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  • FDA to Allocate $200M Toward Combating Illicit Vapes

    FDA to Allocate $200M Toward Combating Illicit Vapes

    As part of the continuing resolution passed by Congress and signed yesterday (November 12) by US President Donald Trump to reopen the government, the Food and Drug Administration (FDA) will be required to allocate at least $200 million of its $712 million in user fees toward enforcing regulations on electronic nicotine delivery systems (ENDS). Of this amount, $2 million will support a multi-agency task force, including the Justice Department and Homeland Security, aimed at cracking down on illegal ENDS products imported from China and other countries.

    The FDA is also required to update its 2020 ENDS enforcement guidance within one year to include flavored disposable vapes and clarify the definition of disposable ENDS products. In addition, the law updates the Imports and Exports section of the Food, Drug, and Cosmetic Act to include tobacco products, strengthening the FDA’s authority to regulate their import alongside food, drugs, devices, and cosmetics.

    The agency must provide semi-annual reports to Congress on efforts to remove illegal ENDS products from the market, with the first report due within 180 days of enactment (November 12). The FDA is also expected to submit a report detailing its work to educate retailers on which products are legally allowed for sale.

  • Legislation Introduced to Close Tobacco “Loopholes”

    Legislation Introduced to Close Tobacco “Loopholes”

    U.S. Senate Democratic Whip Dick Durbin, U.S. Senator Ron Wyden, U.S. Representative Raja Krishnamoothi, and several others today (March 4) introduced the End Tobacco Loopholes Act, legislation that would “lower tobacco use and reduce healthcare spending” by increasing the taxes on tobacco products. The legislation would establish a federal tax on e-cigarettes, update the federal cigarette tax rate, and harmonize the tax rate across tobacco products.

    “Big Tobacco’s deadly profit scheme relies on addicting children,” Durbin said. “Our most effective strategy to reduce smoking and prevent a new generation from becoming addicted is to price these dangerous tobacco products out of the reach of children. But federal law has not been updated in 16 years, creating loopholes that Big Tobacco has used to hook kids. The End Tobacco Loopholes Act would help reduce tobacco and e-cigarette use, save billions in healthcare costs, and improve the health of children for generations to come.”

    According to Durbin’s website, the legislation would “close tax code loopholes for tobacco products by increasing the federal tax rate on cigarettes, pegging it to inflation to ensure it remains an effective public health tool, and setting the federal tax rate for all other tobacco products at this same level.” It would also “follow the lead of 30 states and Washington, D.C., that have set their own state taxes, by setting a federal tax on these vaping products. The legislation also closes numerous tax and regulatory loopholes that the tobacco industry has exploited for large cigars, smokeless tobacco, and pipe tobacco by shifting production and sale schemes to avoid taxes and oversight, resulting in nearly $4 billion in lost federal revenue between 2009 and 2018.”

    Durbin added that “large cigars, smokeless tobacco, and pipe tobacco remain dramatically undertaxed compared to cigarettes, at a time when their use—especially among youth—is trending at a comparable rate to cigarettes.”

  • Congress to Close E-Cigarette Ad Loophole

    Congress to Close E-Cigarette Ad Loophole

    Image: higyou | Adobe Stock

    The U.S. Congress wants to end a legislative provision that allows manufacturers to claim federal tax deductions for the cost of advertising for e-cigarettes and tobacco products. That includes the ads they buy on the radio.

    Senators Jeanne Shaheen and Richard Blumenthal have reintroduced the No Tax Subsidies for E-Cigarette and Tobacco Ads Act (S. 464), which if passed would not make the direct-to-consumer ads illegal but would end the ability for companies to take tax deductions for advertising expenses related to vaping and other tobacco products, according to Insider Radio.

    “Tax breaks for tobacco and e-cigarette giants allow the industry to profit from its manipulative marketing,” Blumenthal said. “Our legislation ends these write-offs to protect kids and other consumers from being lured into lifetimes of addiction.”

    Radio and television advertising for traditional tobacco products has been banned under federal law since January 1971, and certain other forms of tobacco advertising are restricted under the 1998 Tobacco Master Settlement Agreement. However, none of these restrictions apply to e-cigarettes.