Senate Democrats deferred to the proposal to impose a federal tax on nicotine vaping. It would have hurt a potentially lifesaving product and violated President Joe Biden’s commitment to reduce taxes for American households earning less than $400,000 annually. The Wall Street Journal reports that Sen. Catherine Cortez Masto (D–Nev.As a member, the Senate Finance Committee, he “pushed for removal of tax”, which was part of House version of Build Back Better and helped to “force its cancellation.”
The original proposal of the House Democrats included a $100.66 tax on 1,810mgs of nicotine in electronic liquids. This would have cost about $60 more than a high strength 60-milliliter bottle that contains 18mgs per milliliter. Retailers reported that the tax could have increased the retail price by as much as three times for some products. This proposal would also have raised the federal excise taxes on cigarettes and tobacco products. It is estimated that this proposal will generate $96 billion more revenue in a decade.
The proposal to tax eliquids was replaced last month by one that taxes them at $50.33 for 1,810 mgs nicotine. This is still a substantial levy and would significantly increase the price of vaping. And, unlike the original plan, it wouldn’t have raised federal cigarettes taxes, which would have reduced vaping’s relative economic appeal. This would raise only $9 billion over the next ten years.
It was promoted by the supporters of nicotine tax as a public health measure. This is aimed at reducing underage tobacco consumption. However, it could discourage existing smokers from changing to a safer source of nicotine. It may have resulted in more tobacco-related deaths. Ex-smokers who use vape now would be encouraged to return to the more dangerous habit due to increased costs.
Gregory Conley of the American Vaping Association stated in response that there was no reason for new taxes to be imposed on nicotine-free products. Conley noted that House Democrats had perversely sought to increase the cost of smoking by making smoke-free products more costly than traditional cigarettes.
Cortez Massto did not address the health effects of the tax on public health, instead focusing her attention on Biden’s contradiction with the promise. Last month she described the proposed levy as “a regressive tax on the very people that we’re trying to cut costs, cut taxes on.” Sen. Joe Manchin (D–W.Va.In November, who was he? saidThe nicotine tax was “not logical to me,” and it also did not include the harmful effects of vaping products. Neither did Sen. Kyrsten Sinema (D–Ariz.He also opposed the tax.
Michelle Minton (a senior fellow with the Competitive Enterprise Institute, who studies tobacco policy), welcomed the removal of the vaping taxes. Minton released a statement saying that Democrats have avoided a major public health catastrophe by dropping the nicotine taxes from the Build back Better bill. Tax increases on safer nicotine products will not have a meaningful impact on youth vaping. This would make it more difficult for adult smokers to switch to healthier alternatives. The increased poverty and misery of the majority of lower-income Americans does not make it easier to rebuild better.
An August American Journal of Public Health David J.K. Balfour (and 14 other top tobacco researchers) warned that “policies to reduce vaping in adolescents,” such as taxes and flavor bans “may also decrease adult smoking attempts to quit.” These researchers stressed the “potential lifesaving benefits” of electronic cigarettes for adult smokers, which should be given equal attention to their risks.