- 11 - 



Although the number of cigars consumed in recent years has r 

 has not been a corresponding gain in leaf requirements. Betve 

 1958-60 (marketing year basis) there was little change in the total 

 tobacco used for cigars, despite an increase in cigar output 

 sixth. 



Price Line: 



Cigars are sold over a wide range of prices, but for tax purposes, 

 are grouped by the Internal Revenue Service into 7 price classes, accorcLir- 5 

 intended retail price. The current price classes and Federal excise 

 cable to each are as follows: 



Price class Intended Federal tax per 



designation retail price ci^ar 1/ 



Cents ____!_ 



A 2 \ and less .25 



B 2.6 - k.O 



C k.l - 6.0 



D 6.1 - 8.0 



E 8.1 -15.O 1. 



F 15.1 -20.0 l. ; 



G over 20.0 2. 



l/ Actually the tax rate is expressed per 1,000 cigars but is here express- 

 on a per unit basis. 



In i960, of the nearly 7 billion taxable cigars for domestic cons 

 39 percent fell in the k.l to 6 cents class, 3^ percent in the 8.1 tc 

 class, and 17 percent in the 6.1 to 8 cents class. The 3 classes together 

 (k.l to 15 cents) thus accounted for around 90 percent of total taxable 



The increases in consumption in the last 3 years have come pr 

 cigars selling for 8 cents and less . Included in this group are t 

 most of which are priced at k or 5 cents apiece, and lines of establish 

 retailing at 8 cents apiece and less, which have been intrc T 

 facturers in recent years. A substantial decline occurred I selli: 

 8.1 to 15 cents each, while those retailing at over 15 cents each gad 

 ately. This is shown by the following: 



- .- , -, - ' • - 



6 cents or less 

 Cigarillos 



Cigars + 



6.1 - 8.0 cents +5: 



Subtotal, 8 cents 

 or less 

 8.1 - 15.O cents 



Over 15 ceirl + 



^RAND TOTAL 



