Category: Taxation

July 1 is Start Date for New Louisiana Vaping Tax

Credit: Summer
A new law that increases the tax on vaping products in Louisiana takes effect on July 1.
But some vape shop owners say it is not the tax hike that bothers them the most about the new law.
Rep. Paul Hollis, from St. Tammany Parish, authored the bill that Governor John Bel Edwards signed into law.
“Basically, what we’ve done, we’ve increased the excise tax placed on vape products. Currently, it’s 5 cents, on July 1 it will go to 15 cents per milliliter,” said Hollis.
Hollis said revenues from the higher tax will benefit La. State Police. “We put this vape tax and we dedicate it to the state police salaries and the legislature obviously believes are long overdue. I’m embarrassed by what we currently pay state police, especially new officers,” said Hollis.
Landon Naquin said he owns Gotta Stop in Houma and is in the vape product business, according to FOX8Live.
“I’m actually not opposed to a tax increase within reason and I find that it’s in reasonable amount because frankly, the state has been losing money recently because so many people within my own business are transitioning from cigarettes to E-cigarettes and the state’s not collecting that revenue from the cigarettes they used to collect,” said Naquin.
Under the new law, beginning on October 1, vape product manufacturers and makers of alternative nicotine products that are sold in Louisiana will have to execute and deliver the certificate to the commissioner of the La. Office of Alcohol and Tobacco Control stating the product was on the market in the U.S. as of August 2016.
Naquin thinks that will have a significant impact.
“It pretty much only legally allows for three remaining products to remain on the market,” he said.
And the law calls for the ATC commissioner will have to develop and maintain a directory listing all vape and alternative nicotine product manufacturers that have provided certifications that comply with that law.
June 23, 2023
Bangladesh Minister Proposes Rise in E-Cig Import Duties

Bangladesh Finance Minister Mustafa Kamal proposed a significant increase in import duties on e-cigarettes and their parts in the proposed budget for the 2023–2024 fiscal year, reports the Dhaka Tribune.
The import duty on e-cigarettes will be raised from 5 percent to 25 percent, and for parts of electric cigarettes, the duty will be increased by 100 percent. Previously, there was no import duty on the parts of electric cigarettes.
The minister has also suggested a 150 percent additional duty on liquid nicotine and transdermal nicotine.
The proposed measures aim to increase import duties and make importation of e-cigarettes and related components more expensive in an effort to regulate their use and reduce their prevalence.
June 2, 2023
South Africa’s E-Liquid Tax Begins Next Month

Credit: Pavlo Fox
South Africa will introduce a sin tax for vaping products for the first time beginning June 1.
The introduction of the R2.90/ml ($0.15 cents) tax on vape juice on 1 June could more than double the price of the product in some instances, according to Asanda Gcoyi, CEO of the Vapour Products Association South Africa (VPASA).
R290 ($15) tax will be levied on a 100-milliliter bottle of vape juice, which costs R200, raising the price to R490 if all of the tax is passed on to consumers, according to News24.
Asanda Gcoyi
Gcoyi says the vaping industry is not surprised by the decision to impose the tax because it was discussed over several years.
“What is perhaps not ideal is the rate,” she adds. “The R2.90/ml as an introductory rate, in our view, is too high.”
The VPASA is expecting a 26 percent decrease in the demand for vape juice after the excise is introduced, which will affect businesses and employment, Gcoyi says.
The VPASA’s estimates show that 2,250 jobs could be lost by the end of the year. She believes people will “go back” to smoking relatively cheaper tobacco products.
May 19, 2023
Alaska’s Senate President Reintroduces Vape Tax Bill
Credit: Casimiro
Last year, Alaska’s Gov. Mike Dunleavy vetoed his first bill in office, S.B. 45, which would have increased the minimum age to purchase tobacco products from 19 to 21 years old, bringing it in line with the federal Tobacco 21 standard that was passed in late 2019.
Dunleavy didn’t state whether he supported the minimum purchasing age increase, but the bill would have also introduced a tax of 35 percent of the wholesale price on vaping and e-cigarette products and new taxes were not on the governor’s agenda.
“There were many conversations about what an appropriate level to tax would be, but ultimately a tax increase on the people of Alaska is not something I can support,” Dunleavy wrote in his veto letter to Senate President Peter Micciche.
The sponsor of SB 45 has now introduced a new bill that would do much of the same as the 2022 bill, writes Charlie Minato with Halfwheel.
Alaska Sen. Gary Stevens, has introduced SB 89 alongside Micciche, which would change a number of laws regarding the sale of tobacco and vaping products in Alaska, including:
Increasing the minimum age to purchase tobacco, nicotine or vaping products from 19- to 21-year-olds.
Introducing fines of up to $300 for anyone under the age of 21 years olds caught in possession of tobacco, nicotine or vaping products.
Banning the internet sale of tobacco, nicotine and vaping products except under certain conditions.
Introducing a tax on vaping products of 25 percent of the wholesale price.
Regarding the internet sales ban, there is an exception made if the sale is “by a retailer who sells primarily cigarettes, cigars, tobacco, products containing tobacco, electronic smoking products, or products containing nicotine and who restricts access to the premises to only those individuals who are 21 years of age or older.”
There are some exceptions. For example, certain vaping products sold at military facilities would not be subject to the new tax on vapor products. That said, the bill also contains language that could make it illegal for a person to ship tobacco products to someone else in Alaska.
The bill’s text seems to indicate that at least one of the parties involved in the shipment—the shipper or the recipient—likely needs to have a tobacco license or meet other special circumstances, if not, the shipment would be deemed illegal.
March 8, 2023
Nebraska Lawmakers Propose 20% Tax on Vapes

