Ohio to ban sale of e-cigarettes to minors, but what about the money?

By Maggie Thurber | for Ohio Watchdog

The Ohio Legislature has voted to ban the sale of e-cigarettes to minors, but how the products are classified is still a concern — and money is the issue.

House Bill 144 makes it a fourth-degree misdemeanor to sell e-cigarettes to children younger than 18, an action that legislators, supporters and opponents of the bill agreed on.

But it creates a new designation of “alternative tobacco product,” which affects how the products are taxed, and that’s where views diverged.

The bill defines an “alternative tobacco product” as an electronic cigarette or any other product or device that “consists of or contains nicotine that can be ingested into the body by any means, including, but not limited to, chewing, smoking, absorbing, dissolving, or inhaling.”

The House, which passed the measure by a vote of 67-25 in November, was split primarily along party lines with Democrats wanting increased taxes on the products and a ban on their usage indoors. They are not now included in Ohio’s smoking ban.

During committee hearings, Rep. John Carney, D-Columbus, called the bill a “smokescreen” for appearing to protect children when it was really just to “create a safe harbor for the e-cigarette industry.” He said the tax on the products is the real issue.

As an alternative tobacco product, e-cigarettes would not be taxed the same way as combustible tobacco products. The Ohio tax on a pack of cigarettes is $1.25, with Cuyahoga County adding an extra 34 cents.

The American Cancer Society Cancer Action Network pushed for the products to be classified, labeled and taxed the same as cigarettes.

“E-cigarettes are new products that are largely untested. They contain nicotine which is highly addictive and derived from tobacco. There is no reason to give these products special treatment in the Ohio Revised Code,” Jeff Stephens, the group’s Ohio government relations director, said in a release after bill passed the House.

Many e-cigarettes contain nicotine derived from tobacco, but some manufacturers get that nicotine from vegetable sources.

Carney said taxing one product but not another could create an incentive for individuals to use the less expensive one.

The Senate unanimously approved the bill Feb. 12.

Jacob McConnico, a spokesman for Reynolds American, said his company, and the industry in general, believes minors should not use or have access to tobacco or tobacco-derived nicotine products.

“We applaud the Legislature for taking this action, and a unanimous decision shows legislators are doing the right thing to pass common sense regulations on vapor products,” he said. “But as far as taxation and public use, they should be treated differently.”

“If a tax is going to be applied to these products,” McConnico said, “we believe it should be a de minimis tax or a tax reflective of the fact that these are not like traditional combustible products. We believe the best direction for legislators and for public health to go with vapor products is to not dis-incentivize current adult cigarette smokers from trying these smoke-free alternative products.”

While a separate designation for e-cigarettes might result in fewer tax collections, could it be a good thing for people trying to quit smoking?

Jeff Stier, a senior fellow at the National Center for Public Policy Research, thinks so.

“Nicotine,” he told a New York City Council Health Committee in December, “is addictive, but not particularly harmful, especially at the levels consumed by smokers or users of e-cigarettes.”

Stier said nicotine “is about as dangerous as the caffeine in soda” and that “e-cigarettes provide the nicotine and the habitual activity of smoking, without the danger of burning tobacco.”

“Here is a product created by private-sector innovation that is doing what many hundreds of millions of dollars of government spending, costly litigation, addictive excise taxes, warning labels and punitive regulation have been unable to do: help cigarette smokers quit happily,” he said.

Rep. Stephanie Kunze, R-Hilliard, mentioned the debate over taxation in her sponsor testimony to the Senate, but no senators raised the issue. “This legislation does not prohibit e-cigarettes from being taxed in the future,” she said.

Wednesday, the House concurred, 68-28 ,with minor changes made by the Senate. The bill was sent to the governor for signature.

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