States Look to Tax and Regulate E-Cigarettes in 2014

by

e-cigarette

From Congress.org by KSE Focus

The U.S. Congress, the European Union, the FDA and state legislatures from coast to coast are examining ways to regulate, tax, or ban advertising of e-cigarettes, a $1.7 billion industry in the U.S. and growing. Because these products generally contain no tobacco, they fall outside the jurisdiction of most traditional state laws regulating tobacco products. Legislation was introduced in almost every state in 2013 and Arkansas, Hawaii, Illinois, North Carolina and South Carolina passed bills, primarily addressing the sale and marketing of e-cigarettes to minors. Other states and municipalities have moved to more broadly regulate advertising or have added e-cigarettes to existing regulations banning indoor smoking in public spaces.

Failing swift action at the FDA we expect a major legislative push in the states in 2014 to regulate the fast growing e-cigarettes industry. Prompted by intense lobbying by health advocates some 40 state attorneys general have sent two letters to the FDA asking that they regulate e-cigarettes as they do tobacco and tobacco products. The New York Times has reported that a draft FDA rule, which is not public, has been sent to the Office of Management and Budget and the White House’s Office of Information and Regulatory Affairs for review.

E-cigarettes deliver nicotine in the form of water vapor. They are different enough from regular cigarettes that existing federal and state laws do not cover them, and they are becoming big business for tobacco companies. Major industry players include NJOY, Altria, Lorillard and R. J. Reynolds.

The U.S. Congress, the European Union, the FDA and state legislatures from coast to coast are examining ways to regulate, tax, or ban advertising of e-cigarettes, a $1.7 billion industry in the U.S. and growing. Because these products generally contain no tobacco, they fall outside the jurisdiction of most traditional state laws regulating tobacco products. Legislation was introduced in almost every state in 2013 and Arkansas, Hawaii, Illinois, North Carolina and South Carolina passed bills, primarily addressing the sale and marketing of e-cigarettes to minors. Other states and municipalities have moved to more broadly regulate advertising or have added e-cigarettes to existing regulations banning indoor smoking in public spaces.

Failing swift action at the FDA we expect a major legislative push in the states in 2014 to regulate the fast growing e-cigarettes industry. Prompted by intense lobbying by health advocates some 40 state attorneys general have sent two letters to the FDA asking that they regulate e-cigarettes as they do tobacco and tobacco products. The New York Times has reported that a draft FDA rule, which is not public, has been sent to the Office of Management and Budget and the White House’s Office of Information and Regulatory Affairs for review.

E-cigarettes deliver nicotine in the form of water vapor. They are different enough from regular cigarettes that existing federal and state laws do not cover them, and they are becoming big business for tobacco companies. Major industry players include NJOY, Altria, Lorillard and R. J. Reynolds.

Opponents include public institutions like the Centers for Disease Control and Prevention and private advocacy groups like the American Lung Association.

Lawmakers are expected to examine who should be able to use the product; how it should be taxed; and how it should be defined in statute. The last question is perhaps the most important. State legislatures must decide if e-cigarettes should be designated as tobacco products or as something separate, with most leaning towards the former with an ‘alternative nicotine product’ designation. This will determine how they are taxed, and if they are subject to the same regulation including indoor bans most states have imposed on regular smoking materials.

Opponents include public institutions like the Centers for Disease Control and Prevention and private advocacy groups like the American Lung Association.

Lawmakers are expected to examine who should be able to use the product; how it should be taxed; and how it should be defined in statute. The last question is perhaps the most important. State legislatures must decide if e-cigarettes should be designated as tobacco products or as something separate, with most leaning towards the former with an ‘alternative nicotine product’ designation. This will determine how they are taxed, and if they are subject to the same regulation including indoor bans most states have imposed on regular smoking materials.

- See more at: http://congress.org/2013/12/12/states-look-to-tax-and-regulate-e-cigarettes-in-2014/?src=rcrr#sthash.7yJJoxT6.dpuf