SANTO DOMINGO.- The head of the Senate’s Farm and Agribusiness Commission asked the Congress to reject a new tax on cigars, as it would “condemn the national tobacco industry."

Amílcar Romero (PLD-Duarte) said a new U.S. tax on cigars would cause losses of over US$100 million for the industry, in addition to the loss of jobs in one of the country’s poorest zones.

He said he stays in touch with ambassador in Washington, Flavio Darío Espinal, to lobby on the Dominican producers’ concern in the U.S. Senate.

The Cigar Producers Association (Procigar) stated their concern to Romero on the Dominican cigars’ future, if the new tax is approved. They said they cultivate in the country’s Cibao and Northwest regions close to 20,000 hectares, which can’t be used for any other type of crop.

Procigar said if approved it the legislative piece -an initiative of New York representative Charles Rangel- would be a hard blow for the cottage industry’s 25,000 direct jobs. "This would aggravate unemployment in the country, already affected from the reduction experienced by the free zones sector."

According to a source, tax on cigars is to partially fund the Children's Health Insurance a bill the US House passed Wednesday and the US Senate last night by a 68-31 vote, which protects it from a president George W. Bush veto, if he opts for that route.

The source said the current US tax on a cigar in is 5 cents per cigar, though would climb to 53% of the cigar’s value at the time it enters the US, with a maximum tax of $10.00 per cigar.