By the numbers
.40 cents: Senate proposal to increase tax to $1.65 on a pack of cigarettes
$1: Gov. John Kasich's proposal to increase tax to $2.25
$18-$20: Average retail costs for 30-milliliter bottles of e-liquid
$33.75: Kasich's proposal for new tax on 30-milliliter bottles of e-liquid
Through their tax proposals, Ohio lawmakers seem to be saying that not all cigarettes are equal.
Vapor cigarettes, or e-cigarettes, are OK. Traditional tobacco cigarettes? Not so much.
Budget discussions are ongoing, but both the Ohio House and the Ohio Senate would say no to any tax increase for vapor cigarettes. Meanwhile, the Senate is calling for a 40-cent-per-pack increase in the cigarette tax, and Gov. John Kasich a $1 a pack increase. Kasich would also add a vapor cigarette tax, while the House would keep the state tax on cigarettes at $1.25.
Smoking has emerged as one of the key puzzle pieces that would allow lawmakers to lower the income tax for all Ohioans. But the various sides are far from any agreement, which must happen by the end of the month.
Kasich’s proposed cigarette tax would also apply to liquid nicotine, amounting to a $2.25 cigarette tax to be applied to every 2 milliliters of the liquid nicotine sold in Ohio, according to the American Vaping Association.
Electronic or e-cigarettes heat and vaporize an often-flavored nicotine-laced liquid, venting vapor and delivering nicotine to the user.
The Senate’s proposed two-year $71.3 billion budget package rejects Kasich’s proposed tax on liquid nicotine. Earlier this spring, the House rejected Kasich’s tobacco and e-cigarette or “vaping” taxes.
Kasich’s e-cigarette tax would have been a first nationally. Since then, Minnesota has become the first to tax e-cigarettes, while North Carolina’s new tax takes effect in July.
Ohio isn’t the only state with a Republican governor weighing tobacco tax increases. Nevada passed a $1-a-pack tax that goes into effect July 1, said John Schachter, a spokesman for the Campaign for Tobacco-Free Kids. Leaders in Kansas and Louisiana are also considering tobacco tax increases, he said.
Seeking revenue
Even in conservative states, tobacco tax increases are the least unpopular of an array of possible tax increases, Schachter said.
“Liberals and conservatives, all support the tobacco tax,” Schachter said.
Not only do tobacco taxes garner revenue, but they tend to discourage youths from starting to smoke, which over time saves state governments health care expenses, he said.
Every 10 percent increase in the price of cigarettes cuts cigarette use by three to five percent, and it cuts the number of young-adult smokers by 3.5 percent, according to the Campaign for Tobacco-Free Kids.
“We like to describe it as either a win-in or a win-win-win,” Schachter said. “If you can get the kids to not start (smoking), you can save on decades of health spending.”
Chris Voudris, co-owner of Vapor Haus e-cigarette retail shop on Watervliet Avenue in Dayton, believes a tax on vaping would harm his business. The idea makes him “uneasy,” he said.
“It would eventually close our doors,” Voudris said.
E-cigarettes are different from regular tobacco cigarettes and should be taxed differently, he said. They don’t pose the same dangers as conventional, tobacco-burning cigarettes, he said.
Advocates and retailers say battery-powered cigarettes are a tobacco-free tool that can ease the craving for nicotine without tar, burning ash and other harmful chemicals.
Skeptics and some public health officials, however, are concerned that nicotine, a controlled substance, is still being used and delivered, only in a form that may attract young users.
“Tobacco is taxed in a way to help make up for a lot of death and disease,” Voudris said. “When they tax e-cigarettes the same way, or in what they think is the same way, it’s apples and oranges.”
As of January 2015, Ohio’s $1.25 per-pack tax on conventional cigarettes ranked it 30th among the states, according to the Campaign for Tobacco Free Kids.
The Senate’s 40-cent increase would generate $406 million, of which $8 million would be invested in what the Senate said was the “largest investment in nearly a decade for tobacco cessation efforts.”
“E-cigarettes are not (part of it),” state Senate President Keith Faber, R-Celina, said Monday. “It’s still a new industry. We frankly had a discussion. The revenue numbers there are unstable to predict, and we are trying to find stability and predictability.
“And then the other side of it, frankly, is the science says e-cigarettes are safer — we are trying to balance that issue,” he added.
“We continue to talk with the legislature about a host of budget issues, but we don’t conduct those discussions through the press,” Rob Nichols, press secretary for Kasich, said Tuesday when asked for a reaction to changes the House and Senate have made to the governor’s tobacco tax proposals.
Gregory Conley, president of the American Vaping Association, an Medford, N.J.-based industry group, welcomed the Senate’s moves.
“We are thrilled to see that both the Ohio House (and Senate) committees have decided that vapor products should not be taxed like traditional tobacco,” Conley said. “These products are helping to create ex-smokers all over Ohio.”
Tim Homer is one of those ex-smokers. Homer, president of Synergy Home Care in Centerville, smoked conventional cigarettes for more than 30 years. He said vapor cigarettes helped him quit smoking tobacco.
The tax proposal from Kasich did not surprise him.
“Pretty much every state taxes tobacco in one form or another,” Homer said. “So this really doesn’t surprise me, that they’re looking at taxing it. It’s a multi-billion dollar industry.”
Any new tax would not deter him from using vapor cigarettes, he also said.
“The reason why I’m using the vapor cigarettes is to not smoke regular cigarettes — and to some day not use e-cigarettes either,” Homer said.
Staff Writer Lynn Hulsey contributed to this story.
About the Author
