Wyden, Colleagues Introduce Legislation to Tax E-Cigarettes

Bill would combat growing public health threat by taxing e-cigarettes like other tobacco products

Washington, D.C. – To combat the growing public health threat posed by use of e-cigarettes among young people, Senate Finance Committee Ranking Member Ron Wyden, D-Ore., and 18 colleagues today introduced legislation to tax e-cigarettes the same as other tobacco products.

Despite the Food and Drug Administration officially designating e-cigarettes as regulated tobacco products and at least 15 states establishing e-cigarette taxes, these addictive products remain exempt from federal tobacco taxes. The Congressional Budget Office previously estimated that for every 1 percent increase in the price of cigarettes the number of smokers declines by 0.3 percent and found that teenagers respond most strongly to higher cigarette prices.

“As the school year begins, parents face a new challenge—easily accessible e-cigarettes. These products are highly addictive. They are subject to minimal safety standards and oversight, exposing users to dangerous chemicals like formaldehyde. And, they are getting into the hands of more and more young people as imports from China have doubled year-over-year,” Wyden said. “A new generation of nicotine users has been created virtually overnight, and the companies making billions are downplaying the health risks. I’ve seen this before—it’s the same playbook the tobacco companies ran for decades. It’s time to combat this growing public health threat by taxing e-cigarettes like tobacco cigarettes.”

The E-cigarette Tax Parity Act would expand the definition of taxable tobacco products to include e-cigarettes and other alternative nicotine products. The bill would establish an excise tax on alternative nicotine products at a rate equal to the federal cigarette tax, equivalent to $1.01 per pack of 20 cigarettes. The tax on such products would be calculated on a per-milligram of nicotine basis because the nicotine content and delivery method of alternative nicotine products vary significantly.

“Tobacco taxes are a proven method to reduce tobacco use, particularly among youth. It is long overdue that e-cigarettes be subject to federal tax in order to curb the youth tobacco use epidemic. We appreciate Sen. Wyden’s leadership and look forward to working with him to improve the health of the nation,” Lisa Lacasse, president of the American Cancer Society Cancer Action Network (ACS CAN), said.

The bill is cosponsored by Senators Tom Carper, D-Del., Ben Cardin, D-Md., Sheldon Whitehouse, D-R.I., Jeanne Shaheen, D-N.H., Michael Bennet, D-Colo., Angus King, I-Maine, Maggie Hassan, D-N.H., Dianne Feinstein, D-Calif., Patty Murray, D-Wash., Jack Reed, D-R.I., Debbie Stabenow, D-Mich., Tom Udall, D-N.M., Jeff Merkley, D-Ore., Chris Coons, D-Del., Martin Heinrich, D-N.M., Ed Markey, D-Mass., Chris Van Hollen, D-Md., and Tina Smith, D-Minn.

A one page summary of the legislation is available here.

A copy of the bill text is available here.

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