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Wednesday, February 8, 2012
Legislature to Impose 70% Tax on Tobacco Substitute?
By News Release @ 8:30 PM :: 5088 Views :: Energy, Environment

Nicolites Expresses Concern Over Hawaii E Cigarette Legislature

Leading UK electric cigarette retailer Nicolites reviews news of Hawaii tax bill on tobacco-free products.

News Release from Nicolites February 8, 2012

Nicolites, a prominent online electronic cigarette retailer situated in the heart of England, has expressed concern over the decision of the Hawaii state Legislature to classify all e cigarettes and related accessories as tobacco products, therefore applying a tax levy of 70% to these goods. (Bill # HB2557 / SB2819 )The web-based company is aware that the move will prohibit the sale of electronic cigarettes to minors in the state, which Managing Director Nikhil Nathwani believes is a responsible decision. But as he explains, passing such a bill could and will have a hugely negative impact on US smokers determined to substitute real cigarettes for the tobacco-free alternatives. 

“Charging ex-smokers more to use a product that is taking off phenomenally around the world is a step backwards in our eyes,” explains Nikhil. “Electronic cigarettes and e cigarette accessories don’t contain any tobacco whatsoever and simply produce a warm vapour that mimics the sensation of smoking, so in our view these products cannot be classified as the same as real cigarettes.”

As Sales Director at Nicolites, Birju Pujara is a fierce advocate of the benefits of e cigarettes and also struggles to support the legislation.

“We need to reach a stage whereby consumers have a positive view of electric cigarettes, yet bills such as this portray them as no different to tobacco products,” he states. “People should be encouraged to use e cigarettes and not subjected to the same high levels of tax.”

Nicolites is now the leading and most widely available brand of electric cigarette in the UK; they have formed business partnerships with many of the largest retailers to bring these wonderful innovations right on to the doorstep of every person in the country. Established in late 2007, Nicolites has grown into a multi-million pound company with international distribution networks and continues to grow at a phenomenal rate.


Honolulu Magazine, February 7, 2012: “State Proposes Absurd Tax on Electronic Cigarettes

One small problem with the bills: electronic cigarettes do not contain tobacco. At all. Dismantle one and all you’ll find is a battery, a heater and solution of water, glycerin and nicotine. The fluid, when heated, creates a smoke-like vapor that is odorless and non-toxic and decidedly not smoke. Nicotine comes from tobacco, but is not itself tobacco—otherwise, why else are nicotine gum, lozenges and patches routinely sold as safe alternatives to smoking and as stop-smoking aids? (Of course, none of these nicotine-laced products are included in this anti-e-cig bill, a telling detail).

What the state really seems to want is the tax revenue. I’ve written about this before: governments have perversely immoral incentives to make sure as many smokers keep smoking as possible, because governments are hooked on cigarette tax revenue. For example, see my September 2006 column, “Double Bind,” about Hawaii’s dependence on cigarette taxes to fund trauma services.

If these bills pass and electronic cigarettes and all their accessories (batteries, chargers, etc.) are subject to the same taxes as actual cigarettes, then a certain number of smokers will choose to stay with tobacco cigarettes. A certain number of those people will, with statistical certainty, die needlessly of heart disease or cancer. If the state actually cared about our health, it would offer tax incentives to smokers who switch to electronic cigarettes (or, to be fair, nicotine gum, patches, lozenges, etc.) Instead, I think some legislators have panicked over the prospect that people are successfully replacing taxed cigarettes with a un-taxed non-tobacco substitute and are in a hurry to redefine that alternative as tobacco for the sole purpose of grabbing the cash.


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