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Commonwealth Foundation


Senate Committee Advance Vape Tax Fix

by News Release
 

Senate Committee Advances Vape Tax Fix
Dozens of Shop Closures Prompt Action on Onerous E-Cigarette Tax

April 26, 2017, Harrisburg, Pa.–Today, in the latest attempt to fix an onerous tax responsible for as many as 100 vape shop closures across the state, the Senate Finance Committee advanced SB 508 to the Senate floor. The legislation, sponsored by Sen. Camera Bartolotta, would rescind a 40 percent retroactive wholesale tax on e-cigarettes and related vapor products imposed in 2016 and replace it with a less destructive 5-cents-per-milliliter tax.

"Last year's vape tax decimated nearly one-third of the state's vape shops," commented Bob Dick, senior policy analyst for the Commonwealth Foundation. "Dozens of entrepreneurs saw their livelihoods taxed away from them to feed government's spending habit, and even more workers lost their jobs as a consequence. It's time to fix this industry-killing tax and stop punishing Pennsylvanians for pursuing their dreams."

In February, Tony Myers announced the closure of his vape shop in Hanover, which employed adults with special needs. He spoke glowingly of his business because it instilled purpose in his employees' lives. But the 40 percent wholesale tax has driven Myers to Florida.

Myers is one of dozens of small business owners forced to close up shop and lay off workers due to the onerous wholesale tax targeting their industry.
"The full Senate should act quickly to pass this vape tax fix before more shop owners shut their doors for good," continued Dick. "Lawmakers must take advantage of this opportunity to send the message that Pennsylvania welcomes job creators."

Similar legislation, sponsored by Rep. Jeff Wheeland, made it to the House floor last year but never received a vote and will be reintroduced this session.

Bob Dick and other Commonwealth Foundation experts are available for comment. Please contact Gina Diorio at 862-703-6670 or gld@commonwealthfoundation.org to schedule an interview.
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The Commonwealth Foundation transforms free-market ideas into public policies so all Pennsylvanians can flourish.


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