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Shaheen, Blumenthal Reintroduce Bill to Crack Down on E-Cigarette Companies & Close Tax Loophole on Advertising

(Washington, DC) – Today, U.S. Senators Jeanne Shaheen (D-NH) and Richard Blumenthal (D-CT) reintroduced the No Tax Subsidies for E-Cigarette and Tobacco Ads Act, which would crack down on e-cigarette companies and close a tax loophole that allows manufacturers to claim federal tax deductions for the cost of advertising for e-cigarettes and tobacco products. 

In November 2022, the Food and Drug Administration (FDA) and Centers for Disease Control and Prevention (CDC) released federal data showing that over 3 million middle and high school students had used a tobacco product during the past 30 days. This comes as youth e-cigarette use rose 1,800 percent from 2011 to 2019. More than 30 percent of teens who start using e-cigarettes begin smoking traditional tobacco products within six months. More than 25 percent of current youth e-cigarette users use an e-cigarette product every day. Over 85 percent of user use fruit flavors. Amongst students surveyed, those who use social media found that 73.5 percent of students have seen e-cigarette related content.

“E-cigarette and Big Tobacco companies must be held accountable for their use of targeted advertisements towards young people. These dangerous products are fueling a public health crisis – especially among teenagers,” said Shaheen. “Taxpayers should not foot the bill for these harmful marketing campaigns. That’s why I’m reintroducing this critical legislation, which will close a tax loophole that allows companies to write off the costs of their ads and hold e-cigarette companies responsible.”

“Tax breaks for tobacco and e-cigarette giants allow the industry to profit from its manipulative marketing. Our legislation ends these write-offs to protect kids and other consumers from being lured into lifetimes of addiction. I’m proud to join Senator Shaheen in this effort to stop Big Tobacco from hooking the next generation,” said Blumenthal.

Television and radio advertising for traditional tobacco products have been banned under federal law, and certain other forms of Big Tobacco advertising are restricted under the 1998 Tobacco Master Settlement Agreement. However, none of these restrictions apply to e-cigarettes. While some television outlets have started pulling e-cigarette ads from the air in response to the ongoing youth vaping crisis, the ads are still being run by other outlets. To ensure parity between e-cigarettes and traditional tobacco, the Shaheen and Blumenthal bill also bars tax deductions for advertising expenses related to tobacco cigarettes, cigars, snuff, chewing tobacco, pipe tobacco, and roll-your-own tobacco.

Senators Brown (D-OH), Reed (D-RI) Durbin (D-IL) and Merkley (D-OR) also joined in reintroducing this bill.

Full text of the legislation is available here.

Senator Shaheen has led efforts in the Senate to tackle the youth vaping crisis. She led the bipartisan, bicameral introduction of the Resources to Prevent Youth Vaping Act, which would require that e-cigarette manufacturers pay user fees to the Food and Drug Administration (FDA) to help to fund more activity at the FDA to conduct stronger oversight of the e-cigarette industry and increase awareness for the danger of e-cigarettes. In the FY 2023 government funding bill, Shaheen helped negotiate more than $2.408 billion in funding for the Substance Abuse Prevention and Treatment Block Grant. The proposal also includes report language added by Shaheen to address youth e-cigarette use and encourages NIDA to support research to develop therapies to combat pediatric nicotine addiction. Earlier this year, Shaheen joined a bipartisan group of Senators in calling on the Food and Drug Administration (FDA) to take long-overdue action to combat the youth vaping crisis, including steps that could remove kid-friendly, addictive e-cigarettes from the market.