OPINIONTobacco

Colorado, Oregon Voters Approve Cigarette, Tobacco Tax Increases

Measures affect cigarette, vaping, other nicotine products
voting
Photograph: Shutterstock

LAKEVILLE, Minn. — Colorado and Oregon voters approved measures in the Nov. 3 general election that increase the taxation of cigarettes, tobacco products and nicotine products (including vaping products). Here’s a breakdown of those measures:  

Colorado Proposition EE: Proposition EE passed by a margin of 1,938,525 to 908,805, or 68% to 32%, according to unofficial vote totals. Proposition EE contains the following provisions:

  • Increases the cigarette tax to $1.94/pack on Jan. 1, 2021, $2.24/pack on July 1, 2024, and $2.64/pack on July 1, 2027.
  • Increases the tax on cigars, pipe tobacco and smokeless tobacco to 50% on Jan. 1, 2021, 56% on July 1, 2024, and 62% on July 1, 2027. 
  • Establishes a minimum tax for moist snuff products at $1.48 per 1.2-ounce container as of Jan. 1, 2021, $1.84 per 1.2-ounce container as of July 1, 2024, and $2.26 per 1.2-ounce container as of July 1, 2027.
  • Establishes a new tax on nicotine vapor products of 30% on the manufacturer’s list price as of Jan. 1, 2021, 35% as of Jan. 1, 2022, 50% as of Jan. 1, 2023, 56% as of July 1, 2024, and 62% as of July 1, 2027.
  • Sets new tax rates for modified-risk tobacco products which are designated by the U.S. Food and Drug Administration (FDA) as having lower health risks compared to existing products. The new tax rates are 30% of the manufacturer’s list price as of Jan. 1, 2021, 35% as of Jan. 1, 2022, 50% as of Jan. 1, 2023, 56% as of July 1, 2024, and 62% as of July 1, 2027.
  • Sets a minimum price of cigarettes, including all applicable taxes, at $7 per pack as of Jan. 1, 2021, and then $7.50 per pack as of July 1, 2024.
  • Assesses on-line sales of cigarettes, tobacco products and nicotine products from out-of-state sellers to Colorado consumers at the new tax rates listed above.

Oregon Measure 108: According to unofficial vote totals, Measure 108 passed by a margin of 1,379,372 to 702,439, or 66% to 34%. Measure 108 contains the following provisions:

  • Increases the cigarette tax to $3.33 per pack (a $2-per-pack increase).
  • Establishes a new tax on nicotine vapor products at 65% of the wholesale sales price.
  • Impose a tax cap of 65% of the wholesale sales price on cigars, not to exceed $1 per cigar (a 50-cent increase in the tax cap).
  • The new taxes apply to tobacco tax reporting periods beginning Jan. 1, 2021.

Thomas Briant is the executive director of NATO, a tobacco retailing association based in Lakeville, Minn. Reach him at info@natocentral.org.

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