A proposed federal ban on menthol cigarettes has underscored the tension lawmakers face in using so-called “sin tax” revenue to fund critical social programs at the state and federal levels.
For decades, states have used sin taxes — excise taxes placed on things like tobacco, alcohol and gambling — for health, education and other public programs. Revenue has fallen over the years along with smoking rates, and the Food and Drug Administration’s recent proposal to ban menthol cigarettes and flavored cigars could trigger an even sharper decline.
A rise in e-cigarette popularity presents a new opportunity to fill the gap, even as vaping advocates allege that taxes discourage traditional smokers from switching to a potentially less harmful product. More than half of states are now taxing e-cigarettes, although an increasing number are attempting to ban most flavored nicotine products outright.
