QUITS Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 4425 To increase the taxes on certain tobacco products, to prohibit the flavoring of certain tobacco products, and for other purposes. IN THE HOUSE OF REPRESENTATIVES SEPTEMBER 19, 2019 Mr. SUOZZI (for himself, Mr. KING of New York, Mr. COHEN, Mr. PANETTA, Mr. KRISHNAMOORTHI, and Mr. CICILLINE) introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subse- quently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To increase the taxes on certain tobacco products, to prohibit the flavoring of certain tobacco products, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Quell Underage Inhal- 4 ing of Toxic Substances Act of 2019’’ or as the ‘‘QUITS 5 Act of 2019’’. 6 VerDate Sep 11 2014 21:04 Sep 23, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H4425.IH H4425 pamtmann on DSKBC07HB2PROD with BILLS 2 •HR 4425 IH SEC. 2. INCREASE IN TAX ON CERTAIN TOBACCO PROD- 1 UCTS. 2 (a) INCREASING TAX ON CIGARETTES.— 3 (1) SMALL CIGARETTES.—Section 5701(b)(1) 4 of the Internal Revenue Code of 1986 is amended by 5 striking ‘‘$50.33’’ and inserting ‘‘$150’’. 6 (2) LARGE CIGARETTES.—Section 5701(b)(2) 7 of such Code is amended by striking ‘‘$105.69’’ and 8 inserting ‘‘$314.99’’. 9 (b) TAX PARITY FOR SMALL CIGARS.—Paragraph 10 (1) of section 5701(a) of the Internal Revenue Code of 11 1986 is amended by striking ‘‘$50.33’’ and inserting 12 ‘‘$150’’. 13 (c) TAX PARITY FOR LARGE CIGARS.— 14 (1) IN GENERAL.—Paragraph (2) of section 15 5701(a) of the Internal Revenue Code of 1986 is 16 amended by striking ‘‘52.75 percent’’ and all that 17 follows through the period and inserting ‘‘$73.85 per 18 pound and a proportionate tax at the like rate on all 19 fractional parts of a pound but not less than 15 20 cents per cigar.’’. 21 (2) GUIDANCE.—The Secretary of the Treas- 22 ury, or the Secretary’s delegate, may issue guidance 23 regarding the appropriate method for determining 24 the weight of large cigars for purposes of calculating 25 VerDate Sep 11 2014 21:04 Sep 23, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H4425.IH H4425 pamtmann on DSKBC07HB2PROD with BILLS 3 •HR 4425 IH the applicable tax under section 5701(a)(2) of the 1 Internal Revenue Code of 1986. 2 (d) TAX PARITY FOR SMOKELESS TOBACCO.— 3 (1) Section 5701(e) of the Internal Revenue 4 Code of 1986 is amended— 5 (A) in paragraph (1), by striking ‘‘$1.51’’ 6 and inserting ‘‘$40’’, 7 (B) in paragraph (2), by striking ‘‘50.33 8 cents’’ and inserting ‘‘$16’’, and 9 (C) by adding at the end the following new 10 paragraph: 11 ‘‘(3) SMOKELESS TOBACCO SOLD IN DISCRETE 12 SINGLE-USE UNITS.—On discrete single-use units, 13 $150 per thousand.’’. 14 (2) Section 5702(m) of such Code is amend- 15 ed— 16 (A) in paragraph (1), by striking ‘‘or chew- 17 ing tobacco’’ and inserting ‘‘, chewing tobacco, 18 or discrete single-use unit’’, 19 (B) in paragraphs (2) and (3), by inserting 20 ‘‘that is not a discrete single-use unit’’ before 21 the period at the end of each such paragraph, 22 and 23 (C) by adding at the end the following new 24 paragraph: 25 VerDate Sep 11 2014 21:04 Sep 23, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4425.IH H4425 pamtmann on DSKBC07HB2PROD with BILLS 4 •HR 4425 IH ‘‘(4) DISCRETE SINGLE-USE UNIT.—The term 1 ‘discrete single-use unit’ means any product con- 2 taining tobacco that— 3 ‘‘(A) is not intended to be smoked, and 4 ‘‘(B) is in the form of a lozenge, tablet, 5 pill, pouch, dissolvable strip, or other discrete 6 single-use or single-dose unit.’’. 7 (e) TAX PARITY FOR PIPE TOBACCO.—Section 8 5701(f) of the Internal Revenue Code of 1986 is amended 9 by striking ‘‘$2.8311 cents’’ and inserting ‘‘$73.85’’. 10 (f) TAX PARITY FOR ROLL-YOUR-OWN TOBACCO.— 11 Section 5701(g) of the Internal Revenue Code of 1986 is 12 amended by striking ‘‘$24.78’’ and inserting ‘‘$73.85’’. 13 (g) TAX PARITY FOR ROLL-YOUR-OWN TOBACCO 14 AND CERTAIN PROCESSED TOBACCO.