Taxes and Regulations on Vape Products Hurt Consumer Choice

American consumers face many obstacles if they wish to purchase an e-cigarette or vape product. From unnecessarily high government taxes to restrictions and outright bans, manufacturers must navigate a maze of federal, state, and local taxes and regulations, in order for consumers to acquire safer products of their choice, according to a new report by the American Consumer Institute (ACI).

While it is certainly true that using tobacco products of any kind is risky to your heath, it is also known that e-cigarette and vaping products are considerably significantly less harmful than traditional ignited cigars and cigarettes, according to the preponderance of evidence revealed in the new ACI report.

The report reviews dozens of studies and finds that these alternatives to smoking a fare safer –ninety-five percent less harmful than ignited tobacco products, according to the UK government’s Public Health England. A study published in the New England Journal of Medicine found that e-cigarettes were twice as effective in getting smokers to quit, compared to nicotine replacement therapies. Georgetown University Medical Center found at as many as 6.6 million smokers could extend their life if switched from cigarettes to e-cigarettes.

Despite the overwhelming evidence that e-cigarettes can save lives, the FDA has become a roadblock due to the current application process for approving new vape and e-cigarette products, having approved only one product so far.

Since September of 2020, all companies that manufacture or distribute flavored cartridge-based e-cigarettes must first receive authorization from the FDA. Last October the Food and Drug Administration (FDA) announced that it had authorized the marketing of the Vuse product line through its Premarket Tobacco Product Application (PMTA) pathway program, stating that R.J. Reynolds demonstrated appropriate “protection of public health” for its products. Moving at glacier speed, the FDA has not approved another product.

For these reasons, it is hard to understand why the federal government currently groups all tobacco products together with little regard the large variation of products and their effects on public health. The federal government need not determine whether such products are good for public health, but rather determine what leads to the greatest “harm reduction” for society.

For instance, 30 states and the District of Columbia impose some kind of excise tax on vaping products, with that number likely to grow in the future. However, the level of taxation varies by state, as does the how the tax is levied, and whether or not the state has a sales tax. Many states view such taxes as an easy way to shore up needed tax revenue without enduring more costly political battles.

Collectively, each of these rules add to a complex web of federal, state, and local regulation that the manufacturer must navigate in order for the consumer to enjoy true freedom of choice. Meanwhile, consumer prices rise and so does the demand for an illegal and unsafe underground market, where consumers can find cheaper knockoff vapes, but risk buying adulterated products, as was the case with the tainted products that caused the EVALI lung injuries two years ago.

The goal and effectively taxation of cigarettes as a public policy is entirely misplaced. Another study found a one percent increase in e-cigarette prices would lead to a one-half percent increase in cigarette sales – thereby producing poor health outcomes for consumers. Conversely, that study showed that a one percent increase in cigarette prices would lead to more than a one percent increase in e-cigarette sales – leading to a public policy that would encourage smokers to switch to safer products.

Why would policymakers ignore the overwhelming empirical evidence? Why would policymakers impose taxes that would deter cigarette smokers from switching to safer alternatives? Why would they seem policies that could jeopardize the lives of millions of Americans? Putting American lives at risk is exactly the outcome to expect when onerous government regulations, restrictions, bans and taxes target e-cigarette products.

Reforming regulations, cutting taxes, and protecting against teen use is a much better strategy for promoting the general welfare of American consumers.

Nate Scherer and Steve Pociask wrote this for the American Consumer Institute, a nonprofit education and research organization. For information about the Institute, visit www.TheAmericanConsumer.Org or follow us on Twitter @ConsumerPal.