HB 2165 Feels Like Déjà Vu
HB 2165 – 2017-18: Concerning vapor products, e-cigarettes, and nicotine products taxation.
Pulled verbatim from Part I (Findings) of the bill:
The legislature finds that the use of vapor inhalation products, such as e-cigarettes, e-devices, and vape pens, has risen at an alarming rate both among adults and youth. Vapor products pose a serious public health risk because of the addictiveness of nicotine, the impact of nicotine on fetal development and adolescent brain development, the risk of liquid nicotine poisoning, and exposure to carcinogens and other toxic chemicals. The legislature finds that the nicotine in these vapor products is almost exclusively processed or derived from tobacco and that the products are intended for human consumption in the oral or nasal cavity or absorption into the human body. Therefore, the legislature finds that these vapor products, including electronic cigarettes and other products are “tobacco products” as defined in RCW 82.26.010. Although these products have been documented as being interchangeably used by consumers with cigarettes or other tobacco products, and there is nicotine produced or derived from tobacco in the product intended for human consumption and absorption into the human body, the manufacturers, wholesalers, and retailers have not been paying the tax levied on tobacco products pursuant to chapter 82.26 RCW. The legislature intends to transition from no tobacco or cigarette tax having been paid on these products to adopting a specific tax rate for vapor products in this act. Adoption of this specific tax will resolve claims of nonpayment of tobacco product taxes pursuant to chapter 82.26 RCW. The legislature believes that vapor products containing nicotine have always been subject to taxation pursuant to chapter 82.26 RCW, and passage of this act may not be interpreted as an indication otherwise.
HB 2165 would add a 60% tax on the sale of vapor products
According to CASAA,
“Consumer Advocates for Smoke-Free Alternative Association— while most consumers will feel this increase in the form of a wholesale tax (paid by the distributor when they purchase products from the manufacturers), consumers who shop online will, effectively, pay a 60% sales tax.”
If you recall, the Tobacco Master Settlement Agreement (MSA) was entered in November of 1998. It was an agreement between the four largest United States tobacco companies; Philip Morris Inc. R. J. Reynolds, Brown & Williamson and Lorillard and the attorney generals of 46 states over Medicaid lawsuits for the recovery of tobacco-related health-care cost. Within the MSA, the four aforementioned tobacco companies agreed to pay a minimum of $206 billion over the first 25 years of the agreement.
According to a 2017 report released by Forbes, the e-cigarette industry is worth almost $4 billion dollars. Chump change in comparison to big tobacco’s 2012 global net worth valued at $500 billion, which equates to more than $1,100 a second in earnings. Yet, with more than 70 percent of American smokers saying they want to quit analog cigarettes, not to mention the roughly 480,000 Americans dying annually from smoking-related illnesses, the states are feeling the crunch from the reduction in cigarette sales.
According to Vaping360, HB 2165 is larger than the 40% tax that led to the demise of more than 200 vape shops in the state of Pennsylvania. The authors have stated that this bill is intended to recoup money from smoke-free vapor products in order to make up for the revenue the states continue to lose from 18 to 20-year-old smokers.
E-cigarette expert, Jim McDonald of Vaping360 writes,
“… this tax is being tied to popular Tobacco 21 legislation.”
Like most tobacco control organizations, Tobacco21 not only opposes smoking but maintains a zero-tolerance policy toward low-risk nicotine products as well. McDonald writes that Dr. Rob Crane, a medical professor at Ohio State University vehemently opposes vaping and doesn’t at all mind twisting the facts to get his point across as is noted on the Tobacco21 page— “Electronic Cigarettes: a gateway to adult smoking.”
McDonald goes on to say,
“the problem with this stance is that there are lots of people under 21 who are already smoking cigarettes. They need access to low-risk, high-quality vaping products just like smokers over 21. Like the many tobacco control and “health” groups that support their work, Tobacco21 wants everyone under 21 to just say no to nicotine. But in the real world, there are lots of teenage and young adult smokers— and the longer they wait to quit, the harder it becomes.”
Although HB 2165 was heard in the capitol this past Thursday, there is still time to take action by sending a message to your lawmakers urging them to oppose this bill.
Click this link to TAKE ACTION AND OPPOSE THIS BILL!
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