—Subsection (o) of 15 section 5702 of the Internal Revenue Code of 1986 is 16 amended by inserting ‘‘, and includes processed tobacco 17 that is removed for delivery or delivered to a person other 18 than a person with a permit provided under section 5713, 19 but does not include removals of processed tobacco for ex- 20 portation’’ after ‘‘wrappers thereof’’. 21 (h) CLARIFYING TAX RATE FOR OTHER TOBACCO 22 PRODUCTS.— 23 VerDate Sep 11 2014 21:04 Sep 23, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4425.IH H4425 pamtmann on DSKBC07HB2PROD with BILLS 5 •HR 4425 IH (1) IN GENERAL.—Section 5701 of the Internal 1 Revenue Code of 1986 is amended by adding at the 2 end the following new subsection: 3 ‘‘(i) OTHER TOBACCO PRODUCTS.—Any product not 4 otherwise described under this section that has been deter- 5 mined to be a tobacco product by the Food and Drug Ad- 6 ministration through its authorities under the Family 7 Smoking Prevention and Tobacco Control Act shall be 8 taxed at a level of tax equivalent to the tax rate for ciga- 9 rettes on an estimated per use basis as determined by the 10 Secretary.’’. 11 (2) ESTABLISHING PER USE BASIS.—For pur- 12 poses of section 5701(i) of the Internal Revenue 13 Code of 1986, not later than 12 months after the 14 later of the date of the enactment of this Act or the 15 date that a product has been determined to be a to- 16 bacco product by the Food and Drug Administra- 17 tion, the Secretary of the Treasury (or the Secretary 18 of the Treasury’s delegate) shall issue final regula- 19 tions establishing the level of tax for such product 20 that is equivalent to the tax rate for cigarettes on 21 an estimated per use basis. 22 (i) CLARIFYING DEFINITION OF TOBACCO PROD- 23 UCTS.— 24 VerDate Sep 11 2014 21:04 Sep 23, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H4425.IH H4425 pamtmann on DSKBC07HB2PROD with BILLS 6 •HR 4425 IH (1) IN GENERAL.—Subsection (c) of section 1 5702 of the Internal Revenue Code of 1986 is 2 amended to read as follows: 3 ‘‘(c) TOBACCO PRODUCTS.—The term ‘tobacco prod- 4 ucts’ means— 5 ‘‘(1) cigars, cigarettes, smokeless tobacco, pipe 6 tobacco, and roll-your-own tobacco, and 7 ‘‘(2) any other product subject to tax pursuant 8 to section 5701(i).’’. 9 (2) CONFORMING AMENDMENTS.—Subsection 10 (d) of section 5702 of such Code is amended by 11 striking ‘‘cigars, cigarettes, smokeless tobacco, pipe 12 tobacco, or roll-your-own tobacco’’ each place it ap- 13 pears and inserting ‘‘tobacco products’’. 14 (j) TAX RATES ADJUSTED FOR INFLATION.—Section 15 5701 of such Code, as amended by subsection (g), is 16 amended by adding at the end the following new sub- 17 section: 18 ‘‘(j) INFLATION ADJUSTMENT.— 19 ‘‘(1) IN GENERAL.—In the case of any calendar 20 year beginning after 2019, each dollar amount con- 21 tained in this section shall be increased by an 22 amount equal to— 23 ‘‘(A) such dollar amount, multiplied by 24 VerDate Sep 11 2014 21:04 Sep 23, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H4425.IH H4425 pamtmann on DSKBC07HB2PROD with BILLS 7 •HR 4425 IH ‘‘(B) the cost-of-living adjustment deter- 1 mined under section 1(f)(3) for the calendar 2 year, determined by substituting ‘calendar year 3 2018’ for ‘calendar year 2016’ in subparagraph 4 (A)(ii) thereof. 5 ‘‘(2) ROUNDING.—If any amount as adjusted 6 under paragraph (1) is not a multiple of $0.01, such 7 amount shall be rounded to the next highest multiple 8 of $0.01’’. 9 (k) FLOOR STOCKS TAXES.— 10 (1) IMPOSITION OF TAX.—On tobacco products 11 manufactured in or imported into the United States 12 which are removed before the tax increase date and 13 held on such date for sale by any person, there is 14 hereby imposed a tax in an amount equal to the ex- 15 cess of— 16 (A) the tax which would be imposed under 17 section 5701 of the Internal Revenue Code of 18 1986 on the article if the article had been re- 19 moved on such date, over 20 (B) the prior tax (if any) imposed under 21 section 5701 of such Code on such article. 