This week, JLF’s Mitch Kokai commented on the recent efforts by the NC General Assembly to increase taxes on e-cigarettes for the Winston-Salem Journal. The article’s author, Richard Craver, explains:
An amendment to Senate Bill 557 submitted by state Rep. Gail Adcock, D-Wake, in the House Finance Committee would have taxed vaping products at the same rate as traditional cigarettes.
The current excise tax on vapor products is 5 cents per fluid milliliter of consumable product — a much lower rate supported by tobacco manufacturers when the law was passed during the 2014 legislative session and took effect in February 2015.
By comparison, the excise tax on a pack of traditional cigarettes is 45 cents, one of the lowest rates in the country.
The measure, however, was ultimately not included in the bill. It has, however, sparked a conversation about raising excise taxes on e-cigs, and many are not convinced. The story reads:
David Sweanor, an adjunct law professor at the University of Ottawa and the author of several e-cigarette and health studies, argues that “here is a huge difference in risk between different nicotine products, and tax and regulatory policies should encourage consumers to move away from lethal combustible cigarettes.”
“Anything that narrows the price difference between cigarettes and vaping discourages substitution (and) is helpful to the cigarette business, but perpetuates a public health catastrophe,” Conley said.
JLF’s Mitch Kokai is not sold on the idea either. Craver writes:
Mitch Kokai, senior policy analyst with the libertarian-leaning John Locke Foundation said lawmakers should approach increasing the vaping excise tax “with skepticism and caution.”
“A good rule of thumb is that if you want less of something, you tax it,” which is why anti-tobacco advocates overwhelmingly support higher state and federal excise taxes, Kokai said.
“Advocates of this approach want to treat e-cigarettes in much the same way as state government treats traditional cigarettes. That shouldn’t surprise us,” he said. “If you’re accustomed to using a regulatory hammer, then every new challenge starts to look like a nail.
“They also want to create a new fund — overseen by government bureaucrats — to deal with the tax revenue,” Kokai said.