VAPING TAXES DO NOT DETER YOUTH USE OF E-CIGARETTES

April 4, 2019

KEY POINTS:

  • Heartland’s State Government Relations Manager Lindsey Stroud examines the effects of Pennsylvania’s 2016 40 percent wholesale floor tax on youth use of e-cigarettes.

  • According to the 2015 Pennsylvania Youth Survey (PAYS), 15.5 percent of middle and high schoolers in Pennsylvania reported use of e-cigarettes within the past 30 days.

    • For 10th and 12th graders, 20.4 percent and 27 percent, respectively, reported using a vaping device within a 30-day period prior to the survey.

  • In 2017, PAYS found e-cigarette use had increased; 16.3 percent of middle and high school students said they had used e-cigarettes in the past 30 days.

    • Notably, vaping rates increased to 21.9 percent and 29.3 percent of 10th and 12th graders, respectively.

  • More notably, nicotine consumption increased. In 2015, PAYS found that of “past-year vape users,” 71.4 percent reported using only flavoring and “19.1 percent … [said they] had used nicotine.” However, PAYS noted in 2017, 67.3 percent of e-cigarette users reported vaping using only flavoring, while 29.4 percent reported vaping with nicotine.

  • Minors typically rely on others to obtain tobacco products and e-cigarettes. The U.S. Food and Drug Administration found 86 percent of youths aged 15 to 17 years old obtained [tobacco] cigarettes by asking someone else, and 89 percent said they relied on these sources for their e-cigarettes.

  • Lawmakers should not place excise taxes on products that are significantly less harmful than cigarettes and have helped millions of smokers quit.

Lawmakers in dozens of states are attempting to curb youth e-cigarette use by introducing excise taxes on vaping products. Typically, these include wholesale taxes determined by price and per-milliliter taxes based on product volume. Some of the proposals introduced would tax e-cigarettes that do not contain nicotine.

The use of electronic cigarettes by young people needs to be addressed. However, taxes are an ineffective measure for deterring youth e-cigarette use. Moreover, excise taxes are typically used by lawmakers to discourage the use of dangerous products and should not be applied to tobacco harm reduction products. E-cigarettes have helped millions of U.S. adults quit smoking, so their use should be encouraged and promoted, not taxed.

A recent example of the devastating impact a draconian tax can have on e-cigarettes and vaping occurred in Pennsylvania. In 2016, the General Assembly passed a 40 percent wholesale floor tax on e-cigarettes. Within a year, an estimated 120 vape shops closed in the commonwealth.

Several lawmakers in other states are proposing similar measures under the mistaken belief that increasing the cost of e-cigarettes will deter youth use, despite the fact data from Pennsylvania indicate its e-cigarette tax has not reduced youth use. In fact, vaping among high school students increased after the wholesale tax went into effect.

According to the 2015 Pennsylvania Youth Survey (PAYS), 15.5 percent of middle and high schoolers in Pennsylvania reported use of e-cigarettes within the past 30 days or that they had used an e-cigarette at least once in the 30 days prior to the survey. For 10th and 12th graders, 20.4 percent and 27 percent, respectively, reported using a vaping device within a 30-day period prior to the survey. These numbers are considerably higher than the data provided by the national Monitoring the Future Survey, which shows among 10th and 12th graders, 14.4 percent and 16.2 percent, respectively, reported using e-cigarettes in the past 30 days.

In 2017, PAYS found e-cigarette use had increased; 16.3 percent of middle and high school students said they had used e-cigarettes in the past 30 days. Notably, vaping rates increased to 21.9 percent and 29.3 percent of 10th and 12th graders, respectively. These are significantly higher than the available national figures, which show among 10th and 12th graders, 13.1 percent and 16.6 percent, respectively, reported using e-cigarettes and vaping devices in the past 30 days.

More notably, nicotine consumption increased. In 2015, PAYS found that of “past-year vape users,” 71.4 percent reported using only flavoring and “19.1 percent … [said they] had used nicotine.” However, PAYS noted in 2017, 67.3 percent of e-cigarette users reported vaping using only flavoring, while 29.4 percent reported vaping with nicotine.

More data are necessary, but by all indications, youth are not deterred by e-cigarette taxes. It’s important for lawmakers to note minors typically rely on others to obtain tobacco products and e-cigarettes. The U.S. Food and Drug Administration found 86 percent of youths aged “15 to 17 years old obtained [tobacco] cigarettes by asking someone else,” and 89 percent said they relied on these sources for their e-cigarettes. These so-called “social sources” include siblings, friends, parents, and even strangers.

Lawmakers should avoid taxing tobacco harm reduction products, including e-cigarettes and vaping devices. Current data show these taxes do not reduce youth e-cigarette use. Therefore, lawmakers should not place excise taxes on products that are significantly less harmful than cigarettes and have helped millions of smokers quit.

Nothing in this Research & Commentary is intended to influence the passage of legislation, and it does not necessarily represent the views of The Heartland Institute or Tobacco Harm Reduction 101.

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