If you are a vaper who lives in Pennsylvania, you are more than aware of how policy, regulation, and taxation has affected the industry. Prices are high, vape shops are suffering, and employment in the vaping industry has decreased due to government interference.
The 40% Tax that is Killing the PA Vaping Industry
Facing yet another budget shortfall in 2016, Governor Tom Wolf and his fellow lawmakers placed the now-infamous 40 percent wholesale tax on vaping products. This, of course, caused vape shop owners to pay the tax retroactively — even on products that were already on their store shelves.
This clear money-grabbing scheme has made a huge impact on small business owners and vapers alike — a very negative one, unfortunately. Consider this statistic: out of the 311 vape shops that were open for business in 2016 in Pennsylvania, 30 percent have shut their doors permanently due to the ridiculous anti-vaping policies and taxation that have hit the state.
Bob Dick, the senior policy analyst for the Commonwealth Foundation stated that “This tragedy should be a cautionary tale to both lawmakers and taxpayers as the state budget is hammered out over the next few weeks […] Instead of addressing overspending, last year Gov. Wolf and lawmakers targeted vape shop owners with business-killing tax.”
In typical political fashion, Gov. Wolf would rather tax small businesses into oblivion for short-term money in the coffers, rather than take a look at the government’s mis-spending and terrible budgeting. Once vaping no longer offers them the funds they need to overspend at their own whim, there will undoubtedly be another industry that will become a scapegoat for overspending.
The Ignorance of Anti-Vaping Taxation: A Ploy for the Rich
As if crushing a third of the vape shops in PA wasn’t enough, which is around 100 shops, the loss of employment for each of those businesses and most customers resuming smoking damaging cigarettes was also a result.
While the state government took a huge chunk from the vaping industry in Pennsylvania, they turned around and gave politically-favored businesses $800 million in taxpayer-backed handouts. This includes $250 million to the horse racing industry alone — the injustice of this demonization of vaping is ridiculous and the misuse of state funds to favor politically-supported businesses is simply corruption.
What Governor Wolf needs to do is eliminate the unfair corporate welfare spending and allow the harm-reduction methods like vaping to help save lives without being taxed into oblivion. What the state government has done here is take away the livelihood of hundreds of small business owners, even more employees who are now without work, and have harmed consumers who can no longer afford to vape — these people will now turn back to cigarettes, which will increase their likelihood of disease and health problems.
Senate Bill 508
One positive is the introduction of Senate Bill 508, which is sponsored by Senator Camera Bartolotta — this bill, if passed, would repeal the 40 percent wholesale tax and replace it with a less-severe 5 cents per milliliter tax.
The Senate Finance Committee already advanced the bill back in April, but it hasn’t been scheduled for a vote on the floor just yet.
We will keep an eye on the bill and let you know the result of this potentially life-changing policy for Pennsylvania consumers and business owners.