Hawaii Introduces New E-cig Taxation Legislation

On April 8th, according to The Honolulu Star-Advertiser, Hawaii's new tax bill (S.B 975) has been passed by the House Committee on Finance (FIN). However, the bill aimed at addressing the rising rates of youth e-cigarette use (S.B 1447) has died as it did not appear on the agenda of the state hearing on April 6th.

The new bill will include e-cigarette products in tobacco taxation and regulation

Senate Bill 975 proposes to amend the definition of "tobacco product" in the current Cigarette and Tobacco Tax Law to include e-cigarettes and e-liquids. This means that e-cigarette products will be subject to the same taxation standards as other tobacco products, such as cigarettes.

The current tax rate on these products is much lower than that imposed on combustible cigarettes, the bill noted.

The bill has been recommended for passage by the committee as it has been proposed for a third reading by FIN, indicating that it has met the standards for passage.

According to The Honolulu Star-Advertiser, legislators and candidates in Hawaii were asked to sign a pledge this year to refuse any campaign donations from tobacco companies. Currently, 30 lawmakers have signed the pledge.

Research has shown that nearly one-third of Hawaii's public high school students and nearly one-fifth of middle-school students frequently use e-cigarettes.

Supporters of the bill believe that increasing taxes will be an effective measure to reduce the use of e-cigarettes among young people who are sensitive to prices.

The bill was not scheduled for a hearing in the FIN

According to a recent report from 2FIRSTS, Senator Brandon Elefante has proposed a new bill (S.B 1447) that contemplates allowing each county to re-enact their own tobacco laws in order to supersede the Hawaiian legislation from 2018. This will allow county governments to enact more stringent regulations than state laws.

Members of health organizations such as the American Cancer Society Cancer Action Network, the American Heart Association, the American Lung Association, the Campaign for Tobacco-Free Kids, and the Hawaii Public Health Institute had hoped for this bill and supported giving enforcement power over tobacco products to local counties since the legislature failed to stop the sale of flavored tobacco across the state.

However, the bill was not scheduled for a hearing by the  FIN before April 6th, and therefore, it can no longer move forward.

In March 2023, a bill (HB 511) proposing to ban the sale of flavored tobacco products in Hawaii also failed due to the failure to schedule a hearing on time.

Also read:

【1】Exclusive Summary of US E-cigarette Excise Tax in Each State

Reference：

【1】Bill giving Hawaii counties power to regulate vapes dies in committee

【2】SB 975

【3】Campaign for tobacco-free kids

【4】SB 1447