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A New Proposed Federal Tax on Vaping Products

A New Proposed Federal Tax on Vaping Products

Biden’s Build Back Better Act has seen a lot of debate over the last few months among congressional Democrats, and while there’s been a lot of media focus on the President’s “social infrastructure plan” and its funding, a bit of legislation has snuck its way in that directly affects the vaping industry.  A proposal to tax blanket nicotine products had initially been added in and then removed, but since then, a modified version of the proposal has entered the picture which would exclusively tax vaping products and nicotine pouches, leaving the cigarette industry completely alone.

What is the Current Situation?

As it stands, the proposal would result in vaping products being subjected to tax rates higher than those of cigarettes, which would understandably have major impacts on both vaping businesses and vaping consumers.  House Budget Committee Chairman John Yarmuth is responsible for bringing the nicotine tax proposal back to life, after another potential source of tax revenue was removed from the overall plan, which would have increased taxes on Americans earning more than $400,000 per year.

As of now, the White House has not shown any signs of objecting to this nicotine tax, which is concerning to the vaping industry, to say the least.  Congressional Republicans have vocally rejected the BBB bill, which means that its only hope of passing is through the budget reconciliation process. The bill was just passed by the House on November 19th, and is now headed to the Senate. Only a few Democratic senators have outwardly opposed the tax on nicotine products thus far.  All that’s needed is one Democratic senator to remove the proposal from the overall bill.  Those who currently do not support it are Senators Joe Manchin from West Virginia, Catherine Cortez Masto from Nevada and Kyrsten Sinema from Arizona.  None of them have gone further to work towards the removal of the proposal, but if their constituents were to reach out to them, perhaps they would be more proactive.

That doesn’t mean that only those who live in these three states have a chance of making change.  We can all spend this time contacting our elected officials and urging them to remove the proposed nicotine tax from BBB.  And, time is running out to do so, with the vote taking place in just a few days.  This is why we must urgently ask that our readers begin reaching out in any way that they can.  This doesn’t just hurt vaping companies like us, but it will hurt anyone who purchases vaping products.

It’s interesting to point out that the proposal would add an estimated $10 billion to federal revenue, which falls incredibly short of the goal of $1.75 trillion.  In other words, vaping taxes would not provide significant enough revenue to the Federal Government to justify the imposition on the vaping industry.

What the “Nicotine Tax” Entails

Federal Vape Tax

Presentily, the vaping industry exists in a way that is inclusive.  Low and middle-class individuals can generally afford vaping products, which are not subjected to the extraordinary taxes placed on cigarettes.  But, that could all very well change, sooner than you may think.

The proposed nicotine tax found in the Build Back Better Act would serve as the first federal tax on vaping products and nicotine pouches.  In short, manufacturers would be taxed $50.33 per 1,810 milligrams of nicotine, which comes out to about 2.8 cents per milligram.  This would affect all vaping products, but especially those with salt-based nicotine, as the higher nicotine concentrations would cause prices to skyrocket.  For reference, this would mean that a 30ml bottle of 50mg salt-based vape juice, which is somewhat standard among users of open pod systems, would cost an extra $42.

Excise states have already implemented a tax on vaping products, such as California, Illinois and many others. Here, state taxes would inevitably rise in response to the increased federal tax, as these state taxes are based on manufacturing costs. 

The vaping industry is largely made up of businesses who have worked extraordinarily hard to comply with ever-changing rules and regulations set forth by government agencies. Recent carrier restrictions have already harmed a lot of businesses, as did the notorious FDA-developed PMTA process that required vaping companies to scramble for FDA approval with little warning. This tax would almost certainly destroy many vaping businesses across the country. Meanwhile, customers who find themselves paying outrageous taxes on vaping products may very well find themselves switching back to cigarettes, all while health economists have outspokenly supported vaping as an alternative.  Interestingly, many of these health economists have been outspoken against federal vaping restrictions in recent years.

All the meanwhile, experts are hinting their suspicions that these taxes would directly benefit the tobacco industry, and that may not be a coincidence.  Making vaping more expensive than cigarettes seems like an unnecessary step, and the removal of increased taxes on cigarettes has certainly raised a number of eyebrows.

What Needs to Be Done

Time is running out to stop Congress from passing this nicotine tax proposal as part of the Build Back Better act, but that doesn’t mean that you can’t make a difference between now and the day of the vote.  We ask you to please reach out to elected officials now, in hopes of influencing their decision-making over the next few days.  In short, this proposal would damage the vaping industry beyond repair, and directly, permanently interfere with your ability to continue purchasing vaping products.

CASAA has made it as simple as possible to allow your voice to be heard. 

CLICK HERE to take action now!




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- May 09, 2023

I appreciate the generated letter so I just had to include my personal information. It was sent to my Minnesota State Senator.

Ruby A Slagle

- May 09, 2023

Thank you for keeping us updated

A Young

- May 09, 2023

This is a used as a SAFER way for people to quit smoking and should not be taxed MORE!!! People can drink and become alcoholics and that is legally fine. In many states they can buy and use marijuana. Using e-liquid is an anti-smoking cessation method that should be available to adults without penalties!!

Thomas Bedsworth

- May 09, 2023

Another tax on the poor

Almon E Smith

- May 09, 2023

Biden said he would tax the wealthy to fund his projects. But over and over he never sticks to his word. After smoking over 40 years vaping has changed my life. I hope the goverment dont tax it were I cannot afford it.Stand Up For Poor People!

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