22 (2) TAX INCREASE DATE.—For purposes of this 23 subsection, the term ‘‘tax increase date’’ means the 24 day after the date of the enactment of this Act. 25 VerDate Sep 11 2014 21:04 Sep 23, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H4425.IH H4425 pamtmann on DSKBC07HB2PROD with BILLS 8 •HR 4425 IH (l) EFFECTIVE DATE.—The amendments made by 1 this section shall apply to articles removed after the date 2 of the enactment of this Act. 3 SEC. 3. PROHIBITING FLAVORING OF TOBACCO PRODUCTS. 4 (a) PROHIBITION.—Subparagraph (A) of section 5 907(a)(1) of the Federal Food, Drug, and Cosmetic Act 6 (21 U.S.C. 387g(a)(1)) is amended to read as follows: 7 ‘‘(A) SPECIAL RULE.—Beginning on the 8 date that is 1 year after the date of enactment 9 of the Quell Underage Inhaling of Toxic Sub- 10 stances Act of 2019, except as provided in sub- 11 paragraph (C), a tobacco product or any of its 12 component parts or accessories (including the 13 tobacco, filter, or paper) shall not contain, as a 14 constituent (including a smoke constituent) or 15 additive, an artificial or natural flavor (other 16 than tobacco) that is a characterizing flavor of 17 the tobacco product or tobacco smoke or an 18 herb or spice, including menthol, mint, straw- 19 berry, grape, orange, clove, cinnamon, pine- 20 apple, vanilla, coconut, licorice, cocoa, chocolate, 21 cherry, or coffee. Nothing in this subparagraph 22 shall be construed to limit the Secretary’s au- 23 thority to take action under this section or 24 VerDate Sep 11 2014 21:04 Sep 23, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H4425.IH H4425 pamtmann on DSKBC07HB2PROD with BILLS 9 •HR 4425 IH other sections of this Act applicable to any arti- 1 ficial or natural flavor, herb, or spice.’’. 2 (b) EXCEPTION.—Paragraph (1) of section 907(a) of 3 the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 4 387g(a)) is amended by adding at the end the following 5 new subparagraph: 6 ‘‘(C) EXCEPTION FOR CHARACTERIZING 7 FLAVORS TO DECREASE SMOKING.—Notwith- 8 standing subparagraph (A), an electronic nico- 9 tine delivery system product or any component 10 or part of such a product may contain, as a 11 constituent (including a smoke constituent) or 12 additive, an artificial or natural flavor or an 13 herb or spice, that is a characterizing flavor of 14 the tobacco product or tobacco smoke so long as 15 the Secretary, in coordination with the Commis- 16 sioner of Food and Drugs, determines that such 17 characterizing flavor will be appropriate for the 18 protection of public health because it— 19 ‘‘(i) will significantly increase the like- 20 lihood of smoking cessation among current 21 users of tobacco products; 22 ‘‘(ii) will not increase the likelihood 23 that individuals who do not use tobacco 24 VerDate Sep 11 2014 21:04 Sep 23, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H4425.IH H4425 pamtmann on DSKBC07HB2PROD with BILLS 10 •HR 4425 IH products, including youth, will start using 1 such products; and 2 ‘‘(iii) will not increase the likelihood of 3 harm to the person using the product.’’. 4 (c) SAVINGS PROVISION.—Section 907(a)(1) of the 5 Federal Food, Drug, and Cosmetic Act (21 U.S.C. 6 387g(a)(1)), as in effect on the date of enactment of this 7 Act, shall remain in effect until the amendments made to 8 such section 907(a)(1) by this section take effect. 9 SEC. 4. INCREASE IN AUTHORIZATION OF APPROPRIA- 10 TIONS FOR OFFICE OF SMOKING AND 11 HEALTH OF THE CENTERS FOR DISEASE CON- 12 TROL AND PREVENTION. 13 There is hereby authorized to be appropriated to 14 carry out the programs of the Office of Smoking and 15 Health of the Centers for Disease Control and Prevention 16 $500,000,000 in each fiscal year. 17 Æ VerDate Sep 11 2014 21:04 Sep 23, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6301 E:\BILLS\H4425.IH H4425 pamtmann on DSKBC07HB2PROD with BILLS