US: Reynolds Suggests State Tax Rate for E-cigs

Source from:  Winston-Salem (NC) Journal  05/15/2014

The surging popularity of electronic cigarettes has Reynolds American Inc. opting to be proactive on the inevitability of a state excise tax on the products.

Electronic cigarettes, or e-cigs, are battery-powered devices that heat a liquid nicotine solution in a disposable cartridge and create a vapor that is inhaled.

David Powers, a company vice president, offered Reynolds' tax proposal to the Revenue Laws oversight committee Tuesday. The committee, co-chaired by Rep. Julia Howard, R-Davie, approved passing along the recommendation to the General Assembly for the short session that begins today.

The proposal is a 5 cent-per-milliliter tax to the nicotine mixture used in e-cigarettes. E-cigarette users already pay sales taxes on the device and the nicotine mixture used in it.

By comparison, a pack of combustible cigarettes carries a 45 cent per pack excise tax — one of the lowest in the country.

To put the Reynolds request into context, a typical e-cig cartridge offers about 200 puffs per use, while a typical combustible cigarette offers about 10 puffs per use.

Reynolds spokesman David Howard said the recommendation is aimed at establishing "a fair and reasonable" Enditem