Credit: Niro World
Nebraska lawmakers have proposed Legislative Bill 584 would impose an excise tax of 5 cents per milliliter of consumable vaping material, though the senator said she is working on an amendment that would make the tax a percentage of the sales price, perhaps 20 percent.
State Sen. Jana Hughes of Seward, who called it “hooey” that vaping was safer than smoking cigarettes, despite several scientific studies stating otherwise, proposed the bill in to protect children from the dangers of vaping.
Nebraska is one of 20 states that do not, as of Jan. 1, impose an excise tax on vaping products, according to the Urban Institute, according to Nebraska Public Radio.
Hughes said all other products containing nicotine must pay an excise tax. Nebraska, for instance, imposes a 64-cent per pack excise tax on cigarettes.
Earlier this year, Nebraska lawmakers proposed a law that would limit localities in how they regulate electronic smoking devices.
March 5, 2023
Hawaii Considers 1600% Tax Increase on Vaping

Credit: Davis Franklin
Lawmakers in Hawaii want to tax electronic nicotine delivery systems and e-liquid products at a rate of 70 percent.
Right now, e-cigarettes only have the general excise tax (GET) of between 4.1 percent and 4.7 percent attached to them. Combustible cigarettes sold in Hawaii carry other taxes.
Rep. Scot Matayoshi and other lawmakers claim that the 70 percent tax proposed under House Bill 537 will bring vaping into tax parity with cigarettes and other nicotine products that already carry taxes in addition to the GET.
As of 2022, 696 vaping product retailers are registered in Hawaii.
Scott Rasak, a representative of Volcano eCigs, described the 70 percent tax as an industry killer, according to Civil Beat.
“Some of the bills they’re putting forward are ending people’s businesses and livelihoods that they spent the last decade building,” he said in an interview.
Rasak said that he wishes the Legislature would work more with the vaping industry to understand how it can make a positive impact on the community, instead of “targeting retailers that are responsible in selling the products under legal provisions.”
Last year, having survived a rollercoaster legislative session that saw the bill near death on multiple occasions, Hawaii’s ban on flavored e-cigarettes was signed by its governor.
February 9, 2023
Georgia to Vote on Two Bills That Include Vaping Tax

Georgia State Capitol Building in Atlanta, Georgia, USA. (Credit: F11 Photo)
A bill in the General Assembly of the U.S. state of Georgia would raise the state tax on vaping and other tobacco products and use the proceeds to improve health care.
Introduced by House Representative Ron Stephens, two bills in the contention could make the tax possible, according to 13WAMZ.
House bills 191 and 192 have the same language but their numbers are different. Bill 191 states a $0.57 tax per pack of 20 cigarettes and a $0.05 per fluid milliliter for vapor products in a closed system. For an open system, it would be a 7% tax on the wholesale cost price.
Bill 192 states a $0.37 tax per pack of 20 cigarettes and a 15% on vapor products at the wholesale cost.
Shabbir Hussain is a smoker himself and says using the money to help fund Georgia’s healthcare programs is a good thing.
“And $0.20 is not something people would worry about, and if that would benefit the health system, they should go for it,” Hussain said.
Last month, House Speaker Jon Burns said he was open to another healthcare proposal that has gone nowhere in the past – raising the state’s tax on tobacco products.
February 8, 2023
Kuwait Pauses 100% E-Cigarette Customs Duty Tax

