Nicotine Tax Is Dead (For Now Anyway)
The nicotine tax that passed the House of Representatives as part of the Build Back Better Act has now been dropped from the version of the bill being considered in the Senate. But until the bill actually passes without the tax, it could be added again.
The Wall Street Journal reported Thursday evening that Nevada Senator Catherine Cortez Masto, a Finance Committee member, pushed for the tax to be deleted from the almost $2 trillion legislation. The nicotine tax would have provided about $9 billion in revenue over 10 years—essentially a drop in the bucket of revenue needed to fund the huge spending bill.
“I have been clear from the start of this process that I would not raise taxes on anyone making less than $400,000, and I would not support measures that hurt Nevada’s small businesses, farmers and ranchers, or the more than 30,000 men and women whose jobs are supported by the mining industry,” Sen. Cortez Masto said in a statement.
Senate Finance Chairman Ron Wyden confirmed Thursday that the tax had been dropped from discussions, according to Bloomberg Tax.
There is no federal tax on vaping products, although many states have vape taxes. The tax just dropped from the BBB bill is one of several “tobacco tax equity (or parity)” bills that have been proposed in recent years, supposedly intended to equalize tax rates on all consumer nicotine products.
During the BBB bill’s journey through congressional committees, members of Congress removed and then added back the nicotine tax. It is not beyond the realm of possibility that it could reappear still before the bill received a Senate vote. That’s why CASAA is urging vapers to continue educating lawmakers by participating in the group’s call to action.
Read our previous coverage of this and other “tobacco tax equity” legislation
Nicotine Tax Passes House, Must Be Stopped in Senate (Nov. 19, 2021)
Urgent! Tell Congress to Kill the Outrageous Nicotine Tax (Nov. 3, 2021)
Nicotine Tax: Vapers Apply Pressure & Some Democrats Have Doubts (Sept. 15, 2021)
Democrats’ Proposed Vape Tax Would Violate Biden Campaign Pledge (Sept. 14, 2021)
Study Says Durbin’s Tax Parity Bill Would Increase Youth Smoking (Sept. 1, 2021)
Durbin Introduces Bill to Tax Vapes Like Cigarettes (April 23, 2021)
Outrageous Nicotine Tax Bill Passes House Committee (Oct. 25, 2019)
Image courtesy YouTube
This is great news Jim, I’m so happy! Let’s hope and pray it stays out now.
This is fantastic news for the one company that can legally sell tobacco vape products! (slow clap)
Jim,
Can you explain the following comment? “The tax being discussed now is one of many “tobacco tax equity (or parity)” bills that have been proposed in recent years, supposedly intended to equalize tax rates on all consumer nicotine products.” Is this a bad thing or is it better than having the nicotine tax in the BBB bill? I’m a bit confused on what this means.
Thanks for answering and explaining.
David
I was referring to the nicotine tax that was removed from the bill, but I see how that might not be clear (I’ve edited the article to clarify). It (theoretically) is meant to tax all consumer nicotine products federally at the same rate. That is a terrible idea, since it removes the incentive to switch from the most dangerous product (cigarettes) to the least (non-combustible nicotine products).
Thank you, appreciate the explanation.