Texas taxes cigarettes, but not vaping products. Here’s why

Like most products, cigarettes are taxed in Texas, but it’s a different story for vaping products .

Over 30 states have some form of tax rate on vaping and electronic nicotine delivery systems, according to Tax Foundation. Tax rates vary by each state, with most focusing on wholesale and retail sales.

While Texas has a tax on cigarettes, it does not have one specifically for vaping products. Here’s what we know:

How does Texas define vaping products?

Vaping products come in all shapes and sizes. Some resemble USB drives while others are as bulky as cell phones.

The Texas Comptroller, which serves as the state’s chief financial officer, defines e-cigarettes as “battery-powered vaporizers that simulate tobacco smoking by producing an aerosol that resembles smoke.”

Further description states that these devices use a heating element or atomizer that vaporizes an e-liquid made up of nicotine, vegetable glycerin, propylene glycol and flavorings, according to the state. There are also some e-liquids used in vapes that do not contain nicotine.

While most vapes contain nicotine, they do not contain tobacco. However, since nicotine comes from tobacco, vapes are classified as tobacco products by the state.

As for cigarettes, the Texas Administrative Code defines them as “a roll for smoking, made of tobacco or tobacco mixed with another ingredient and wrapped or covered with a material other than tobacco and that is not a cigar.”

Why doesn’t Texas apply the cigarette tax to vaping products?

Texas’ cigarette tax is used for distributors, wholesalers, retailers and manufacturers with state representation.

A conventional 20-cigarette package is taxed at $1.41 per pack, while a 25-cigarette package is taxed at $1.7625 per pack. The tax rate increases from there at $70.50 per 1,000 cigarettes weighing three pounds or less, per 1,000, according to the state.

As for why vaping products aren’t subject to the cigarette tax, the Texas Comptroller’s website sums up this inquiry in a sentence:

“E-cigarettes and e-liquids do not meet the statutory definition of a cigarette, so they are not subject to the cigarette tax,” the website reads.

Thus, since the state’s definition of the two smoking products doesn’t match, vaping products are not subject to Texas’ cigarette tax. However, vaping products are still subject to state and local sales tax.

Texas lawmakers attempted to pass legislation in 2019 that would have put a 10% state retail excise tax on vaping products, but the bill died in the House.

What regulations are in place for vaping products in Texas?

Even though vaping products are not subjected to cigarette tax, both items are lumped together as far as state regulation goes.

In 2019, federal and state law raised the age requirement to purchase tobacco products, such as cigarettes and vaping products, from 18 years old to 21 years old.

Although vaping products do not contain tobacco, they do utilize nicotine, which comes from tobacco. Thus, vapes are categorized as “tobacco products” by the state of Texas.

What are the health risks associated with vaping?

The common theme surrounding vaping is that its safer for people than smoking, but that doesn’t mean its a scot-free experience.

Texas Health and Human Services department outlined a few health risks associated from vaping, particularly how inhaling chemicals and compounds affects the body:

• Brain- The brain is still developing until age 25 and using nicotine in adolescence can harm parts of it that control mood, attention, impulse control and learning.

• Lungs- Breathing in ultra-fine vapor particles can cause asthma attacks, wheezing, coughing and shortness of breath. Also, flavor chemicals such as diacetyl can permanently injure lungs.

• Organs- Heavy metals inhaled through vapor can build up in organs and blood, causing damage.

• Head- Formaldehyde and chemicals known as volatile organic compounds can cause eye, nose and throat irritation, along with possible lung and throat cancers.

• Skin and face- Vapes need batteries to run and in some cases, exploding units have caused serious burns and at least one fatality.