Saturday, June 8, 2013

Call to Action! Delaware Bill to Impose 30% Tax on E-Cigarettes and Smokeless Tobacco -- HB 138 (DEFEATED)

UPDATE (6/2/2013): On Wednesday, June 5th, the Delaware General Assembly Revenue & Finance Committee met to hear testimony on HB 138, a bill that would have redefined a "tobacco product" under Delaware tax law to include e-cigarettes containing nicotine. The bill would have also increased the tax on "tobacco products" other than cigarettes from 15% to 30% of wholesale, with the tax hike also impacting smokeless and dissolvable tobacco. CASAA Legislative Director Gregory Conley was in attendance and testified against the bill.

Like in New Mexico and Maine -- where bills with similar redefinitions failed this year -- the sponsor of HB 138, Rep. Michael Barbieri, indicated that it was never his intention to tax e-cigarettes (although that would have been the effect of the bill). Rep. Bariberi was amenable to amending the bil to specifically exclude e-cigarettes. In the end, this didn't happen, as it was clear that he didn't have the votes to pass the bill. The committee voted overwhelmingly to table the bill, and with Delaware's legislative session ending in approximately 3 weeks, it's very doubtful that it will be brought back.

CASAA would like to thank the harm reduction advocates who responded to our Call to Action, and a big thanks to those who testified at the hearing. Like with New Mexico and Maine earlier this year, this was a great educational opportunity for Delaware legislators.


Delaware: Bill to Tax E-Cigarettes at 30% of Wholesale Price + Double Tax on Smokeless Tobacco -- HB 138

[full text + legislative tracking]

If enacted, this bill wold:
  1. Tax electronic cigarettes by redefining "tobacco products" under Delaware tax law to include any product "made or derived from tobacco that is intended for human consumption . . . or any component, part, or accessory of a tobacco product."
  2. Impose a wholesale tax on all smoke-free products (e-cigarettes, smokeless tobacco, dissolvable tobacco) of 30%.  E-cigarettes are not currently taxed under Delaware law, but enactment of this bill would constitute a 100% increase for adult smokeless tobacco consumers.  The Delaware Department of Finance will be given the power to decide whether this tax would be applied to e-cigarette disposables, liquid, mods, cartomizers, atomizers, batteries, etc. 
  3. Require e-cigarette vendors to obtain a tobacco retail license to sell e-cigarettes (see Title 30, §5307)
  4. Make it a crime punishable by up to 90 days in jail and a $1,000 fine for a Delaware citizen to have more than ten "packages" of untaxed e-cigarettes.  (see Title 30, §5342). 
If you may be able to testify against this bill when it gets a committee hearing in Dover, Delaware, please e-mail us at board@casaa.org. Please use the subject line "DE Testimony."

If you are from Delaware, please also contact your representative in the Delaware General Assembly and tell them that you're an e-cigarette or smokeless tobacco user, you vote, and you don't want the unnecessary tax hike in HB 138 to become law.

Please call, write, or fax the members of the Delaware Revenue & Finance Committee below:

1. You oppose HB 138 because it would impose a new, unwarranted tax on smoke-free electronic cigarettes. Further note that HB 138 would tax not only e-cigarette disposables and liquid that contains nicotine, but also permits the taxation of hundreds of "components, parts, [and] accessories" like kits, mods, atomizers, cartomizers, and even batteries.

2. Tell your story on how switching to an e-cigarette or smoke-free tobacco product has changed your life.

3. Explain that the purpose of increasing cigarette taxes has been to cover governmental healthcare expenditure caused by smoking and to discourage smoking. But since electronic cigarettes, smokeless tobacco, and dissolvables are 98-99% less hazardous than cigarettes, there is no fiscal or public health justification for such a hefty tax.

4. Tell them that this year, committees in the Maine and New Mexico legislatures rejected bill with similar broad redefinitions of "tobacco products." 

5. Note that thousands of Delaware consumers purchase e-cigarettes through online suppliers each year. Under HB 138, these consumers could be punished with jail time if they do not pay this new tax to the Delaware government. This is bad public policy.

6. Since many/most e-cigarette sales are made online, enactment of this legislation would negatively impact businesses in Delaware that sell e-cigarettes, as many consumers would choose to use out-of-state and international online suppliers.

7. Many smokers who switch to less hazardous electronic cigarettes do so because e-cigarettes are less expensive than cigarettes. Increasing the costs of e-cigarettes to that of cigarettes would discourage many smokers from switching to e-cigarettes. It could also encourage some e-cigarette consumers to go back to cigarette smoking.


Members of the Delaware Revenue & Finance Committee + Bill Sponsors

Comma delimited e-mail list: helene.keeley@state.de.us, paul.baumbach@state.de.us, andria.bennett@state.de.us, stephaniet.bolden@state.de.us, ronald.gray@state.de.us, jj.johnson@state.de.us, quinton.johnson@state.de.us, jack.peterman@state.de.us, michael.ramone@state.de.us, jeff.spiegelman@state.de.us, john.viola@state.de.us, dennis.e.williams@state.de.us

Rep. Helene M. Keeley (D - Wilmington South) (District 3) (Chairwoman)
Legislative Phone: (302) 744-4351
Outside Office Phone: (302) 577-8476
Outside Ofice Fax: (302) 577-6701
E-mail: helene.keeley@state.de.us

