Addicted to tax revenue: The potentially dangerous rush to raise the vaping tax
The state’s first vaping tax took effect on January 1, just nine weeks ago. On Thursday, the House approved a bill to more than quadruple it. But the revenue is unlikely to be the bill’s biggest effect.
House Bill 1699 raises the tax on the liquid used for e-cigarette vaping to 40% of the wholesale price. The current rate is 8% for open systems (fill your own) and 30 cents per milliliter for closed systems (cartridges).
On a 12-8 vote, the House Ways & Means Committee asserted that the increase was justified because of the potential negative health effects of nicotine contained in vaping liquid.
“The nicotine delivered by electronic cigarettes is a toxic addictive chemical derived from the tobacco plant,” Rep. Richard Ames, D-Jaffrey, wrote for the committee. “We know it is addictive. But we don’t yet fully understand the extent of the damage to vital human organs, particularly the lungs and heart, that may be caused by its inhalation through the vaping process. We don’t yet know its effect on the human brain, particularly its effect on the still developing brain of a young person.”
But nicotine researchers have repeatedly pointed out that nicotine should be treated as less harmful than tobacco smoking.
“We need to de-demonize nicotine,” Ann McNeill, professor of tobacco addiction at the Institute of Psychiatry, Psychology and Neuroscience at King’s College London, told Scientific American in 2015.
The reason is that switching from cigarette smoking to vaping produces dramatic reductions in health risks and has been associated with declines in tobacco use.
A study McNeil published in 2018 concluded that the health benefits of switching to e-cigarettes were so profound that e-cigarettes should be prescribed by doctors as smoking-cessation tools.
“When people smoke tobacco cigarettes, they inhale a lethal mix of 7,000 smoke constituents, 70 of which are known to cause cancer. The constituents in tobacco smoke that cause the harm are either absent or at much lower levels… in e-cigarettes so we are confident that they are substantially less harmful than cigarette smoking,” McNeil told the BBC.
“People smoke for the nicotine — but contrary to what the vast majority believe, nicotine causes little if any of the harm. The toxic smoke is the culprit and is the overwhelming cause of all the tobacco-related disease and death.”
The health argument being used for HB 1669 perpetuates the misconception that there’s little difference in the health risk between tobacco smoking and vaping.
In fact, there’s a huge difference, and a growing body of research shows that vaping helps smokers quit, leading to improved health outcomes. A study published in the New England Journal of Medicine last year found that e-cigarettes “were more effective for smoking cessation than nicotine-replacement therapy, when both products were accompanied by behavioral support.”
The presence of nicotine in vaping liquid plays a significant role in helping smokers make the switch from tobacco to less-harmful e-cigarettes. A 2016 National Institutes of Health study and a 2015 Society for Research in Nicotine and Tobacco study found that smokers preferred e-cigarettes with higher nicotine content, suggesting that e-cigarettes with higher levels of nicotine helped people quit smoking by offering a satisfying substitute for tobacco. E-cigarettes with lower nicotine levels were less effective.
Were the state leaving people alone to make their own decisions, the health outcomes would be a matter of individual choice. But in this case legislators are attempting to use the tax code for the express purpose of changing people’s behavior.
That puts the government on the hook for the outcomes. Given the strong link between vaping and smoking cessation, any government effort to discourage vaping would likely lead directly to worse health outcomes for smokers.
Because the research showing vaping to be an effective smoking cessation method is well publicized, skeptics might conclude that a more powerful motivation for such a tax would be the revenue. (As with nicotine, collecting and spending tax revenue can be habit forming.)
I am not and have never been a smoker or a vaper. In fact I can’t be around smoke because it gives me a headache immediately and more painful symptoms when I have (in the past), smelled it for longer periods of time.
When people expect the government to provide all their needs, they are really asking for government to make all their decisions. If you want government to provide your health care, they will also have the right to tell you that you can’t smoke, that you must eat certain food, that you must be vaccinated, what medical procedures or treatments you must or may have and which you may not have. The two go together.
I can’t believe that people really want the government to do so much for them. They are asking for things, apparently without realizing there are strings attached. Unfortunately, we all pay when government extends its tentacles into more and more of our lives, even when we are not the ones begging them to do so.
In my ideal world, no one would smoke or vape, but since I choose for myself, and others choose for themselves, that is not up to me, as long as they don’t force it on me.
But when people want to make their own choices and have others cover for the risk they are taking, and when that risk is tax-funded, it could be considered a legitimate function of government to intervene. Not that I agree with it, but once the government is involved in some way, it is only likely to get continually more involved, not less.
When politicians try to legislate for everyone, they are taking on a very serious responsibility, assuming they know more (about practically everything from the looks of it) than anyone else, but they will never have to pay restitution for their mistakes.
So, although I dislike fumes in the air, I think it is overstepping authority to use taxation, and thus benefit financially, from these kinds of legislative decisions. On the other hand, individuals should have to pay for their own choices, including health outcomes based on choices. If they have insurance, it is up to the insurance companies to assess the risk and charge accordingly.
Unfortunately, vaping of nicotine among our youth is rampant and a major health crisis – addicting a whole new generation who are being permanently injured by this trend. There are those that It is reported that 25% of high schoolers in NH vape nicotine is up dramatically since the studies quoted in this post were written. There is little doubt that if vaping had not been invented, there would be substantially fewer addicted children.
Addiction, according to Breathe NH, the American Heart Associations and others, can be addressed legislatively in three ways, through regulation, taxation and cessation. The current placeholder rate was put in as part of a budget bill last year and was obviously too low to prevent rampant addiction. That bill’s passage was important as it regulated this harmful product for the first time.
This new tax rate would take effect 9 months after the initial rate went into effect and will be pretty seemless to vape shop owners, should it become law. The products they purchase that contain nicotine will be more expensive. An item they previously paid $2.16 for ($2 manufacturing cost plus 8%) will in October arrive with a price tag of $2.80, the added amount which will presumably be passed on to their customers. Since the new rate is lower than all of the other states in the region and there is no sales tax to be collected or added, the NH shops will have a competitive advantage over other shops in New England. A previous product sold at $3.20 will probably now cost a nicotine person who vapes around $3.95. This difference is enough that it could be a deterrent for youth nicotine vaping, since most of these sales start as legal retail sales.
Of course, there are no taxes on the vaping hardware or vaping of items other than nicotine.
This is obviously only a small piece of the puzzle to protect our youth. It should be noted that this tax is lower than applied to cigarettes, so “leaving people alone to make their own choice” is really off the mark.
There are definitely people who have made their nicotine habits less harmful by responsibly using vaping products. There are many nicotine and smoking cessation products available, most of which are labelled by the FDA for that purpose. Hopefully certain vaping products will be labelled that way soon. But today, there are many more taking a dip in the nicotine addiction pool than are being dried off and cured of their addiction started by using nicotine vaping products. Unfortunately, most of them are children. A tax rate that was lower than the 9% tax rate for a tuna fish sandwich in NH and needed to be addressed.
Jerry Stringham, State Representative
Grafton County, 5th district