A BILL TO BE ENTITLED
AN ACT to raise the excise TAXES on cigarettes and other tobacco products to reduce and prevent youth smoking in North Carolina and thereby protect the health and save the lives of North Carolina's children.
Whereas, North Carolina's excise tax on cigarettes is currently five cents (5¢) a pack, the third lowest in the nation, and
Whereas, the use of tobacco products is the leading cause of preventable death and disability in North Carolina, and
Whereas, the use of tobacco products costs the State four billion seven hundred fifty million dollars ($4,750,000,000) in medical costs and lost productivity annually, and
Whereas, 24,600 North Carolina children become new daily smokers each year, a rate of 67 new daily child smokers everyday, and
Whereas, the best way to prevent and reduce tobacco use by children is to substantially increase the cost of cigarettes, and
Whereas such a tax increase would result in a sixteen and one-tenths percent (16.1%) decrease in youth smoking rates, prevent 105,750 North Carolina children from starting to smoke, and save 33,750 North Carolina children from premature smoking‑related deaths; Now, therefore,
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 105‑113.5 reads as rewritten:
"§ 105‑113.5.  Tax on cigarettes.
A tax is levied on the sale or possession for sale in this State, by a distributor, of all cigarettes at the rate of three and three-quarter cents (3 3/4¢) per individual cigarette.
This tax does not apply to any of the following:
(1)	Sample cigarettes distributed without charge in packages containing five or fewer cigarettes.
(2)	Cigarettes in a package of cigarettes given without charge by the manufacturer of the cigarettes to an employee of the manufacturer who works in a factory where cigarettes are made, if the cigarettes are not taxed by the federal government."
SECTION 2.  G.S. 105‑113.35(a) reads as rewritten:
"(a)	Tax. – An excise tax is levied on tobacco products other than cigarettes at the rate of thirty percent (30%) of the cost price of the products. This tax does not apply to the following:
(1)	A tobacco product sold outside the State.
(2)	A tobacco product sold to the federal government.
(3)	A sample tobacco product distributed without charge."
SECTION 3.  This act becomes effective July 1, 2003.