On Thursday, the House of Representatives voted to extend and expand the SCHIP bill.  The tax on large cigars will include a 750% tax hike.   The wholesale price is being increased from 5 to 40 cents, a  52.4% tax increase.  As unfortunate as it is, this is far lower than the original proposal from the Senate of $10 per cigar and $3 proposed by the House.

Here is an excerpt:

SCHIP Legislation Details

The new tax rates are effective April 1, 2009;

The cigarette tax rate goes from $.39 per pack to $1.00 per pack;
The tax on snuff goes from $.585 per pound to $1.50 per pound;
The tax on pipe tobacco goes from $1.0969 per pound to $2.8126 per pound;
The tax on RYO goes from $1.0969 per pound to $24.62 per pound (not a typo).

Additionally the definition of RYO has been expanded to include cigar wrappers to address the “blunt wraps” issue;
The tax change to small cigars (cigars weighing less the three (3) pounds per thousand will be phased in over five (5) years at the following rates per year:
2009 & 2010 – $.25 per pack
2011 & 2012 – $.50 per pack
2013 & 2014 – $.75 per pack
2015 and beyond – $1.00 per pack

If you wish to read the Tax portion of the SCHIP bill, click here.
If you wish to read the Full SCHIP bill, click here.