Rep. Paul S. Baumbach (D - Newark) (District 23) (Vice Chairman)
Legislative Phone: (302) 744-4351
Legislative Fax: (302) 739-2313
Outside Office Phone: (302) 577-8342
Outside Office Fax: (302) 577-6701
E-mail: paul.baumbach@state.de.us

Rep. Andria L. Bennett (D - Dover) (District 32)
Legislative Phone: (302) 744-4351
Legislative Fax: (302) 739-2313  
E-mail: andria.bennett@state.de.us

Rep. Stephanie T. Bolden (D - Wilmington) (District 2)
Legislative Phone: (302) 744-4351
Legislative Fax: (302-739-2313
Outside Office Phone: (302) 577-8453
Outside Office Fax: (302) 577-6701
Home Phone: (302)-428-1269
E-mail: StephanieT.Bolden@state.de.us

Representative Ronald E. Gray (R - Frankford) (District 38)
Legislative Phone: (302) 744-4171
E-mail: Ronald.Gray@state.de.us

Representative James Johnson (D - Dover South) (District 16)
Legislative Phone: (302) 744-4351
Legislative Fax: (302) 739-2313
Outside Office Phone: (302) 577-8476
Outside Office Fax: (302) 577-6701
Home Phone: (302) 322-3521
E-mail: jj.johnson@state.de.us

Representative S. Quinton Johnson (D - Middletown) (District 8) 
Legislative Phone: (302) 744-4351
Legislative Fax: (302) 739-2313
Outside Office Phone: (302) 577-8476
E-mail: Quinton.Johnson@state.de.us

Representative Harold J. Peterman (R - Frederica) (District 33)
Legislative Phone: 302-744-4171
Legislative Fax: 302-739-2773
Alt Phone: 302-335-4261
E-mail: jack.peterman@state.de.us

Representative Michael Ramone (R - Middle Run Valley) (District 21)
Legislative Phone: (302) 744-4108
Legislative Fax: (302) 739-2773
Outside Office Phone: (302) 577-8723
Outside Office Fax: (302) 577-6396
Alt Phone: (302) 584-8601  
E-mail: Michael.Ramone@state.de.us

Representative Jeffrey N. Spiegelman (R - Wilmington) (District 11)
Legislative Phone: (302) 744-4171
Outside Office Phone: (302) 577-8723
Alt Phone: (302) 399-7728  
E-mail: jeff.spiegelman@state.de.us

Representative John J. Viola (D - Newark) (District 26)
Legislative Phone: (302) 744-4351
Outside Office Phone: (302) 577-8187
Outside Office Fax: (302) 577-6701
Alt Phone: (302) 832-2209
E-mail: John.Viola@state.de.us

Representative Dennis E. Williams (D - Talleyville) (District 10)
Legislative Phone: (302) 744-4351
Legislative Fax: (302) 739-2313
Outside Office Phone: (302) 577-8476
Outside Office Fax:(302) 577-6701
Alt Phone: (302) 373-0115
E-mail Address: Dennis.E.Williams@state.de.us


Bill Sponsors -- If you live in their city or cities, please contact them

Representative Michael A. Barbieri (D - Newark) (District 18)
Legislative Phone: (302) 744-4279
Outside Office Phone: (302) 577-8342
Alt Phone: (302) 420-6564  
E-mail: michael.barbieri@state.de.us

Representative Debra J. Heffernan (D - Bellefonte, Claymont, Edgemoor) (District 6)
Legislative Phone: 302-744-4351
Work Phone: 302-577-8476
Home Phone: 302-762-3478
E-mail: debra.heffernan@state.de.us

Representative Earl G. Jaques Jr (D - Glasgow) (District 27)
Legislative Phone: (302) 744-4142
Legislative Fax: (302) 739-2313
Outside Office Phone: (302) 577-8342
(NO E-MAIL)

Representative Charles Potter Jr. (D - Dover) (District 1)
Legislative Phone: (302) 744-4351
Legislative Fax: (302) 739-2313
Outside Office Phone: (302) 577-5312
Outside Fax: (302) 577-6701
Alt Phone: (302) 762-8322
Alt Fax: (302) 652-2411
E-mail: Charles.Potter@state.de.us

Senator Margaret Rose Henry (D - Wilmington East) (District 2) (SENATE PRIMARY SPONSOR)
Legislative Phone: (302) 744-4191
Outside Office Phone: (302) 577-8719
Alt Phone: (302) -425-4148
E-mail: MargaretRose.Henry@state.de.us

Senator Patricia M. Blevins (D - Elsmere) (District 7)
Legislative Phone: (302) 744-4133
Outside Office Phone: (302) 577-8542
Outside Office Fax: (302) 577-3269
E-mail: Patricia.Blevins@state.de.us

Senator Ernesto B. Lopez (R - Lewes) (District 6) 
Legislative Phone: (302) 744-4136
Legislative Fax: (302) 739-5049
Alt Phone: (302) 598-7669
E-mail: Ernesto.Lopez@state.de.us

Senator Bryan Townsend (D - Newark) (District 11)
Legislative Phone: (302) 744-4165
Outside Office Phone: (302) 577-5316
Alt Phone: (302) 709-1516
E-mail: Bryan.Townsend@state.de.us 

1 comment:

Rick Mulder said...

Wow, a very personal response from Representative Jeff Spiegelman, who asked:
"If I may ask you a question; would you be in support of this bill if it was amended to remove the tax on electronic cigarettes?"

I responded to hime with my thoughts on that question.
What are your thoughts?