A Jacksonville-based company that touted making 4 million cigars a day back in 1964 for 48 countries now says it will have to lay off 50 to 90 employees at its local headquarters and move manufacturing to the Dominican Republic.
The measures are being blamed on a federal tax policy that makes it more expensive to produce cigars in the United States vs. foreign lands, company officials said Thursday.
When the layoffs will occur is unknown at this point, said Joe Augustus, Swisher International’s senior vice president of global affairs at its corporate headquarters and manufacturing plant at 459 E. 16th St. Those will be phased in, with the affected areas notified as they occur, he said.
The layoffs and the move are something the company has been discussing due to government regulation of tobacco and a tax policy that Augustus said needs to be changed so they can be competitive in the United States against foreign manufacturers.
“This is an ongoing announcement we made five years ago that we would move parts of our manufacturing to the Dominican Republic as a result of federal tax policy in Congress,” Augustus said. “The way it is written, it is more beneficial to be an importer than a manufacturer. We have had countless meetings on Capitol Hill to say the law is flawed ... and that if they moved on it, it would cost jobs in Jacksonville and Florida, which it has done.”
Augustus said the company, in Jacksonville for about 90 years, already has a manufacturing site in the Dominican Republic and has sent employees there in recent years. The company still makes some cigars in Jacksonville, but the majority are now done at that Dominican Republic facility. Swisher International’s headquarters will remain in Jacksonville and continue to do some distribution from there, he said.
The news comes only days after the company’s 36-year-old tax manager was arrested on a charge of grand theft after millions of dollars was embezzled from the cigar maker over the past year, according to the Jacksonville Sheriff’s Office.
Gretchen Michele Camp of Yulee was arrested Monday night, then released on a $250,000 surety bond the next day, according to Duval County jail records.
“It’s an ongoing investigation,” Augustus said. “She is no longer employed by us.” He called the issue “unfortunate,” but had no further comment.
The arrest report states that bogus invoices were created for a Georgia company that did not supply any services to Swisher and is owned by a friend of Camp’s husband. Over the last year an estimated $4 million was paid. Police said company executives confronted Camp about the invoices and were told she had created them, the report said.
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