Smoke Free Alternatives Trade Association

Response from Smoke Free Alternatives Trade Association (SFATA) Regarding Passage North Carolina House Bill 1050


New York, NY -- (ReleaseWire) -- 05/28/2014 --The Smoke-Free Alternatives Trade Association (SFATA) and our North Carolina members are disappointed that House Bill 1050 was passed through committee last night. Because the bill was pushed through, no time was permitted for public comment on a bill that adversely affects small and mid-sized businesses in the vapor industry. The bill adds a five-cent tax on each milliliter of e-liquid, the solution used in personal electronic vaporizers and e-cigarette cartridges. The bill’s accelerated timetable for discussion and vote, coming on the heels of a holiday weekend, caught the industry by surprise.

The vapor industry has never supported this bill. This “sin tax” will result in a very negative impact on small businesses throughout the state. North Carolina is only the second state to have a “sin tax” on people simply trying not to smoke. Massachusetts, Vermont, Washington, Oregon, Indiana and other states have all rejected such efforts to create new taxes on products that people use to move away from combustible tobacco (and it’s related health risks).

Despite Governor McCrory signing a landmark tax reform package into law, North Carolina has, according to the John Locke Foundation, moved toward a “bad tax policy which runs counter to basic principles of economic efficiency, individual liberty, and social equity. Furthermore, the legislative process by which it is being considered lacks all transparency.”

Businesses throughout North Carolina will lose sales as out-of-state online sellers may possibly be able to sell without tax to North Carolinians and in-state online transactions will be taxed. Vapor products and e-cigarettes are already taxed at a sales rate of between 4.75 and 8.25 percent. The result of a tax hike on the products would lead businesses to suffer, leaving large tobacco companies to benefit. Business growth in the industry will be stymied, limiting options for smokers who are looking for an alternative to deadly combustible cigarettes.

Taking aim at vapor products also works at cross-purposes with efforts to cut down on the harm associated with smoking according to Americans for Tax Reform, citing a recent study by Cancer Research UK which found that smokers attempting to quit were 60 percent more likely to report success with e-cigarettes than with any other method.

Vapor products provide the nicotine long-term smokers desire without tobacco or dangerous combustion, and many recent studies indicate that the products are considerably less harmful than tobacco cigarettes, as well as being a strong alternative to combustibles.

The Smoke Free Alternatives Trade Association is dedicated to the advocacy, education, and reputation of the vapor products industry. As the largest trade association of its kind, with more than 140 members, SFATA builds the networks necessary to support campaigning and research endeavors paramount to the future of the industry. For more information, visit, email or call 202-251-1661.