Proposed legislation in New Jersey would raise taxes on e-cigarettes to US$2.70, the same rate as pack of cigarettes

Nevin Barich

NEWARK, New Jersey , March 13, 2014 (Star-Ledger) – A proposed new tax on electronic cigarettes was the burning topic yesterday at the first legislative committee meeting of the state budget season.

Gov. Chris Christie's $34.4 billion budget proposal, delivered last month, suggests raising taxes on the "e-cigarettes" to the regular rate for cigarettes -- which is $2.70 per pack -- saying they're "unregulated and subject to standard state sales taxes only."

But at the Assembly Budget Committee's meeting at Montclair State University, Steven Clark -- a Union City resident who said he quit smoking regular cigarettes a year ago thanks to e-cigarettes that provide nicotine through liquid vapor instead of smoke -- called the idea of raising taxes on them "reckless and harmful."

"Electronic cigarettes have the potential to make smoking obsolete within a generation," Clark said. "With the right combination of tailored regulation and cost-incentives, e-cigs might end smoking as we know it."

Clark said he's a member of Consumer Advocates for Smoke Free Alternatives, an e-cigarette advocacy group, but he was not speaking for it. He said the group is not funded by the e-cigarette industry.

Because the products are so new, there is not much data on their safety. According to a Feb. 28 press release from the Centers for Disease Control and Prevention, e-cigarette vapor has "far fewer of the toxins found in smoke compared to traditional cigarettes," but "the impact of e-cigarettes on long-term health must be studied" and "research is needed to assess how e-cigarette marketing could impact initiation and use of traditional cigarettes, particularly among young people."

CDC Director Thomas Frieden said nobody knows "whether they will decrease or increase use of traditional cigarettes."

Mark Anton, a Flanders resident who owns a company that imports and sells e-cigarettes, said he plans to begin manufacturing the liquid nicotine for the products soon. But if the tax kicks in, he said, he'd open the manufacturing facility in Pennsylvania instead.

The opponents of the tax had a sympathetic ear in the committee's chairman, Assemblyman Gary Schaer, a smoker for more than 40 years.

"You'll forgive me as I hold my own e-cig in my hand," Schaer (D-Passaic) said. "I will admit to you that after having gone through every anti-smoking possibility … it's something which I will agree with you has given me some small modicum of help and, more importantly, it's given my wife and kids some modicum of health."

Assemblyman John Burzichelli (D-Gloucester) said the state treasurer estimates the tax would generate $35 million in revenue annually but that the administration has often been "creative" in its estimates. Other concerns raised at the budget committee touched on funding for higher education, college financial aid, public schools, services for the autistic, Charity Care for hospitals and NJ Transit.

Matt Friedman: (609) 989-0324 or mfriedman@starledger.com

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