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Should e-cigarettes be taxed? Legislator thinks so

SANTA FE, N.M. — New Mexico bans the sale of e-cigarettes to minors and requires child-resistant packaging, but the more difficult question of how e-cigarettes should be taxed lingers before the Legislature.

Sen. Cisco McSorley, D-Albuquerque, says he’ll make another run at putting an excise tax on e-cigarettes and other so-called vaping products when the Legislature meets in January.

His proposal to do that in the 2015 session never even cleared its first committee. Legislators approved a different bill with a prohibition on sales to those under 18 and other sales restrictions — just like tobacco cigarettes.

But McSorley says that’s not enough; he wants to tax e-cigarettes based on their nicotine content.

“What we need to do is be sure this poisonous, deadly chemical that’s very addictive is not fed to our population without the corresponding ability to continue and enhance research, and try to prevent people from taking up nicotine in the first place,” he told the Journal.

Taxing nicotine could be an incentive to reduce the amount of nicotine in the product, he also said.

McSorley’s proposal for 2016 is likely to be substantially the same as his 2015 bill, which would have imposed a tax of 4 cents per milligram of nicotine contained in the product. Manufacturers also would be required to identify nicotine content, in milligrams, of each unit they sell.

The goal is to make the tax comparable with the current tax on cigarettes, which is $1.66 a pack, McSorley said.

Other tobacco products — cigars and smokeless products such as dip, chew and snuff — are taxed in New Mexico at a lower rate than cigarettes, 25 percent of the product’s value.

Public health advocates say higher prices would be a deterrent to nicotine use, especially among young people, so there is a public health advantage to increasing taxes. The U.S. Food and Drug Administration can’t prohibit the use of tobacco products or tax them, so the focus is at the state level.

As it did last year, the proposal to tax e-cigarettes is getting pushback from the vaping community.

E-cigarette users and business owners told the Legislature’s interim Tobacco Settlement Revenue Oversight Committee this week that e-cigarettes paved the way for them and others to quit smoking tobacco, and an excise tax would harm their small business operations.

“We will lose our local clientele to online businesses out of state,” Mat  Hollingshead, owner of BeeLiquid  Vapers’ Lounge in Taos told the Journal. He and his wife are currently the business’s only employees, he said.

“One of the attractive features of vaping is that it is less expensive than smoking. … We want to give people incentive to move away from cigarettes, and price is just one of those,” Hollingshead said.

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