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DC budget would extend 70 percent tobacco tax to vapor products, e-cigarettes

By   /   May 11, 2015  /   No Comments

By Brad Matthews | Watchdog Arena

Although the issue has received little coverage in the local press, DC Mayor Muriel Bowser’s proposed budget for FY 2016 contained an interesting tidbit: a new tax on vaping and e-cigarettes. The Vapor Product Amendment Act of 2015 “results in ‘e-cigarettes’ being taxed at the same rate as ‘other tobacco'” according to the executive summary of Mayor Bowser’s budget.

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TOBACCO TAX PUT ON VAPING?: DC Mayor Muriel Bowser’s proposed budget for FY 2016 extends the current 70 percent tax on tobacco to vapor products, which would raise only $400,000.

Currently, the excise tax on cigarettes in DC is 70 percent of wholesale; this new budget would extend the same tax to e-cigarettes and other vapor products.

The DC Council had adopted this unified tax rate for all tobacco products in FY 2015, but medical research had not established enough of a consensus at the time to include e-cigarettes under the larger tobacco umbrella.

Since then, however, several national anti-tobacco organizations, “including the Center for Disease Control, the American Heart and Stroke Society, American Cancer Society Cancer Action Network, and the Coalition for Tobacco Free Kids, have determined that e-cigarettes have the potential to harm health,” reports the DC Fiscal Policy Institute.

Though the FDA has said vaping is less harmful than tobacco smoking, these new reports have empowered the mayor and the council to tax vaping at 70 percent.

The extension of the tobacco tax rate to vapor products will not raise all that much revenue for the city. The FY 2016 budget in total only adds $36 million in revenue, an increase of half a percent overall. The Vapor Product Amendment Act would only raise $400,000 for FY 2016, and would only raise $500,000 for FY 2017, according to DCFPI.

These pending changes have not, despite media silence, gone unchallenged. The Consumer Advocates for Smoke-Free Alternatives Association (CASAA) issued a call to action recently to oppose this particular item in the budget. CASAA seeks to inform the public that vaping is not like traditional, smoke-based methods of tobacco consumption, and that the health risks of vaping are less than that of smoking.

Individual members of CASAA and other opponents of the tax increase contacted various members of the DC Council and attended a budget oversight committee hearing on May 8 to express their views on the proposed tax increase.

CASAA’s Legislative Director Alex Clark spoke to Watchdog Arena on the subject. He told us that “any additional taxes beyond general sales tax imposed on vapor products are inappropriate and will only encourage existing smokers to keep smoking.  Moreover, attempts to achieve tax parity with combustible cigarettes will only serve to amplify the dangerously inaccurate message that these products are just as harmful as smoking.”

The DC government will use public health as the main impetus for this tax increase. Such a reactive policy, however, could unduly burden consumers of e-cigarettes–and prevent people who currently smoke from switching to a healthier, more pleasant alternative.

This article was written by a contributor of Watchdog Arena, Franklin Center’s network of writers, bloggers, and citizen journalists.


Brad formerly served as staff reporter for Watchdog.org.