A Tale of Tobacco Taxation: How Will Vaping Be Affected By California’s Prop 56?

A Tale of Tobacco Taxation: How Will Vaping Be Affected By Californias Prop 56?

If you think cigarettes just keep getting more and more expensive, you’re not imagining it. The latest federal hike in the tobacco tax came in 2009 with the passage of the Children’s Health Insurance Program Reauthorization Act. The tax jumped from 39 cents a pack all the way to $1.01 a pack.

 

The cost of a pack of cigarettes also includes state taxes. These range from just 17 cents in Missouri all the way up to $4.35 per pack in the state of New York. Altogether, federal, state, local, and sales taxes make up 56.6% – over half the average cost of a pack of cigarettes.

 

Whats the Point of a Tobacco Tax?

 

The purpose of taxing tobacco is twofold: the first objective, of course, being to generate revenue for the federal and state governments. The second purpose is more noble, however. Studies show that the more tobacco is taxed, the more smoking rates decrease. Simply put: if people can’t afford to smoke, they’ll give it up.

 

This is particularly true among young smokers. Research has proven that for every 10% increase in a pack of smokes, the youth smoking rate falls by nearly 7%. It also applies to minority and low-income smokers. Every time there is a bump in the tobacco tax, cigarette quitting hotlines are inundated with calls.

 

Case in Point: California

 

In the fall of 2016, California voters approved Proposition 56, legislation that included a $2-per-pack cigarette tax increase – the largest hike since the state first started taxing tobacco nearly 60 years ago. The tax kicked into gear in April, sending a pack of cigarettes skyrocketing from an already-pricey almost $6 per pack to an astronomical $9.

What was the effect of the increase? Just before the law went into effect, sales of tobacco soared due to people running out and stocking up. In March, tobacco tax revenue was up to a whopping 37% higher levels than from a year before. From April to May, tobacco tax revenues (and cigarette sales, by default) plummeted.

 

How far did it drop? A government analyst expected a drop of around 20 to 30%. In reality, cigarette tax revenue measured at a stunning 64% lower in May 2017 than one year before. While some suspect the drop is due to consumers smoking up their stocked-up cigarette supplies, public health advocates express optimism that the drop is a positive sign of things to come.

 

“I have felt for a long time where we’re getting to the point in California where smoking is so low that a couple of good shoves like this one, and we might be rid of it,” Dr. Stanton Glantz, a researcher at UCSF’s Center of Tobacco Control Research and Education, told KQED News.

 

On July 1, the increased tax rate went into effect for all “tobacco products” besides cigarettes. These include little cigars and other forms of tobacco, as well as “nicotine intended for human consumption.”

California Vaping Gets Caught in the Net

 

That last bit means that unfortunately, when voters approved Prop 56, they also voted to penalize people who vape. The bill includes a tax increase on all nicotine-containing e-juice. (Non-nicotine e-juice is not subject to the tax.) The increase also targets “nicotine delivery devices” including electronic cigarettes, e-cigars, e-pipes, vape pens, and e-hookahs if they are sold in combination with substances that contain nicotine.

 

When many people stop smoking tobacco cigarettes, they often rely on e-cigarettes and other vaping devices as a healthier alternative. The Royal College of Physicians of London even published a report promoting e-cigarettes as an excellent substitute for cigarettes. With the passage of Prop 56, California has become one of only six states to tax vaping devices and e-juice along with tobacco.


Potential  Effect on Vaping?



As with the real impact on the rate of smoking, the effect of Prop 56 on vaping in California won’t be known until more time has passed. From small mom-and-pop vape shops to individual consumers, it’s likely that the results won’t be good. The legislation even has the New York Times asking “Who Wins If California Voters Tax E-Cigarettes?

The likely answer: no one.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Recent Posts

Making the Switch Will Take Some Time and Effort

Disposable vs. Rebuildable Vape Tanks

Vaping Cleanliness: Vape Tanks

A QUICK LESSON IN WICKS/WIRE/COILS

Quick Tips to Deal with Vaper's Cough


Tags

1ohm 5 sesnes advice airflow atomizer atomizers authentic back and forth batteries battery benefits better alternative bitter Blueberry Muffin body bottles building builds cartridge chargers safety charging choice Cinnamon Bun cities clean cleaning clearomizer clone cloud chasing clouds coil coil building coil e-liquid coils control cotton cough dehydration Denver device devices differences disposables Dollar E-Juice Club drippers dry hits e-cigarette e-cigs E-Juice e-juices e-liquid e-liquid differences e-liquids effects electronic cigarette electronic cigarettes events expiration extra facts Fall faulty unit fda fill line filling flavor flavors glass hardware hearing how it works humid conditions inhaling inhaling and exhaling issues juice keeping cool Las Vegas leakage leaking leaks levels maintenance media MOD modders modding MODs nicotine O-rings Ohm’s Law overflow parts Passion Berry PG/VG PG/VG ratio PG/VG ratios plastic Pod MODs power pre-built coils preference prepping preventing priming pulls Pyrex RBA RDA RDA RDTA RDAs reactions rebuilables rebuildables refilling refrigeration remedies safety Seattle seeing smell smoke smoking solvents spares spilling spills steep steeping steps storage Strawberry Lemonade sub-ohm sub-ohm tanks sub-ohm vaping sub-ohming success Sugar Cookie summer summertime Sweet Tobacco switching Tampa tank tanks tasting TC MODs techniques temp temperature temperature control Thanksgiving The Dollar E-Juice Club thinning throat hit tips tools touch trends Tropical Juice types Vanilla Custard Vape vape hardware vape juice vape juice PG/VG ratio vape juices vape tank vape tanks vapers vapes vaping vaping tips vapor vapor production vapor water Vapor4Life Virginia Beach watt wattage wick wicking wicks wicks vaping wire wires working workout workplace


Leave a comment