The vast majority of state legislatures have adjourned for their 2016 legislative sessions; however, below are highlights of interesting tobacco-related legislative news from the National Association of Tobacco Outlets, Inc. (NATO)* that pertain to the brothers & sisters of the leaf.
Tobacco Tax Increases
During 2016:
23 states considered bills to increase cigarette and/or tobacco product tax rates
3 states passed and enacted tax increases including-
Louisiana ($.22 per pack cigarette tax increase);
Pennsylvania ($1.00 per pack cigarette tax increase and a new other tobacco products [OTP] tax rate of $.55 per ounce, which excludes cigars); and
West Virginia ($.65 per pack cigarette tax increase plus another 5% tax rate hike on OTP)
20 other states also considered bills to raise cigarette and tobacco taxes, but legislation did not pass in Alaska, California, Florida, Georgia, Hawaii, Indiana, Kentucky, Maryland, Massachusetts, Mississippi, Nebraska, New Jersey, New Mexico, New York, Oklahoma, Rhode Island, Vermont, Virginia, Washington, and Wyoming
November Ballot Questions
California: Legislature did not pass a bill to raise the state cigarette and OTP tax rates; however, a petition to place a question on the November ballot was certified. Therefore, California voters will vote on whether to raise the cigarette tax rates by $2.00 per pack and increase the OTP tax rate proportionately in line with the higher cigarette tax.
Missouri: There is a pending ballot question which includes increasing the state’s current OTP tax rate by another 5%.
Colorado: A ballot question has been approved that would raise the OTP excise tax by another 22% of the manufacturer’s list price.
North Dakota: The general election ballot will have a question whether to increase the state cigarette tax by $1.76 per pack from the current $.44 per pack to $2.20 per pack and raise the OTP tax from 28% to 56% of the wholesale price.
State Minimum Age Bills
During 2016:
17 state legislatures had bills introduced to raise the legal age to purchase tobacco products to either age 19 or age 21
Only California enacted a statewide law to increase the legal minimum age to 21, joining Hawaii as the only two states with an age 21 law.
Bills introduced to raise the legal age to 21 in Connecticut, Illinois, Kentucky, Maryland, Massachusetts, Mississippi, New Jersey, New York, Oklahoma, Rhode Island, Tennessee, Utah, Vermont, Washington and West Virginia did not pass
Bill introduced to raise the legal age to 19 years old in Iowa did not pass
*NATO is a national trade association organized to enhance the common business interests of all tobacco retailers and to monitor and assist members in responding to tobacco-related legislation on the local, state and federal levels.