Tag: Taxation

  • Colorado Voters to Decide on Nicotine Tax in November

    Colorado Voters to Decide on Nicotine Tax in November

    Photo: Yekophotostudio | Dreamstime.com

    Voters in Colorado will make the decision on whether to raise taxes on nicotine products in November. The Centennial State’s governor, Jared Polis, signed legislation on Wednesday referring a question to the statewide ballot.

    “Colorado voters will have a really important opportunity this November to say it’s time that Colorado no longer be the top state for teen vaping,” Polis said, according to an article thecentersquare.com. “It’s time that we help make sure that less kids get hooked on nicotine, a habit that is hard to kick and often stays for life and will shorten their lives.”

    Polis added the measure would be “an extra boost for smoking cessation programs.” Voters must approve the measure under the state’s Taxpayer’s Bill of Rights (TABOR) because it includes a proposed tax increase, according to the article.

    A fiscal note for the legislation says the measure, if approved, would bring in $82.7 million in fiscal year 2020-21, and $167.6 million in fiscal year 2021-22.

    Revenue from the tax increases would go toward the State Education Fund, Rural Schools Fund, a preschool program, tobacco education programs, and a health care fund.

    Last year, a measure to increase taxes on tobacco and nicotine products that had Polis’ backing didn’t make it through the legislature.

  • UKVIA Wants Tax Parity With NRTs for Vapor

    UKVIA Wants Tax Parity With NRTs for Vapor

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    A vapor industry advocacy group is calling for the UK government to consider a similar VAT rate for vaping that currently applies to nicotine replacement therapies (NRT). The UK Vaping Industry Association (UKVIA) is calling upon government as the Chancellor of the Exchequer is widely reported to be looking at reducing the VAT rates in the wake of the coronavirus as the Government last did during the 2008 economic downturn, according to a press release.

    In a letter to the Chancellor of the Exchequer, Rishi Sunak, the UKVIA urges the government to consider a level playing field in regard to the VAT rate between NRT and vaping products, to support adult smokers who would otherwise not quit smoking to make the switch to vaping, the release states.

    The letter points to the recent Public Health England (PHE) Vaping in England Report that found that when vaping products were used in an attempt to quit, either alone or with licensed medication, success rates were comparable to, if not higher than, NRTs alone.

    The current VAT chasm between NRT products (5 percent) and vaping (the full 20 percent VAT and the same as conventional cigarettes) despite the fact that e-cigarettes, whilst not considered a cessation product, have significant potential to have a positive impact on public health. “This is backed up by research commissioned by the NHS last year which revealed that e-cigs are twice as effective as nicotine patches, gum or sprays for quitting smoking,” according to the release.

    John Dunne, director at UKVIA, said the vaping sector has been a “major retail success story this century and is playing a major role in getting smokers to quit, thereby helping cut the huge annual cost of healthcare” that is often associated with smoking.

    “Yet according to research nearly 1 in 10 smokers do not switch to e-cigarettes because they considered them to cost too much,” he said. “Ensuring that the price of vaping products remains much lower than cigarettes is vitally important in continuing to encourage the some 7m smokers in the UK, who otherwise do not quit, to make the switch.”

    He goes on to explain that the UK is still in the recovery phase of Covid-19 and a significant VAT reduction for vape products would pay back both economically and from a healthcare perspective.

    “A VAT rate for vaping on par with NRT would also support the call in the recent PHE report for smokers to be encouraged to try regulated nicotine vaping products along with smoking cessation medications and behavioural support to increase their chances of successfully stopping smoking,” he said.

  • Vapers in Georgia to pay 7% Excise Tax

    Vapers in Georgia to pay 7% Excise Tax

    Credit: Dawid Cedler

    Georgia’s General Assembly passed a measure Friday to authorize the taxation of vapor products. The bill also contained language that raises the U.S. state’s minimum age to vape or smoke cigarettes from 18 to 21.

