President Trump Proposes New User Fees For E-cigarettes

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President Trump Proposes New User Fees from E-cigarettes

User fees are nothing new and have been a contentious subject among manufacturers of tobacco products. Makers of cigarettes, roll-your-own tobacco, snuff, chewing tobacco, cigars and pipe tobacco have all had to deal with increasing user fees levied by the U.S. Food and Drug Administration (FDA) over the years. For the 2018 fiscal year, user fees across all categories amounted to $168,000.00 per quarter, totaling to $672,000 per year [read more here]. Those user fees, however, never applied to e-cigarette manufacturers-until now.

In his proposed budget, President Trump wants the e-cigarette industry to start paying user fees that other covered tobacco products have been paying for some time now. In total, the e-cigarette industry would pay $100 million a year in user fees. The fees would help support increasing FDA regulatory oversight efforts. These increased user fees imposed on e-cigarettes were introduced in this year’s budget as a response to the FDA’s ongoing focus on youth access and use of e-cigarette products and the perceived threat to their health and exposure to nicotine. If passed, manufacturers and importers of vaping devices and products including e-cigarettes and e-liquids will have to pay this fee to do business.

The Trump Administration is asking for $6.1 billion for FDA funding, around nearly $418.5 million more in the current budget. $2.8 billion of that money will come from proposed user fees on drug and other industries, devices and the new user fees imposed on the e-cigarette industries. The Center for Tobacco Products, part of the FDA, is entirely funded by user fees. The more money this agency has, the more they will be able to address and combat its perceived “epidemic” of youth using e-cigarette and vaping products.

In a statement to The Washington Post, Liz Mair of Vapers United criticized this proposed budget and the user fee, calling the user fee a tax that is proposed by “Republicans and conservative Democrats … when they’re about to hike taxes but don’t want to admit that’s what they’re dong.”

In past years, those manufacturers who were already paying user fees often questioned the reasoning behind sparing e-cigarettes of this fee. With the use of traditional combustible tobacco products on the decline and the use of e-cigarettes and vaping devices on the increase, the new e-cigarette user fee proposal isn’t that surprising. While the e-cigarette and vape industries have often touted their products as being the “safer” alternative to those seeking to ditch smoking and tobacco use, the government has grouped e-cigarettes in the same category as tobacco products. This has created some tension between these different manufacturers who have tried to explain the difference between each industry’s products, devices and customer base.

Congress would have to approve of the new budget before the user fees would formally be imposed. With the growing concerns regarding youth e-cigarette use and vaping, members of both political parties have voiced the support of any measures taking by the FDA and the government to address the problem.

For all the latest legislation and FDA news impacting the tobacco industry, click here.