A bill that would have exempted Subsequent Participating Manufacturers (SPMs) to the Master Settlement Agreement from Mississippi’s so-called “equity tax” or “nonsettling manufacturers fee” has died in committee.
Mississippi is one of four states that are not signatories to the MSA, having settled separately with the major tobacco companies. Of the four non-signatories, Mississippi and Minnesota have enacted separate “equity fees” applicable to non-signatories, which require the non-signatories to make payments similar to the major tobacco companies’ settlement payments. Cigarettes manufactured by the SPMs, which are part of the MSA but which have not settled with Mississippi, are subject to the “equity fees.”
House Bill 1630 would have exempted SPMs from Mississippi’s “equity fee,” even though the SPMs are not making settlement payments to Mississippi. SPMs would have remained exempt from the equity fee until a “credit amendment” (crediting the SPMs’ MSA payments for any equity fee payments made to Mississippi) was made to the MSA.
The bill died in committee shortly after it was introduced, suggesting an uncertain future for future efforts to exempt SPMs from these “equity fees.”
For questions and/or comments, please contact Bryan Haynes, at 804.697.1420 or by email.