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Oregon store owners prepare for new e-cigarette tax

Starting Jan. 1, e-cigarette and vaping products will also be taxed for the first time.

Posted: Dec 28, 2020 4:49 PM
Updated: Dec 28, 2020 5:54 PM

SPRINGFIELD, Ore. – Oregon will soon have the sixth-highest cigarette tax in the nation when increased tobacco taxes take effect in the new year.

Voters passed Measure 108 by an overwhelming margin in November with 66% of Oregonians voting yes.

Starting Jan. 1, cigarette taxes will go up $2 per pack, and for the first time, there will be a tax on e-cigarettes and vaping products. Merchants will see a 65% increase on their wholesale price.

RELATED: OREGON'S FIRST VAPING TAX WILL HELP THOUSANDS, MEASURE SUPPORTERS SAY

Oregon Vape Society owner Eric Pinnell said customers won’t see that high of a mark-up on his store shelves when all is said and done.

“When you pass it as a retail item, it doesn’t quite equate to 65% to the customer. It’s a little bit less because our cost is less than what we retail for,” Pinnell said.

Pinnell said customers will only see an increase of about 35% and he’s been working to make sure they know it’s coming.

“We’ve warned all of our customers with kind of a high number, knowing there’s always a chance we may be able to work it out to be a better price in the long run for them,” Pinnell said.

Despite an impending tax, he said there has not been a big rush of customers looking to stock up before the prices rise.

Pinnell said vaping is what helped him finally ditch cigarettes. When he opened Oregon Vape Society in Springfield three years ago, he wanted to help other people quit.

“Taxes weren’t even a thing on my radar. I was more concerned about the number of people who consume combustible cigarettes and had tried other means to quit,” Pinnell said.

The American Cancer Society had the same concern, but a very different way to fix it. The society's Cancer Action Network was a major player in the campaign to approve Measure 108.

Jamie Dunphy with the American Cancer Society Cancer Action Network said the tax will help save lives.

“Increasing the price on tobacco and tobacco-related products is the most effective tool we have on encouraging people to quit,” Dunphy said. “Our early estimates said we think around 19,000 people will either stop smoking or never begin smoking in Oregon alone just by raising the taxes on cigarettes and creating the tax on e-cigarettes.”

But Pinnell worries about the possibility of future taxes levied against his products.

“This opens Pandora’s box for Department of Revenue to tax every other piece of paraphernalia out there. So it’s only a matter of time before the people interested in taking taxes start collecting on bongs, pipes, shot glasses,” Pinnell said.

Dunphy said there will not be a push for additional taxes in the near future. He expects the tax to generate $135 million in revenue, which will fund health programs and tabacco-cessation efforts.

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