Key Findings
- New alternative nicotine products offer less harmful methods of consuming nicotine. Switching consumption from combustible cigarettes to the products saves lives.
- To incentivize switching, safer nicotine products should receive a preferential tax rate compared to combustible cigarettes.
- Despite conclusive scientific evidence, many Americans believe nicotine is a carcinogen when it is not. Tax rates based on nicotine content should be avoided.
- An appropriate tax structure for alternative nicotine products is a specific tax per milliliter for vaping products and by weight for heated tobacco and modern oral products.
- Reduced rates should be given to products that are less harmful, substitutes for combustible cigarettes, more difficult to mass consume, and not addictive.
- Using evidence available at the time of this publication, four categories of tax rate reductions for less harmful alternative tobacco products are:
- 50 percent reduction: very low nicotine cigarettes, loose tobacco
- 75 percent reduction: heated tobacco products, moist oral tobacco
- 90 percent reduction: vapor and modern oral (snuff, snus, and pouches)
- 100 percent reduction: nicotine replacement therapies (gums, lozenges, and patches)
Source Tax Foundation
