Bill to tax electronic cigarettes at 15% goes to governor; health advocates say it will decrease young people’s use of the products

Centers for Disease Control and Prevention illustration; click for larger version
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By Melissa Patrick
Kentucky Health News

Kentucky lawmakers gave final approval Wednesday to a tax on electronic cigarettes, which is expected to decrease teen use of the products by increasing their price — and generate 25 million in extra revenue when state expenditures are skyrocketing and revenues are falling due to the coronavirus.

The Senate added the excise tax to the catch-all revenue bill, House Bill 351. It was a trimmed-down version of HB 32, which, among other things, would have put a 25 percent wholesale tax on e-cigarettes, generating about $50 million.

HB 351 cut the taxes to 15% on open “vaping” systems, like those typically sold in “vape” shops, and added a $1.50-per-pod tax on closed vapor cartridges, like those sold by Juul Labs.

Health advocates expect the tax to decrease teen use of the products. Following is a statement from the Foundation for a Healthy Kentucky, joined by the Kentucky Chamber of Commerce, the Kentucky Cancer Foundation, the Kentucky Equal Justice Center, the Kentucky Health Collaborative, the Kentucky Medical Association, the Northern Kentucky Chamber of Commerce and Kentucky Youth Advocates:

“This new tax is clearly a win for health in Kentucky, especially for our adolescents and teens, because it will result in a significant price increase that will deter many of our youth from using dangerous e-cigarette products,” said Ben Chandler, president and CEO of the foundation. “E-cigarettes are the only tobacco product sold in Kentucky currently not subject to an excise tax. The relatively low cost has been a factor — along with the kid-friendly flavors — in luring up to 80,000 Kentucky kids to try these highly addictive products.

“We applaud the legislature for adopting a pod tax that will substantially increase the price of the products that are most popular among youth right now, including the Juul and knock-off reusable devices and the Puff Bar and Posh disposable e-cigarettes. In the midst of the coronavirus pandemic, inhaling toxins that are shown to damage the lungs puts these kids and every other smoker and vaper in the Commonwealth at greater risk for serious complications from covid-19. This is an important bill today and for the future, and a strong step in the right direction.”

Rep. Jerry Miller, R-Louisville, the sponsor of HB 32, questioned why the Senate didn’t include the section of his bill that would have raised the tax on snuff products as a way to generate more revenue. His bill would have doubled the tax on snuff, which includes Snus packets, and he alluded to the lobbying influence of Altria Group, the maker of Snus and the nation’s largest tobacco-product manufacturer, with a smokeless-tobacco factory in Hopkinsville.

“Given that Altria had accepted the doubling of ad-valorem tax on snuff and Snus, and was therefore included in the governor’s budget and the House budget, I cannot understand why the Senate would not accept that increase in revenue,” Miller said in a statement read by House Republican Caucus Chair Suzanne Miles as most members voted and communicated remotely due to the threat of the coronavirus. But some thought the bill was still too much.

Sen. Robin Webb, D-Grayson, said she voted against it because she had not had time to read and digest it, and because she had filed several amendments, including one for a 10% tax. Sen. Tom Buford, R-Nicholasville, who also favored that rate and voted no, said “I am fearful that the vaping tax at 15 percent will drive many of our individuals trying to free themselves from the tobacco products back to them, not only that, but our youthful individuals.”

The bill passed the Senate on a 20-8 vote, with five passes, and the House 68-22. Gov. Andy Beshear is expected to sign it.

Here are some resources to help quit smoking:

  • Quit Now Kentucky offers nicotine replacement therapy and counseling , call 1-800-QUIT-NOW (800-784-8669) or text QUITKY to 797979.
  • My Life, My Quit, a quit-vaping service for teens that provides coaching by text message, by phone, or by online chat; call 855-891-9989 or text START MY QUIT to 855-891-9989.
  • This is Quitting, a free coaching service for those ages 13-24 to help them quit using e-cigarettes; text KENTUCKY to 88709.
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