Michigan’s Tobacco Overhaul Bill Misses the Mark on Harm Reduction

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Key Points:

• Bill Overview: Michigan Senate Bill 582 seeks to overhaul the state’s Tobacco Product Tax Act, regulating and taxing all tobacco, nicotine, and vapor products under a single framework.

• New Categories: Creates definitions for “alternative nicotine product” (e.g., pouches) and “authorized vapor product” (those with or pending FDA orders).

• Major Restriction: Would ban sales of any vapor product lacking FDA authorization – effectively eliminating most e-cigs from the market.

• Tax Hike: Imposes a 32 percent wholesale tax on vapor and nicotine pouch products, matching combustible tobacco.

• Winners & Losers: Benefits a few major manufacturers; harms small businesses and restricts consumer choice.

• Usage Data: 8.5 percent of Michigan adults (674,000) vape – up 1.2 percent from 2022; youth vaping fell 26 percent since 2019. For every high school student vaping in 2023, more than nine adults were.

• Compliance: FDA found 21.7 percent violation rate in 2024–25 inspections – most violations involved cigars, not vapes.

• Fiscal Misalignment: Michigan collected $932.4 million in tobacco revenue in 2023 but spent just $1.8 million (less than $0.01 per dollar received) on prevention and cessation.

• Policy Implication: Instead of taxing and banning reduced-risk products, lawmakers should reinvest tobacco revenues in education, cessation, and harm reduction.

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Michigan lawmakers are once again targeting adult access to smoke-free nicotine alternatives.

Senate Bill 582 would amend the Great Lakes State’s Tobacco Product Tax Act to overhaul Michigan’s taxation, regulation, and enforcement of tobacco and alternative products, including nicotine pouches and vaping devices. While the proposed legislation appears to modernize state efforts to regulate newer nicotine products, it would severely harm small Michigan businesses and unfairly punish adults who have used tobacco harm reduction products to quit smoking.

The bill aims to create a unified, statewide regulatory and tax structure for tobacco, nicotine, and vapor products, bringing so-called parity among all product types. It would create new categories – “alternative nicotine product,” defined as a non-tobacco/vapor product such as nicotine pouches, and “authorized vapor product” or “authorized consumable material,” referring to vapor products that have received (or have a pending) marketing order from the U.S. Food and Drug Administration. Other changes include expanded definitions for tobacco products, cessation products, and nicotine delivery systems. Notably, the legislation would make it illegal to sell any vapor product that has not received FDA marketing authorization.

SB 582 would also impose an excise tax of 32 percent of the wholesale price on both alternative nicotine and authorized vapor products, taxing them in the same manner as traditional tobacco. The legislation further strengthens enforcement by imposing felonies for large-scale trafficking or possession of illegal products and expanding civil fines and retailer bans to the vapor sector.

In effect, Senate Bill 582 would eliminate most e-cigarette products while benefiting a handful of large manufacturers. To date, the FDA has authorized only 39 e-cigarette products from four companies and just 20 oral nicotine products from a single manufacturer. Legislation recognizing only these products would unfairly target Michigan’s small businesses and limit consumer choice.

According to the Centers for Disease Control and Prevention, in 2023, 8.5 percent of Michigan adults – or 673,655 adults – used e-cigarettes, a 1.2 percent increase from 2022. At the same time, youth use has decreased. Between 2019 and 2023, the percentage of high school students who were currently using an e-cigarette decreased by 26 percent. And there are far more adults using e-cigarettes: in 2023, for every one high school student currently vaping, more than nine adults were.

Retailers, especially specialty vape and tobacco shops, are largely complying with age restrictions. Between January 1, 2024, and August 29, 2025, the FDA conducted 4,963 inspections in Michigan, citing 1,077 violations (a 21.7 percent failure rate). Nearly half of all violations involved cigar sales (490), while only 312 involved e-cigarettes. Among specialty shops, just 232 retailers were cited. Instead of imposing sweeping bans and excessive taxes, lawmakers should work with federal and local agencies to strengthen compliance and remove bad actors – without punishing responsible retailers or adult consumers.

A more effective policy would be to invest existing tobacco revenues in prevention and cessation programs by utilizing already existing tobacco monies. In 2023, Michigan collected $932.4 million in tobacco-related monies, including $640.1 million from cigarette taxes alone. Yet, during the same year, the state allocated only $1.8 million on tobacco control efforts including cessation programs and support, education, and youth prevention efforts. Essentially, for every $1 the Great Lakes State received in tobacco monies, it spent less than $0.01 on programs designed to prevent and/or eliminate tobacco use.

As lawmakers debate regulation of tobacco alternatives, it is imperative that they avoid restricting adult access to proven harm reduction tools. Between 2016 and 2023, adult vaping in Michigan increased 73.5 percent, with many adults using these products to quit smoking. Rather than discouraging their use through bans and taxation, policymakers should promote them as a safer alternative to cigarettes.

Nothing in this analysis is intended to influence the passage of legislation, and it does not necessarily represent the views of Tobacco Harm Reduction 101.