    The measure slaps a 7% excise tax on vaping products sold in Georgia like e-cigarettes, vape pens, refillable cartridges and electric hookahs, according to an article in the Athens Banner-Herald.

    The vaping tax was added to a separate bill that raises the minimum age to use tobacco and vape products to 21. The bill passed by a 45-8 vote in the Senate Friday after the state House passed it by a 123-33 vote on Thursday. It now heads to Gov. Brian Kemp for his signature.

    Vaping manufacturers and store owners had opposed the excise tax and new licensing rules in Rich’s proposal, arguing higher prices on vaping could drive smokers back to cigarettes after using the tobacco-less products to kick the habit.

  • Michigan Adds Vapor Tax, Allows Flavored E-Liquids

    Michigan Adds Vapor Tax, Allows Flavored E-Liquids

    Credit: Pasja 1000

    The Michigan Senate approved a six-bill package Wednesday that would impose an 18 percent tax on e-liquids. If signed into law, it specifically would allow individuals to sell flavored vaping products.

    Gov. Gretchen Whitmer attempted last year to make Michigan the first state in the nation with a ban on flavored vaping products out of concern for youth usage. But the courts eventually paused the ban after businesses filed a legal challenge, according to an article on detroitnews.com.

    The new legislative package, which gained the backing of the Republican-controlled Senate, would set up an enforcement and licensing system for shops that sell vaping products.

    It would also change the age requirement for buying tobacco and vaping products from 18 years old to 21 in state law. President Donald Trump previously instituted a federal change to increase the age to 21 across the country.

    “It’s regulated. It’s enforced,” Senate Minority Leader Jim Ananich, D-Flint, said about the bills, which he said would give adults the “choice one way or another” whether to use the products.

    Ananich was one of the sponsors of bills in the package. He said it aimed to resolve a lack of clarity surrounding federal and state policy on vaping in Michigan. The legislation, which doesn’t affect marijuana vaping products, originally aimed to set the tax rate at 24 percent but lawmakers dropped the proposed rate to 18 percent before Wednesday’s vote.

  • Colorado to Vote on Placing Vapor Tax on Ballot

    Colorado to Vote on Placing Vapor Tax on Ballot

    Credit: Henry Desro

    Colorado lawmakers introduced a measure Thursday to put a tobacco and vaping tax measure on the November ballot.

    The bill — an effort to avoid a costly and difficult campaign to put the measure on the ballot via petition — comes a day before the session was scheduled to conclude. If it clears its first hurdles, lawmakers will need to meet Saturday for a final vote, according to an article in the Denver Post.

    It would also create a tax on nicotine products such as on vape products that would be equal to 50% of the manufacturer’s list price until July 1, 2024; 56% until July 1, 2027; and 62% after.

    House Bill 1427 calls for smaller increases in taxes than the citizen-led Initiative 292, but it comes with a commitment from the governor and proponents that there will be no more taxes on the products for six years, according to a document obtained by The Denver Post.

    The bill calls for asking voters to increase the cigarette tax from 1 cent to 6.5 cents until July 1, 2024; increasing it to 8 cents until July 1, 2027; and then increasing it to 10 cents. It would make the minimum price for a cigarette pack $7 and $70 for a carton until July 1, 2024, and then going up to $7.50 and $75, respectively.

    For the first two and a half years of the tax, $450 million would go toward the state’s general fund and after that, the money would toward preschool education.

  • Estonia Mulls End to E-Liquid Taxes

    Estonia Mulls End to E-Liquid Taxes

    Two justice scales colliding
    Photo: Skypixel | Dreamstime.com

    Lawmakers have submitted a bill to Estonia’s Parliament that would stop the collection of excise duty on tobacco e-liquids for two years.

    The legislators hope the measure will help to control the border trade and black market.

    In the draft explanation, the bill’s authors note that stopping the collection of excise duty will give entrepreneurs an opportunity to cut the price of e-liquids and encourage the sale of legal products.

    If passed, the legislation will enter into force on Dec. 1, 2020.