Due to the increasing number of tobacco tax related bills introduced in recent sessions of the General Assembly, the House Finance Committee formed the Tobacco & Cigarette Tax subcommittee to thoroughly study the tobacco tax area. The area of study included not only the State and local tax rate questions but also, the tobacco industry in Virginia, the role of the tobacco tax in the State and local revenue structure, the relationship of State and local taxes, the localities' ability to impose a local cigarette tax, the administration of the tax, bootlegging problems in Virginia and finally the penalties for illegal possession or transportation of improperly taxed cigarettes. Because of the detailed nature of the study the House Finance Committee agreed to delay action on all tobacco tax related bills in the 1977 Session while awaiting the findings, conclusions and recommendations of this subcommittee.

In addition to legislators from the House Finance and Senate Finance Committees the subcommittee included a number of representatives from various segments of the tobacco industry and representatives of the community as well. The following delegates were appointed to serve on the subcommittee: Delegate Bernard G. Barrow, Chairman; Delegate Joseph A. Leafe; Delegate Lewis W. Parker, Jr.; Delegate Robert E. Quinn; and Delegate Erwin S. Solomon. Members appointed from the Senate Finance Committee included the following:· Senator Howard P. Anderson; Senator William A. Truban; Senator Edward E. Willey. The following citizen members were also appointed to serve on the subcommittee: Richard L. DeCair, Richmond; Jack W. Garrett, Danville; Alex Hamilton, Richmond; Charles P. Inman, Richmond; Margaret Jones, Charlottesville; Wallace A. Mergler, Richmond; Page H. Sutherland, Richmond; and W. Bruce Wingo, Richmond.

On January 23, 1978, the House Finance Committee accepted this report and ordered that it be printed and distributed.

The subcommittee was assisted in its study by the staff of the Virginia Division of Legislative Services. Specific staff assigned to the subcommittee were: E. M. Miller, Jr., Staff Attorney; John A. Garka, Economist; Jill M. Pope, Legislative Research Associate; and William L. Higgs, Student Research Associate.