On October 1st, Washington D.C. implemented a 67% excise tax on ecig and vaporizer products, including e-liquid. This tax applies to vapor products sold in physical stores, both gas stations and vapor shops, located in the state capitol.
This unfortunate new law is the result of a 2016 budget proposal, which included the Vapor Product Amendment of 2015. This small, yet industry altering amendment effectively stops classifying ecig and vapor products as “other tobacco products,” a classification which required businesses to charge customers a 5.75 percent sales tax on vapor products. Now, vapor products sold in Washington D.C. will be classified under a new vapor category that carries a staggering 67% tax for the retailer. This means that a store owner who sells a $100 vaporizer will owe the city $67 in taxes.
D.C.’s mayor, Muriel Bowser, believes this hefty tax will raise an estimated $400,000 for local programs, ignoring the fact that it will also drive customers away and force people to lose their jobs and businesses. Furthermore, it will reduce convenient access to ecig products for many D.C. residents.
In reality, this excise tax will likely have a negative impact on local economic growth. It will force many ecig shops to lay off employees, close their businesses or transition back to selling smoke products. The consequence of this new ruling is another reminder to vaper advocates across the United States that online access to electronic cigarettes and vapor products is essential to keeping the industry alive. Reasonable taxes and common sense regulation are what the V2 team continues to fight for, but seeing local laws like this one go into effect creates a grim outlook for future federal ecig regulation and taxation.
Although V2 does not operate any independent brick-and-mortar vapor shops in the U.S., our ecig products are sold in thousands of retail locations. This means that the tax could affect V2 vapers living in Washington D.C. who buy their ecig batteries and cartridges locally. With over 8,500 vapor shops in the U.S. and over $2 Billion in global sales in 2014, the numbers prove that these innovative vapor products, sold in both physical stores and online, are helping the U.S. economy grow while delivering a product that is demanded by a growing customer base.
If you are a V2 customer and loyal vapor advocate, we encourage you to find the email address, phone number or even social media profiles of your local elected officials and tell them how ecig and vapor products have positively affected your lifestyle and budget. If we are all proactive in voicing our opinions against outrageous tax levels and illogical regulation, we can all do our part in helping the ecig industry remain alive. Make sure to share this blog post with your friends and family members on Facebook and Twitter in an effort to educate others about the vapor industry.