March 26, 2015
“You can’t find what you’re not looking for.”
In my post yesterday (Part 2) I discussed some of the possible motivating factors behind the highly orchestrated opposition to electronic cigarettes. Now let’s examine the provisions of the two bills introduced in Washington State. Virtually all vaping associations support regulations that are sensible and well-informed. So using that standard, let’s examine what we know about justification for the provisions of this proposed legislation. You be the judge.
The proposed legislation will include a 95% excise tax on the wholesale value of vaping products. The identical sin tax Washington State applies to tobacco cigarettes.
- An article in the Auburn Reporter reports that Gov. Jay Inslee’s proposed budget includes projected revenues from this tax for 2015-2017 to be $18.1 million, growing to $78.4 million for 2018-2019 “to help fill the funding gap for education”.
- The Auburn Reporter article goes on to state that “Money collected from this 95 percent excise tax on vapor products would be split, with 90 percent of the funds going to the state general fund and 10 percent to a new public health services account.”
- According to the CDC’s State of Tobacco website, for 2015 Washington’s State Funding for Tobacco Control: $1,850,000. State Tobacco Related Revenue: $619,900,000.
- According to the Washington State Dept. of Health 7,930 Washington residents died last year “as a result of tobacco use or exposure.” The annual cost for smoking related healthcare: $651,000,000. That’s $658 for every household, even those where no one smokes, per year.
- How many of those lives could be saved by switching to vaping products? How much of those healthcare costs could be redirected “to help fill the funding gap for education”?
- A “sin” tax on e-cigarettes will remove a substantial portion of the cost incentive for smokers to switch to what is regarded by many as a less harmful alternative.
- The tax will do nothing to address cigarette smoking related deaths.
- The estimated $96.5 million dollars of additional tax revenues over a four year period is less than four percent of the $2.4 billion that Washington will spend on smoking related healthcare over the same four year period. And let us not forget; only 10% of that $96.5 million will go to health services.
- Washington has the sixth highest cigarette tax in the U.S. It also has the fourth highest inbound smuggling rate in the nation. 48% of all Washington cigarettes are illegal contraband. Washington’s Department of Revenue estimated the resulting loss of tax revenue in 2012 was $376 million.
- Is this up to our standard of “sensible and well-informed”? You be the judge.
Again referring to the Auburn Reporter article – “The Toxic Trends Report from the Washington Poison and Drug information Center shows a 1,000 percent increase in call volume on e-cigarettes and liquid nicotine from 2012 to 2014”.
- According to the American Association of Poison Control Centers Annual Report 2013 , there were 2.6 million calls to U.S. poison control centers in 2013. Note that this and all call volumes that follow “measure ‘exposures’ – ingested, inhaled, absorbed by the skin or eyes, etc. – not all exposures are poisonings or overdoses.”
- The following are a sampling of the call totals, by substance, taken directly from Table 17a of the AAPCC Annual Report.
- Analgesics – 298,633
- Cosmetics – 199,838
- Cleaning substances – 196,183
- Sedatives – 153,398
- Foreign bodies – 103,737
- Alcohol – 70,258
- Vitamins – 66,206
- Total 2014 e-cigarette and nicotine exposures in the United States according to the AAPPC – 3,957 or 0.06 percent of total Poison Control calls.
- Child-resistant packaging for all vaping products should and almost certainly will be Federal law in the U.S. (see below).
- In a perfect world there would be methods to eliminate all substances that pose a poisoning risk to children. In the real world, no one has figured out a way to do that.
Another vapor-product bill, SB 5477 would require child-resistant packaging for all vapor products sold in the state.
- This is well justified legislation that should have unanimous and unconditional support.
- Responsible retailers have converted to child-resistant packaging.
- A number of states already have child-resistant packaging laws, many more will likely pass similar laws in 2015, and the FDA is expected to include this requirement at the Federal level.
Washington State currently collects almost $620 million in tobacco related revenues – and spends less than $2 million for tobacco control.
Almost 8,000 Washington residents died last year from tobacco related disease. Washington spent more than $650 million for tobacco related healthcare. Estimated revenue from the sin tax on e-cigarettes over four years – $96.5 million. Percentage of that tax revenue that will go to health services – $9.6 million.
E-cigarette exposures or poisonings are everyone’s concern and child-resistant packaging can and will be required on a federal level. If “sin” taxes are an effective strategy in reducing those numbers, the benefits of a 95% tax on cosmetics, cleaning products and vitamins would be exponentially more valuable than any benefit from taxing e-cigarettes could ever be.
Sensible and well-informed? You be the judge.
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Dave Coggin has a Master’s Degree in business and spent 35 years in corporate America. He is a co-founder and partner in DIYELS. He has spent the last five years actively researching and following the evolution of the e-cigarette industry. He is a strong proponent of e-cigarettes as the most promising option currently known for tobacco harm reduction. He may be contacted directly at email@example.com .
The opinions presented here are exclusively those of the author. Vaper’s Vortex is offered as a service to our customers and followers. Anyone considering e-cigarettes as an alternative to tobacco cigarettes should seek qualified advice from a medical professional.