State senator tries third time for tax on e-cigarettes, vape sticks

For the third time in as many legislative sessions, Kodiak Sen. Gary Stevens is leading the push to get a tax on e-cigarettes and vaping products into state law.

“Taxes have been proven to reduce youth tobacco use, resulting in fewer kids becoming life-long smokers,” Stevens said in offering his legislation, which would add a 25% state tax to the sales price to dissuade youth from vaping.

Senate Bill 89 also would raise the legal age to buy vape sticks, electronic smoking devices and other similar nicotine products in Alaska to 21, matching the federal rule.

Stevens’ first effort died when the Legislature adjourned early in the pandemic-shortened 2020 session. Then, in 2022, although lawmakers overwhelmingly approved his second attempt, Gov. Mike Dunleavy vetoed the measure. “A tax increase on the people of Alaska is not something I can support,” the governor said in his veto message.

Though the tax could raise a few million dollars a year, Stevens promotes the legislation as an attempt to stem the increase in teen use of vape products, not as a money-maker for the state.

The Alaska Department of Health’s Tobacco Facts 2022 Update “shows an increasing trend among young Alaskans in high school, indicating 26% of the statewide population as active users of electronic smoking products (ESPs) in 2019 … and 46% of students having ‘tried’ ESPs,” Stevens reported in his sponsor statement for the bill.

“These products are cheap. If you measure it by the puff, it (the tax) is pennies,” Stevens’ aide Tim Lamkin testified at the Senate Labor and Commerce Committee on April 3.

The measure is a priority for Stevens, who serves as Senate president. It is one of only two bills this session where he is the prime sponsor.

Tabitha Blades, a high school assistant principal in Soldotna on the Kenai Peninsula, testified in support of the bill at the Labor and Commerce Committee meeting. She told senators underage vaping is a growing problem, requiring that she spend more than an hour every school day dealing with vaping incidents. In addition, the school district has spent thousands of dollars installing vape detectors in restrooms and locker rooms.

The Senate committee held the bill for amendments and could bring it up again as soon as this week, though it has a lot of ground to travel to win approval before the Legislature’s mid-May adjournment deadline. In addition to the Senate Finance Committee and full Senate, the measure would need to win approval in the generally anti-tax House.

Bills that fail to advance this year — the first half of the Alaska Legislature’s two-year session — remain on the table for action next year.

More than 30 states tax e-cigs, vape sticks and such. There is no federal tax.

Alaska taxes regular tobacco cigarettes ($2 a pack) and cigars and loose tobacco (75% of the wholesale price). Several Alaska municipalities have their own cigarette tax, and a few impose a tax on electronic smoking products. Anchorage has collected a 55% tax on the wholesale price of e-cigs and vape sticks since 2011; Juneau and Petersburg add a 45% tax on the wholesale price.

 

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