Legislative Overview: Electronic Cigarettes

By Danny Restivo, DMGS

In May the Food and Drug Administration expanded tobacco regulations to include electronic cigarettes. Many have hailed the product as a smoking cessation tool, while others see it as a gateway into nicotine addiction or potentially worse. As officials debate the benefits and hazards of e-cigarettes—which uses battery power to deliver liquid nicotine in the form of vapor—a sizable market has emerged. According to a 2014 study by the Centers for Disease Control, 12.6 percent of adults say they have used an e-cigarette, with use highest among 18-24 year-olds. Meanwhile, additional data released by the CDC in 2015 shows e-cigarette use tripling among middle school students, from 120,000 to 450,000 during 2013-2014. A large number of state and local laws prohibit the selling of e-cigarettes to anyone under 18, but the FDA’s regulations apply to every state.

The FDA’s regulation also places the $3.7 billion e-cigarette, or vaping, industry into the same regulatory category as tobacco, a competing market valued at roughly $95 billion. As a result, e-cigarette owners are stuck in a two front tug-of-war between the FDA and the tobacco industry. E-cigarette producers are now asking why they should face the same regulatory scrutiny when evidence suggests their product may be less hazardous compared to cigarette smoke. A 2014 study commissioned by the United Kingdom’s health agency shows electronic cigarettes are 95 percent less harmful than traditional cigarettes. While the e-cigarette industry tries to separate itself from the tobacco industry in the eyes of U.S. regulators, the FDA’s mandate can now buttress arguments for taxing e-cigarettes like tobacco products.

In November, California voters will go to the ballot and decide on proposition 56. If approved, the law would increase a cigarette tax from 87 cents to $2, which will extend to e-cigarettes. If voters enact this measure, California would join five other states with taxes on e-cigarettes, including Kansas, Louisiana, Minnesota, Pennsylvania and North Carolina.

In October, the Pennsylvania legislature approved a tax on all tobacco and e-cigarette items. Vendors now face a tax rate equal to 40 percent of the wholesale price on all e-cigarette items, making $15 e-cigarette products $20. Conversely, traditional tobacco cigarettes may increase by $1.60 per pack. Keystone state store owners who sell e-cigarette products are now trying to substitute the wholesale tax with a 5-cent-per-milliliter retail tax on vapor liquid. The 5-cent tax is similar to legislation North Carolina Governor Pat McCrory signed into law in May 2014. However, since the state legislation originated before the recent FDA regulations, traditional cigarettes received a more burdensome excise compared to vaping products.

In an effort to fill a $400 million budget deficit, Kansas legislators approved a package of tax increases, which included an excise on all tobacco and e-cigarette products. The law placed an additional 50-cent charge on cigarette packs, as well as 20-cent per milliliter on all vaping liquids. Meanwhile, both Louisiana and Minnesota have laws that regulate e-cigarettes the same as tobacco products.

While they haven’t implemented a tax, Indiana approved questionable regulatory policies that led the FBI to question state leaders in August. The Hoosier state’s e-cigarette law, which was signed by Governor Mike Pence in April, stipulates manufacturing guidelines for e-cigarette producers. Among the regulations was a guideline requiring a company that produced e-cigarette items to have a certification by a security company by June 30, 2016. However, based on the state guidelines for those security companies, there was only one available company that met the laws standards. Since then, only six e-cigarette companies, among a large number of available producers, have been approved to sell their products in Indiana. In essence, the new regulatory policy has created an oligopoly on e-cigarettes in the Hoosier state. The FBI has not confirmed the investigation, but several lawmakers have admitted they were questioned by agents.

While five states have passed tax policies regarding e-cigarettes, seven others—including California, Connecticut, Delaware, Hawaii, Maine, New Jersey and North Dakota—have all placed restrictions on the use of e-cigarettes in public. Most of these state regulations prohibit e-cigarettes in workplaces, bars, restaurants and other public places, treating it the same as smoking tobacco in public places.

In some states, local laws have come into conflict with the state’s categorization of vaping. In February, following a case in which an e-cigarette user was on a subway platform, a New York court ruled that e-cigarette users can’t be charged with violating the state’s anti-smoking laws because it’s not the same as smoking. The ruling read that smoking is “the burning of a lighted cigar, cigarette, pipe or any other matter of substance which contains tobacco,” whereas “An electronic cigarette neither burns nor contains tobacco. Instead, the use of such a device, which is commonly referred to as ‘vaping,’ involves ‘the inhalation of vaporized e-cigarette liquid consisting of water, nicotine, a base of propyleneglycol or vegetable glycerin and occasionally, flavoring.’ This does not fit within the definition of ‘smoking’ under the law.” While the city’s anti-smoking ordinance does extend to vaping, the police officers who arrested the e-cigarette user charged him under the state code as opposed to the city code. Since the incident, the New York State assembly is attempting to amend the law to include e-cigarettes.

In Kentucky, smoking in certain establishments is permitted, but Louisville approved anti-smoking ordinances in workplaces and public spaces in 2008. However, the law did not specify e-cigarettes. During recent public forums on whether to extend the ordinances to include e-cigarettes, supporters of the ban cited research from public health organizations as evidence of the harmful effects of vaping in public. Critics of the extension point to other research that shows vaping’s ability to help smokers kick the habit, therefore improving public health.

As the FDA takes a larger role in regulatory oversight of e-cigarettes, state’s may perceive vaping the same as traditional cigarette smoking. Early research from various public health organizations has provided a mixed bag of evidence regarding the harmful impacts of e-cigarettes. However, as the popularity of vaping grows, cities and states will have to decide whether to treat vaping as a public health hazard, or a beneficial tool.

For more information on e-cigarettes and smoking laws for each state, check out the interactive map from the Public Health Law Center.















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