Washington Vapers Taxed Into Submission
When a government, either state or federal, does not like a product or service it is common for that product or service to be taxed out of existence. Under this pressure the product will either fall by the wayside and cease to exist or it will make insane amounts of money for the government. Such is the case for ecigs in Washington State. While Washington has already placed bans on vaping anywhere smoking is prohibited, they are now moving a new direction that is sure to inhibit business growth. The political leaders in the state are now preparing to levy a 95% tax on all forms of ecigs and ecig paraphernalia.
The state leaders are arguing that this tax is needed because the ecig industry is leading teens to believe that their product is safe. To be clear, no legitimate ecig business is going to say that their product is 100% safe. While the public at large is vastly undereducated about ecigs, this does not mean that taxation is the answer. Instead of helping the public to better understand the benefits of vaping and the possible issues that might arise from vaping, the government is essentially trying to tax the issue out of existence.
However state Rep. Gerry Pollet, a Democrat and the sponsor of this bill, feels differently. “Many people, particularly teenagers, are being misled into believing these items are safe. You deserve to know what toxic and carcinogenic chemicals are in e-cigarettes.”
Taxation is not a new form of threat or punishment for products or services. However it is one of the most potent. In a recent interview Ohio Governor John Kasich said that he would be interested in signing a bill that would add a $33.75 tax to a 30 milliliter bottle of nicotine. That would triple the price of the product and thus cause the overall price of the ecig to rise. It is a shrewd but effective tool in the government tool belt that helps ensure the success and the failures of the companies that they choose.
There are 41 states that have already passed legislation that prohibits the sale of ecigs and ecig products to minors under the age of 18. However the state governments as well as the federal government are contemplating bans on flavored e-liquids saying that these are targeting minors. Flavors such as chocolate and bubble gum are said to be directly aimed at children and lawmakers want to see them disappear.
The bill that is being considered in Washington will take the conversation a step further. This bill will seek to end Internet sales, remove flavorings, and to force the companies to list all ingredients on the label. Critics of this bill will point to a loss of free market approach in business. They will also point out that most e-juice contains only 4 ingredients. Those four ingredients would be propylene glycol, vegetable glycerin, nicotine, and flavoring.
The bill is expected to come to the floor of the senate within the next few weeks. If the bill does pass the senate it will face a much stiffer road into the republican led house.
What are your thoughts on this entire process? There are obviously real benefits to understanding what is in a product you use, but does that mean the government has the right to tax you into submission? Should eliquids face tax hikes?