Update On PA Legislative Proposal To Increase Minimum Margin On Cigarette Sales


The Pennsylvania General Assembly continues to work to finish the 2024 FY state budget. As part of that process, the state House recently sent a fiscal code bill (HB 1300) to the Senate. Fiscal code bills contain multiple spending authorizations of various programs in state government.

The House amended into HB 1300 a change in the Unfair Cigarette Sales Act that would result in a significant increase of revenue for retailers as defined in the act.  Under the bill, the definition of “cost to the retailer” would result in an increase in the minimum markup in stages over the next few years. This legislation was originally introduced in the Senate as SB 837 (click here for more information).

The scheduled increase in the language in the bill is as follows:

Section 234-A.  Presumed Cost of Doing Business By Retailer.–The presumed cost of doing business by a retailer making the sale shall be the following per centum:

  1. Prior to January 1, 2024, seven per centum.
  2. Beginning January 1, 2024, through December 31, 2024, nine per centum.
  3. Beginning January 1, 2025, through December 31, 2025, ten per centum.
  4. Beginning January 1, 2026, eleven per centum.
  5. Beginning January 1, 2027, and thereafter, twelve per centum.

Section 235-A.  Presumed Cost of Doing Business By Stamping Agent.–The presumed cost of doing business by a stamping agent making the sale shall be the following per centum:

  1. Prior to January 1, 2024, one and seven tenths per centum.
  2. Beginning January 1, 2024, through December 31, 2024, two per centum.
  3. January 1, 2025, and thereafter, two and one-half per centum.

Section 236-A.  Presumed Cost of Doing Business By Wholesaler.–The presumed cost of doing business by a wholesaler making the sale shall be the following per centum:

  1. Prior to January 1, 2024, four per centum.
  2. Beginning January 1, 2024, through December 31, 2024, six per centum.
  3. Beginning January 1, 2025, and thereafter, seven per centum.

If this legislation is important to your business or your dealers business please use the FOLLOWING FORM to contact your local House member in support of including the verbiage in the passage of HB 1300.