A bill imposing a 56% tax on electronic cigarettes, and creating new restrictions on vape sales, earned preliminary approval from the Utah Senate on Friday.
The tax would be applied to the wholesale price of e-cigarrettes before retailers mark the items up for sales to customers, and is estimated to generate roughly $18 million in its first year and more than $20 million in subsequent years.
“I rise in support of this bill and thank the sponsor for working really hard to get to this point,” said Sen. Luz Escamilla, D-Salt Lake City.
Sen. Lincoln Fillmore, R-South Jordan, said he was concerned that the tax would generate twice as much revenue as needed to fund a series of enforcement and tobacco cessation programs created under the bill, particularly since some argue that vaping is safer for adults than traditional smoking.
Fillmore also said he was uncomfortable with the state using so-called “sin taxes” to fund its operations.
“If the government becomes reliant on people continuing to purchase nicotine vapor,” he said, “we are creating the perverse incentive to increase the number of people vaping.”
State leaders have indicated that targeting vaping is a priority following last year’s outbreak of vaping-related lung injuries and deaths — including one in Utah — and a spike in teen use of electronic cigarettes.
The Senate voted 21-5 in favor of the legislation. An additional vote of the Senate is required before the bill can move to the House for consideration.