Tobacco tax hike puts damper on Florida cigar makers

MIAMI (AP) - Florida's cigar makers are worried about a new
federal tobacco tax that threatens the state's $2 billion cigar
industry.

Starting Wednesday, the tax will increase from 5 cents to about
40 cents on large cigars, a little less on smaller stogies.

Cigar makers say the increase will torch jobs and profits -
what's left of them in the recession.

The revenue from the new tax will help pay for a health
insurance program for low-income children that President Barack
Obama signed into law about two months ago.

The State Children's Health Insurance Program, or SCHIP, will extend coverage to 11 million kids.

Florida has long been the hub of U.S. cigar making.


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