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Which States Might Be Increasing Vape Taxes Soon?

By Paul Freeman February 14, 2020 0 comments

Which States Might Be Increasing Vape Taxes Soon?

Paul Freeman

The vaping industry has been in the news quite a lot over the last few months, and unfortunately, it hasn’t been for good reasons, at least as far as vapers are concerned.

Right now, we’re dealing with new legislation that bans flavored e-liquid cartridges, in addition to an increase in the age requirement for obtaining nicotine products.

Now, more and more states are suggesting raising the taxes on vaping products, and all of this supposedly influenced by a need to curb teen vaping. Or, so legislators say.

So, what’s going on with the taxes on vaping, and does it impact your state? Today, we’ll be attempting to answer these questions as thoroughly as possible, while also demonstrating the real probable motivations behind raising the taxes on vaping products, state by state.

Increased Taxes Throughout the United States

As it stands, the United States does not have a tax on vaping products. In other words, there is no federal tax on e-liquids, e-cigarettes, and all other vape-related goods. However, states have the authority to take matters into their own hands and taxing goods as they see fit. 

Now, for a while, vapers had little to complain about regarding the taxes on vaping products. After all, with such astronomical taxes on cigarettes across the country, vaping remained far more affordable due to relatively low fees.

Taking a look at the current tax landscape we can see that many states already have put in place local regulations. 

Freeman Vape Juice is located in the state of California, so we already pay quite a bit in taxes not to mention all the FDA regulations to keep our company compliant. But we always try our best to work closely with the law enforcers to keep up the good practices in our industry, and I personally hope more companies will start working hard to keep things smooth between our industry and law makers.

But it's also in our right to ask for human decency when it comes to these policies. As of today this is the landscape of taxes in the vape industry in the wholesale business.

However, states are becoming more proactive, or at least, so they claim, against what they consider to be an epidemic of vaping among minors. And, one way that they’re attempting to curb teen vaping is by raising the taxes on vaping products.  

Personally I think that the teens should stay away from many things, and that it's true that big companies like Juul should have a better marketing team. But this so called teen epidemic can be handled in a way that doesn't affect the rights of adults to access flavored e-liquids. It simply doesn't seem right, especially with the declining rates in smoking and how important vaping is in the life of millions of adults that rely on us delivering the alternative.

This shouldn’t be too much of a surprise especially after we’ve seen states all across the country issuing flavor bans, one by one.

The reason?

Due to the fear-mongering of news outlets claiming that e-cigarettes cause respiratory illnesses, even though these illnesses proved undoubtedly to have links with THC cartridges agitated with vitamin E, which have absolutely nothing to do with the highly regulated vaping industry.

Just several days ago, Minnesota introduced a tax on vaping products and was one of over 20 states to do so. 

What’s interesting is that data shows that after Minnesota began taxing e-cigarettes and the like, the number of tobacco cigarette users increased. Wouldn’t that be an undesirable outcome, as we know that cigarettes kill hundreds of thousands of people each year, while no such data regarding vaping exists

Of course, the amount of taxes placed on vaping products differs from state to state. Vermont recently put a 92 percent tax on e-cigarette products, which is pretty astronomical. It goes without saying that these high taxes are going to hurt the vaping industry, which is deeply concerned with trying to get people off of cigarettes for good. 

Are These States Trying to Curb Teen Vaping?

Vapers paying attention to news stories regarding the industry don’t have to reach too much to see hypocrisy among elected officials who advocate against vaping. 

Yes, minors have indeed been able to access vaping products, although this is not the fault of the industry, but individual vendors who do not enforce the law regarding the age limit. At the same time, the weak penalties for those who break the law in the first place created an environment where these situations can happen.

The vaping industry has never attempted to market their products toward teenagers, although it’s understandable that certain flavors of e-liquid products may appeal to young people.

So, are these new vape taxes genuinely motivated by a wish to stop young people from using e-cigarette products? Well, of course, we can’t say for sure whether or not this is the case. But what we do know is that states are losing money on vaping.

For one thing, states make a pretty good amount of money off of the high taxes on cigarette products. The more people abandon cigarettes and switch to vaping; the fewer revenue states receive from the taxes on cigarettes. So, it’s easy to understand why states would have a financial interest in trying to keep people hooked on tobacco.

Then, there’s MSA money, which refers to the Master Settlement Agreement from back in 1998.

After numerous lawsuits hit the tobacco industry, the five leading tobacco companies made a deal with 46 states that if they dropped the trials, the states would receive hundreds of billions of dollars to go toward various means to get state citizens off of cigarettes.

The problem is that states tend to abuse this money by allocating it toward other things, which means that they’re heavily dependent on this money. And guess what? The money that each state gets per year from the MSA is determined by how many people are using cigarette products.

The more cigarettes are sold in a state per year, the more money the state gets from the agreement. So, it’s safe to conclude that these new taxes on vaping products are an effort to ensure that states keep getting money from big tobacco sales.

There is a link between current states that use these cigarette taxes and the next places we will be seeing huge increase in vaping taxes.

Ulterior Motives Behind New Taxes On E-Cigs and Other Vaping Products is Crystal Clear

Whether altruistic or not, these taxes directly harm the vaping industry, and individual vapers even more. However, for the time being, it seems inevitable that taxes on vape products will rise as legislation cracks down on vaping more and more throughout the country.


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