Indiana Reduces E-Cigarette Tax Despite Protests

According to foreign media reports on March 17, 2022, Indiana's new tax on electronic cigarettes was reduced even before it went into effect, despite protests from anti-smoking advocates.

Indiana Governor Eric Holcomb signed a bill this week that includes a reduction of the tax on closed system e-cigarette pods, including those made by Juul, from 25% to 15% for wholesalers. Last year, Indiana lawmakers approved the state's first e-cigarette tax at a higher rate, which will go into effect in July 2022.

The Republican-led legislative body has approved lower tax rates, which are included in a 118-page bill that features seven lines primarily focused on technical changes to tax laws.

Travis Holdman, the Republican senator and chairman of the Senate Tax Committee, has stated that the changes in the taxation of electronic cigarette devices are aimed at aligning them with the 15% tax rate set for refillable electronic cigarette products last year. Holdman explained that the goal is to apply the same tax to all electronic cigarette devices and products.

The health organization and Indiana State Chamber of Commerce have urged lawmakers to maintain a 25% tax rate and believe that electronic cigarette devices should face similar taxes as tobacco products to prevent young people from starting to use them.

Brian Hannon of the American Cancer Society has stated that an excise tax of at least 20% should be imposed on electronic cigarette devices to match the 99.5 cents per pack cigarette tax in the state of Indiana.

According to data from the Centers for Disease Control and Prevention, these organizations have been pushing to raise the unchanged cigarette tax since 1997 in recent years, in hopes of reducing the smoking rate among adults in the state, which currently stands at 19.2%, making it the 10th highest in the country in 2019.

(Source: Associated Press)