Senate Committee Grapples With E-Cigarette Taxes

A Senate panel is grappling with how – and how much – to tax electronic cigarettes.

Health advocates say such a tax is important because of the growing use of e-cigs among young people – a 78 percent increase last year, says American Cancer Society’s Bryan Hannon.

“And I would say that this increase in youth use isn’t necessarily a glitch. I think this is really by design," Hannon says. "These products – especially the bigger products on the market – are owned by tobacco companies and they’re using the same playbook that they used decades ago with cigarettes.”

Hannon wants e-cigarettes taxed based on the price of sale – not based on the e-liquid amount, as the bill currently does. And he says he’d like to see a rate similar to the tax on regular cigarettes.

But vape shop owners oppose the bill. Indiana Smoke-Free Alliance President Amy Netherton, who represents some of the state’s e-cigarette sellers, says e-cig taxes will hurt local retailers.

“Customers just simply cross into the neighboring states to gain access to the products that were either cheaper or available in other states,” Netherton says.

A Senate committee will consider amendments to the bill and vote on it as early as next week.