Most of you have already heard that you can now bring Cuban cigars back from Cuba into the U.S. On October 14, 2016, the Department of Treasury’s Office of Foreign Assets Control (OFAC) and the Department of Commerce’s Bureau of Industry and Security (BIS) announced new amendments to the Cuban Assets Control Regulations (CACR) and Export Administration Regulations (EAR), including increasing the limitation on the import of Cuban cigars to the U.S.
According to a Department of Treasury Cuban Fact Sheet, “OFAC is removing the monetary value limitations on what authorized travelers may import from Cuba into the United States as accompanied baggage. This includes the value limitation on alcohol and tobacco products. Persons subject to U.S. jurisdiction will be further authorized to import Cuban-origin merchandise acquired in third countries into the United States as accompanied baggage, again without value limitations. OFAC is also removing the prohibition on foreign travelers importing Cuban-origin alcohol and tobacco products into the United States as accompanied baggage. In all cases, the Cuban-origin goods must be imported for personal use, and normal limits on duty and tax exemptions will apply.” You can view the Department of Treasury’s Cuban Fact Sheet announcing this change HERE.
On October 17,2016, the Department of Treasury released further details in the Federal Register, stating, “Importation of Cuban merchandise. Section 515.560 previously authorized persons subject to U.S. jurisdiction engaging in authorized travel to Cuba to acquire merchandise in Cuba and import it into the United States as accompanied baggage, provided that the merchandise was for personal use only and had a value of $400 or less (with no more than $100 of such merchandise consisting of alcohol or tobacco products). OFAC is now removing these monetary value limits, which means that the normal limits on duty and tax exemptions for merchandise imported as accompanied baggage and for personal use will apply. OFAC will continue to require that such merchandise be imported as accompanied baggage and for personal use.” You can view the Federal Register release HERE.
This equates to 100 cigars worth up to $800. If you bring back more than 100 cigars or less than 100 cigars worth more than $800, you will pay normal duty fees. The new rules apply not only for purchases in Cuba but also the purchase of Cuban cigars in other countries brought back to the U.S. You can bring back 100 cigars duty-free every 31 days.
So, this all sounds great, right? This is an interesting change in policy when compared to the recent Food and Drug Administration (FDA) (FUFDA) regulations making it virtually impossible to sell “new” cigars in the U.S. It is still against the law to sell Cuban cigars in the U.S. and once approved, Cuban cigars will have to undergo FDA testing before sale, however, your average herfer can bring back cigars from your next trip to London without issue. Wait, I thought the purpose of the FDA regulations are to protect us from the health implications of cigar smoking?! I guess Cuban cigars are good for you. . .
So, this all sounds great, right? Part II. Every Cuban cigar you purchase is likely a cigar you will not buy from your local cigar retailer. While I doubt this will be the end of U.S. cigar retailers, they will definitely feel the pain.