balancing public health concerns associated with tobacco consumption against the economic realities of retailers who operate in a market with ever-tightening margins.

Latest SB837 Activity

Companion Bills

No companion bills found.

Previously Filed As

PA SB773

In cigarette sales and licensing, further providing for definitions and providing for presumed cost of doing business by retailer.

PA SB2312

Unfair Cigarette Sales Law; increase the presumptions of the cost of doing business and cartage cost by a wholesale dealer.

PA HB1425

In tobacco products tax, further providing for definitions, for incidence and rate of tax, for licensing of wholesalers and for licensing of retailers and providing for electronic nicotine delivery system directory.

PA SB3124

Tobacco/ENDS; impose ENDS excise tax, and increase other tobacco excise taxes and presumed costs of doing business.

PA HB1138

In sales and use tax, further providing for definitions and for imposition of tax; and, in gross receipts tax, further providing for imposition of tax.

PA HB829

In preliminary provisions, further providing for definitions;

PA SB654

In sales and use tax, further providing for

PA HB1300

In emergency COVID-19 response, providing for

PA HB164

In sales and use tax, further providing for definitions, for imposition of tax and for exclusions from tax; and, in gross receipts tax, further providing for imposition of tax.

PA HB2559

In damages by action at law, further providing for recovery; in liability and compensation, further providing for schedule of compensation, repealing provisions relating to computation of benefits and providing for computation of benefits; in procedure, further providing for compromise and release, for collective bargaining agreement and for workers' compensation insurance; in additional coverages, further providing for irrebuttable presumption; in Self-Insurance Guaranty Fund, further providing for definitions and for prefund account; and, in Uninsured Employers Guaranty Fund, further providing for definitions.