Finance

New Jersey to Institute Huge E-Cigarette Tax

March 11, 2014
 

By Nick Vadala

Way back in 2010, New Jersey became one of the first states to enact a ban on the use of electronic cigarettes in public. Now, Chris Christie plans to continue the state’s history of early e-cigarette legislation adoption with a newly proposed tax on the devices as part of Jersey’s 2015 budget plan.

Christie plans to tax e-cigarettes and e-liquid at the same $2.70 per pack rate that cigarettes have, with legislators apparently worrying that taxing e-cigarettes less than traditional tobacco would be “sending a message out there that they’re somehow safer,” said Assemblyman Dan Benson. By some estimations, the tax could bring an average 30ml bottle of e-liquid to a total of about $100 because it would be taxed the same as a carton of cigarettes—currently, flavored e-liquid costs around $20 to $30 for that same amount.

A hike in price like that likely will all but destroy brick and mortar vape shops, along with inadvertently driving some e-cigarette users back to using traditional cigarettes. Currently, e-cigarettes in New Jersey are taxed at a rate of7 percent under the state’s wholesale tobacco tax, and this new tax stands to generate upwards of $35 million in additional revenue a year.

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