Credit: Zero Photo
The government has decided to defer the application of a 100 percent customs duty tax on e-cigarettes – including flavored products – until further notice. The tax was supposed to go into effect on Jan. 1, 2023 after being postponed from Sept. 1 of this year, reports Al- Anba daily, as reported by the Arab Times.
“The Acting Director General of the General Administration of Customs, Suleiman Al-Fahd, according to a local Arabic daily, has issued instructions regarding postponing the application of single-use cartridges containing nicotine and packages of liquids or gels containing nicotine, whether flavored or unflavored, and packages of liquids or gels containing nicotine from the 100 percent customs tax,” the story states.
Al-Fahd had previously issued customs instructions to postpone the imposition of 100 percent tax on electronic cigarettes and their liquids, whether with or without flavor, for a period of 4 months, specifically, but according to the instructions, it is decided to postpone the tax application on four items until further notice.”
The list of the four items includes – the flavored single-use nicotine cartridges; unflavored disposable nicotine cartridges; liquid or gel packs containing flavored nicotine and liquid or gel containers containing unflavored nicotine.
The instructions come in addition to other Customs Instructions No. 19 of 2022 issued in Feb. 2022 regarding the application of what was introduced in the Main Clause 2404 of Chapter 24 of the unified customs tariff system for the GCC countries by subjecting cartridges containing single-use nicotine flavored, unflavored and packages of liquids or gels containing flavored or unflavored nicotine for a 100 percent customs duty.
December 21, 2022
Consumer Group Denounces EU Vape Tax Proposal

The World Vapers’ Alliance (WVA) has denounced the EU’s leaked plan to increase vaping taxes, according to the U.K. Vaping Industry Association.
“The [EU] Commission claims that higher taxes will improve public health, but the reality is the exact opposite,” said WVA Director Michael Landl. “A less harmful alternative, such as vaping, must be affordable for ordinary smokers trying to quit cigarettes. If the commission wants to reduce the burden of smoking on public health, they must make vaping more affordable and accessible, not less.
“High taxes hit the least advantaged people most. In times of multiple crises and people struggling to make ends meet, making vaping more expensive is the opposite of what we need. Policymakers must understand that tax increases on vaping will force people back to smoking or the black market, a scenario nobody wants. In times of crisis, people shouldn’t be further punished by an unscientific and ideological fight against vaping. This must be stopped,” said Landl.
“Rather than fighting vaping, the EU finally must embrace tobacco harm reduction. What we need is risk-based regulation. Vaping is 95 percent less harmful than smoking and, therefore, must not be treated the same way as conventional smoking,” added Landl.
November 29, 2022
Brussels to Propose First EU-Wide Vaping Levy
In a long-anticipated move, the European Union is to propose a bloc-wide vaping tax policy as part of a shake-up of levies on the tobacco industry. The new rules would also double excise duties in member states with low cigarette taxes, according to a draft European Commission document.
The update to the 2011 EU tobacco taxation directive will tax novel smoking products, such as e-cigarettes, vapes and heated tobacco, comparatively with combustible cigarettes as policymakers worldwide take an increasingly dim view of the new products’ popularity among young people.
Products with a high nicotine content would have an excise duty of at least 40 percent applied to them, while lower-strength vapes will face a 20 percent duty. Heated tobacco products will also be hit by 55 percent duty, or a tax rate of €91 per 1,000 items sold.
The changes to legislation, part of a push by Brussels to cut smoking rates, will increase the EU’s minimum excise duty on cigarettes from €1.80 to €3.60 per pack of 20, which would raise prices in eastern European nations where packs can sell for under €3.
Alberto Alemanno, professor of EU law at HEC Paris business school, told the Financial Times that the absence of an EU-wide excise framework for vaping and heated tobacco products had been “weakening tobacco control efforts” across the bloc.
Excise duties on cigarettes would also increase considerably in countries such as Austria and Luxembourg where prices are low relative to income. The tax rise on cigarettes is expected to generate an extra €9.3 billion for EU member states.
The changes aim to speed up the EU’s push for a “tobacco-free generation” by 2040. As part of the EU’s Beating Cancer Plan, health officials want to drive tobacco use among EU citizens from the current level of about 25 percent down to 20 percent in 2025, and below 5 percent by 2040.
The commission this month imposed a ban on flavored heated tobacco products to curtail a surge in demand among younger consumers. In the U.S., regulators at the Food and Drug Administration have moved to ban popular vaping products, such as Juul.
Peter van der Mark, secretary-general of the European Smoking Tobacco Association, an industry body, warned that “if you have a sudden very steep increase, you can create a market for illicit trade.” Dustin Dahlmann, president of the Independent European Vape Alliance, added that imposing taxes on novel tobacco products could lead to “the much less harmful alternatives” to smoking being “taxed far too heavily in many countries.”
A leaked impact assessment said that the increase in the minimum excise duty would have “a strong impact on consumers and economic operators” in EU states where cigarette prices were low, including Bulgaria, Slovakia, Poland and Hungary. The assessment also noted that the excise duty on novel tobacco products “which are particularly appealing to young people, who are at risk of developing addiction” would aid public health efforts to cut tobacco use.
The proposal will have to be agreed by all EU member states before it is enshrined in law. British American Tobacco, one of the world’s biggest cigarette manufacturers, stressed this was “the beginning of a long legislative process.”
November 27, 2022