February 3, 2016

Have you noticed the price of your favorite vape products going up? If not, that may change as more states seek to tax e-cigarettes and their accessories. Below is an overview of the state of e-cig taxes in America at the beginning of 2016.

Failed, Current, & Proposed E-Cig Taxes By State

Before we look at current and pending legislations for the taxation of vape products, let’s first look at the states where attempts to tax vape products have failed. All information provided comes from the National Association of Tobacco Outlets unless otherwise noted. Each state is listed next to the rejected tax:

Failed E-cig Tax Legislation By State

Alabama – 25 cents for each milliliter of e-liquid

– 25 cents for each milliliter of e-liquid Arizona – 18 cents for each milliliter of e-liquid

– 18 cents for each milliliter of e-liquid Arkansas – 7.5 cents for each milliliter of e-liquid

– 7.5 cents for each milliliter of e-liquid Indiana – 24 percent of the wholesale price on all vape products

– 24 percent of the wholesale price on all vape products Kentucky – 40 percent of the wholesale price on all vape products

– 40 percent of the wholesale price on all vape products Montana – 1.73 cents for each milliliter of e-liquid

– 1.73 cents for each milliliter of e-liquid Nevada – 30 percent of the wholesale price on all vape products

– 30 percent of the wholesale price on all vape products New Hampshire – same as tobacco products

– same as tobacco products New Mexico – 4 cents for each milliliter of e-liquid

– 4 cents for each milliliter of e-liquid Oregon – same as tobacco products

– same as tobacco products Virginia – 40 cents for each milliliter of e-liquid

E-cig Tax Legislation Already Passed

Here is the current list of states and cities that have successfully imposed taxes on vape products:

Minnesota – E-cigs and e-liquids are now classified as tobacco products, which makes them subject to a tax of 95 percent on the wholesale cost. Minnesota was the first state to officially tax vape products.

North Carolina – 5 cents for each milliliter of e-liquid. NC was the second state to tax vape products.

Chicago, Illinois – 80 cent per “product unit” and 55 cents for each milliliter of e-liquid. This legislation effectively doubles the cost of vaping in Chicago.

Vermont – 46 percent of the wholesale price on all vape products, which is half the tax imposed on traditional cigarettes

Washington D.C. – 70 percent of the wholesale price on all vape products

Virginia – 18 cents for each milliliter of e-liquid

E-cig Tax Legislation Still Pending

Vapers in the following states are waiting for the official word on proposed e-cig taxation:

Maine – A bill that would tax vapor products at the same rate as tobacco cigarettes was to be discussed at a hearing on January 13, 2016, but the meeting was cancelled and is yet to be rescheduled. The bill would categorize e-cigs as tobacco products and every 18 mg of e-liquid as a single cigarette for taxation purposes. Tax rates are set to increase every couple of years. See the campaign CASAA is running to oppose the troubling legislation.

New Mexico – A 66 percent tax on all vape products is under consideration in the senate. Sen. Cisco McSorley has also vowed to reintroduce proposed legislation to tax vape products based on nicotine content.

California – Petitions are being gathered for a ballot proposition to increase tobacco taxes and extend them to cover vape products as well

Massachusetts – HB 2434 proposes applying tobacco tax rates to all vape products

Pennsylvania – 5 cents for each milliliter of e-liquid

Rhode Island – 70 percent the wholesale price on all vape products

Virginia – 40 cents for each milliliter of e-liquid. The legislation would also authorize city governments to enact their own taxes on vape products.

New Jersey – Proposed legislation would require all manufacturers, distributors, wholesalers and retailers of vape products to apply for a license and pay an annual fee in addition to a 75 percent tax on all e-cigarette sales.

Washington – Proposed legislation has been referred to finance and includes a 60 percent tax on the wholesale price of all vape products.

The Future of E-Cig Taxes

There has been quite a bit of debate regarding what taxes on vape products could do to the industry, from the potential of creating a new Black Market to turning vapers back to smoking. As more and more state and local governments implement e-cig regulations and taxation, this will continue to be a heavily debated topic; therefore, vapers and businesses in the industry are encouraged to speak up. If your state has yet to tax vaping, it’s only a matter of time, so if you’re living in a state or city with proposed or pending legislation, be sure to contact your local representative to make your voice heard with regards to how a high tax rate could effect you as a vaper, or your business if you’re working in the vaping industry. Also be sure to stock up on your favorite flavors of e-liquid before prices begin to skyrocket.