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Whitmer supports vape taxes, some legislators aim for licenses

LANSING — At the tail end of Gov. Gretchen Whitmer’s State of the State address, she supported legislation aimed at taxing vapes.

“If we don’t act smart on vapes, we risk our children’s health and futures,” she said.

Democratic legislators stood for applause. Republicans remained seated.

Whitmer’s 2025-26 budget proposal recommends $2.5 million to administer and collect a proposed vape tax.

But House Speaker Matt Hall, R-Richland Township, strongly opposes the tax, reflecting the sentiment of the Republican majority in the House.

“There’s no chance,” Hall said of the unlikelihood of the tax’s passage.

Sen. Sam Singh, D-East Lansing, said he is unsure whether legislation to tax vapes will make it to the floor of the Democratic-controlled Senate this session.

But this spring, Singh, who is the Senate minority leader, plans to reintroduce a bill that would create an annual tobacco retail license requirement for businesses selling vapes, generating revenue for undercover sting operations to combat underage sales.

Jodi Radke of Washington D.C.-based advocacy group Campaign for Tobacco-Free Kids previously worked closely with Singh on similar legislation.

She said the vape tax budget allocation could fund police operations to enforce the terms of the proposed licenses.

Fourteen percent of Michigan high schoolers reported using vapes, according to 2023 Department of Health and Human Services data.

That same year, 656 stores in the state illegally sold tobacco products to underage undercover agents as a part of a U.S. Food and Drug Administration sting operation.

Thousands of underage sales take place without consequence in Michigan due to the lack of a licensing system, Rathke said.

“Kids are self-reporting that they are able to directly go in and buy vapes from the store,” Radke said. “Our federal data for these compliance checks confirm or affirm that self-report.”

Such a licensing system would fund unannounced compliance checks to catch retailers selling tobacco to minors, she said.

In most of the 38 states with tobacco licensing systems, checks are carried out by agents posing as underage customers who attempt to buy restricted products.

License application fees and Whitmer’s proposed $2.5 million budget allocation could partially fund law enforcement operations like that, Rathke said. Punishment for initial offenses would be fines, which would escalate to license suspensions for multiple violations.

Singh’s tobacco license legislation from 2024 would have created the Nicotine and Tobacco Regulation Fund, managed by the state Department of Licensing and Regulatory Affairs.

Tobacco retail license fees and fines would be spent on enforcement under the proposal.

Last year, members of the Michigan Association of Convenience Stores — representing over 1,500 gas stations and other retailers that derive significant revenue from tobacco products — worked with Singh to develop the legislation.

Association president Mark Griffin said he opposed the final version, citing concerns over the $1,500 application fee.

“It really was just a big money grab, an attempt to get an extra $6 to $10 million a year out of an industry that is already paying $700 million a year in taxes,” he said.

Last year, Republican pushback against Singh’s vape legislation centered around the tax and another bill to ban flavored tobacco products.

While Singh isn’t aiming to ban flavors, he said a licensing system would fund enforcement of federal bans on vapes that are not FDA-approved.

Vapes that have non-menthol flavors cannot be legally sold in the U.S., and only 34 e-cigarette products — all Logic, NJOY or Vuse brands — are authorized for sale.

Singh said he hopes this year’s legislation can be bipartisan.

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