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E-cigarette taxes may drive vape users to traditional smokes, study says

E-cigarette taxes may drive vape users to traditional smokes, study says
Vaping taxes may drive conventional cigarette sales, study finds. File photo by kevsphotos/Pixabay

Feb. 10 (UPI) -- Policies designed to discourage vaping may have unintended consequences -- namely, encouraging other forms of tobacco use -- a new study has found.

In an analysis posted online Monday by the National Bureau of Economic Research, the authors conclude that raising taxes on e-cigarettes, or vaping devices, as a disincentive to consumers may drive people to purchase more traditional cigarettes.

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Several states have implemented special taxes on vaping products, in addition to outright bans, in an effort to curb their use.

"We estimate that for every one e-cigarette pod no longer purchased as a result of an e-cigarette tax, 6.2 extra packs of cigarettes are purchased instead," study co-author Michael Pesko, an economist at Georgia State University, said in a press release. "The public health impact of e-cigarette taxes in this case is likely negative."

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As of January, 20 states have an e-cigarette tax, and Congress is considering enacting a federal tax on vaping products because of concerns that began to rise last summer. In October 2019, the United States House Ways and Means Committee approved an e-cigarette tax with bipartisan support that set a national e-cigarette tax proportional to the Federal cigarette tax.

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The measure has yet to receive full Congressional approval, however.

Pesko and his colleagues analyzed scanner data from 35,000 retailers nationally over a seven-year period, finding that for every 10 percent increase in e-cigarette prices, e-cigarette sales drop 26 percent.

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However, the same 10 percent increase in e-cigarette prices causes traditional cigarette sales to jump by 11 percent, they noted.

"Although vaping-related illnesses are a public health concern, cigarettes continue to kill nearly 480,000 Americans each year, and several reviews support the conclusion that e-cigarettes contain fewer toxicants and are safer for non-pregnant adults," said researcher Erik Nesson, an economics professor in the Miller College of Business at Ball State. "Thus, balancing e-cigarette and cigarette use will continue to be an important issue for policymakers to consider as they develop e-cigarette related tobacco control policies."

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