Several State Legislatures Considering Tobacco Tax Increases

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State legislatures are in full swing with many states holding hearings to consider legislation that would impact the tobacco and nicotine industry.

Tax Increases

In 2025, tobacco tax increase legislation is being considered in over half of the states. This uptick is a change from the last few years where only a handful of states have considered increased tobacco taxes.

Governors in Ohio, Michigan, New Jersey, Rhode Island, Massachusetts and Maine have included these tax hikes in their state budget programs. Additionally, the North Dakota Senate has passed legislation that boosts taxes on cigarettes and cigars and implements a new tax on vapor products and nicotine pouches. The bill now heads to the North Dakota House for further consideration. Other serious threats of tax increases are pending in New Mexico, Indiana, Hawaii and Washington.

Banning tobacco and nicotine flavors continues to be considered by state legislatures. States surrounding the two states that have enacted flavor bans on all tobacco products, California and Massachusetts, have introduced similar legislation. On the West Coast, flavor ban bills are pending in Oregon, Washington and Hawaii. In the Northeast, Connecticut has introduced flavor ban legislation and New York is looking to add to its existing law that bans flavored vapor products by including a ban on all other flavored tobacco products such as menthol cigarettes and flavored nicotine pouches.

Vapor Registries 

A continuing emerging issue in the states is the creation of state vapor product registries. After last year’s state sessions, 10 states are in the process of creating state vapor registries and currently 14 additional states are considering this legislation.

The introduction of these bills is in response to the uncertainty around the FDA premarket tobacco product application (PMTA) process and the proliferation of flavored disposable e-cigarettes on the market. The FDA has not completed processing applications for thousands of e-cigarettes and other nicotine products. The FDA has only approved the marketing of a few dozen products, making it unclear to retailers and the public of the regulatory status of a large number of products, such as those for which a PMTA was never filed, those for which a PMTA was timely filed and the application is awaiting an order and those for which a PMTA was denied but the application remains pending for legal reasons. These bills create a state-based directory that requires e-cigarette manufacturers to submit information to state tobacco regulators demonstrating that any e cigarette being sold in the state is in compliance with FDA regulations and guidance. 

Nicotine-Free Generation 

Massachusetts and Nevada have state bills pending that would create a “nicotine-free generation.” This issue first appeared in several towns in Massachusetts that ban the sale of tobacco and products to anyone born after a certain date. NATO has been leading engagement efforts to inform stakeholders that these misinformed policies are not about youth—they instead target adults 21 and older who should have the right to choose which legal products they purchase and use.

The “rubber will meet the road” over the next three months as most states will wrap their legislative session by the end of June. NATO works with its retail members and other stakeholders in all 50 states to protect the business interests of the tobacco industry.

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