Omaha City Council Holds Hearing on 7% Tobacco Product Occupation Tax

Published in Tobacco E-News

By  Thomas A. Briant, Executive Director

On Tuesday, September 25, the Omaha City Council held a public hearing on a proposed ordinance that would adopt an "occupational privilege tax" on tobacco retailers that will equal 7% of the gross receipts from the "sale of tobacco products and any pipe or other device intended for use in consuming tobacco products." The ordinance defines tobacco products as cigarettes, cigars, roll-your-own tobacco, snuff, chewing tobacco, any nicotine delivery device providing for the ingestion of nicotine into the body, and anything containing tobacco suitable for chewing, smoking in a pipe, or inhaling.

Just prior to the public hearing, the city council's Finance Committee met and determined that the occupation tax should be 4.5%, not 7%. At the opening of the city council's public hearing, an announcement was made regarding this reduction in the occupation tax rate.

NATO worked to mobilize retailers in Omaha to oppose the tax and coordinated efforts with numerous other trade organizations. More than 20 retailers and members of these other trade groups testified in opposition to the new tax at the September 25 city council hearing.

The proposed occupational tax would be earmarked to raise revenue to support city government functions, including dedicating $35 million over a 10-year period to help fund the building of a $370 million cancer center at the University of Nebraska located in Omaha.

The Omaha City Council is scheduled to meet again today, Tuesday, October 2, when a vote on the proposal is expected by the full city council.