The higher tax rate was approved last year and would go into effect in July 2022. Meanwhile, a proposal to reduce the tax from 25% to 15%, was approved by the Republican-dominated state Senate last month. The tobacco harm reduction advocates in favour of the proposal argue that the higher tax rate would drive vapers who are former smokers back to smoking.
However last week, anti-vape entities urged a House committee to keep the 25% rate, saying they believed vape devices should carry the same tax rate as cigarettes in order to discourage young people from using them.
Do taxes work?
Meanwhile, a recent study published in the Journal of Risk and Uncertainty looking at the effects of traditional cigarette and e-cigarette tax rates on adult tobacco consumption rates, found that increased tax rates on vaping products are directly proportional to increased smoking rates.
The study titled, “The effects of traditional cigarette and e-cigarette tax rates on adult tobacco product use,” analysed the effects of taxes on traditional cigarettes and vaping products, on use patterns of these same products among adults in the United States. The researchers examined data from the Behavioral Risk Factor Surveillance System and National Health Interview Survey (NHIS), over the period from 2011 to 2018.
The research found evidence that higher taxes on traditional cigarettes reduce adult smoking and increase adult e-cigarette use. Similarly, higher e-cigarette tax rates increased traditional cigarette use and reduced vaping.
“Cross-tax effects imply that the products are economic substitutes. Our results suggest that a proposed national e-cigarette tax of $1.65 per millilitre of vaping liquid would raise the proportion of adults who smoke cigarettes daily by approximately 1 percentage point, translating to 2.5 million extra adult daily smokers compared to the counterfactual of not having the tax,” read the study Abstract.
Read Further: Wishtv.com
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