Sheridan Nolen

Ohio Legislators Keep Focus on Job-Creating Occupational Licensing Reforms

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Posted by Sheridan Nolen on Wednesday, March 31st, 2021, 12:08 PM PERMALINK

Senate Bill 131, sponsored by Sen. Kristina Roegner and Sen. Rob McColley, along with its companion House Bill 203 by Rep. Jena Powell, would enact occupational license reciprocity. Under these bills, individuals who hold out-of-state occupational licenses (e.g. electricians, truck drivers, public accountants, etc.) would be recognized in Ohio if the individual is in good standing with their professional, maintains proficient work experience, and meets the minimum educational requirements.  

Too many licenses have been created at the behest of politically connected interests to restrict competition. Currently, Ohio licenses 651 occupations, which is around 18% of professions. Even worse, occupational licensing in Ohio has led to significant job loss. A study from the Institute for Justice found that Ohio has lost over 67,000 jobs due high licensing burdens, as well as over $209 million in deadweight losses in addition to the misallocation of over $6 billion.  

“Universal licensure reciprocity makes sense,” said Sen. Roegner. “If someone has been trained and licensed in one state then they should not have to jump through hoops to be licensed in another state. In theory this is similar to getting a driver’s license. How awful would it be to have to be re-licensed in each state where you want to drive! This bill will say to those licensed professionals, ‘come to Ohio, you and your skills are welcome here.’” 

Moreover, a study from The Buckeye Institute shows that older, lower-income workers, and those without a college degree, are all particularly disadvantaged by licensing barriers. By passing SB 131 and HB 203, individuals in these demographics would see an expansion in job opportunities and, in turn, economic prosperity.  

Rea S. Hederman Jr., Executive Director of the Economic Research Center at The Buckeye Institute, said, “Ohio has a long-standing challenge in attracting and retaining workers due in part to its burdensome occupational licensing requirements. Adopting universal licensing recognition…will make Ohio a more attractive place for workers to move to and it will make it easier for licensed workers to start earning a living.”   

In the past, Ohio has been a leader in occupational licensing reform by implementing a sunset review process and licensing recognition for military spouses. Other states, like Arizona, Pennsylvania, Utah, Montana, Idaho, Iowa, and Missouri, however, have already passed reforms similar to SB 131 and HB 203. To keep Ohio at the front of the race with competing states, lawmakers should pass Universal Licensing Recognition through SB 131 and HB 203. 

Photo Credit: Firesign

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Oregon Lawmakers Seek Beer and Wine Tax Hike

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Posted by Sheridan Nolen on Tuesday, March 9th, 2021, 5:07 PM PERMALINK

State officials around the country have aimed to help struggling restaurants, bars, breweries, and wineries by deregulating sales restrictions during the COVID-19 shutdown. While these measures were initially temporary, their popularity and success has led to many states making these changes permanent.

Lawmakers in Oregon, however, are looking to do the exact opposite of helping struggling businesses. Under House Bill 3296, two of the state’s top industries for tourism – breweries and wineries – would be slammed with a massive tax hike. HB 3296 calls for a 2,700% tax increase on beer and a 1,500% tax increase on wine.

Right now, Oregon has some of the lowest tax rates on beer and wine in the entire country; the current tax on a barrel of beer is $2.60 (8.4¢ per gallon) and the wine tax is 67¢ per gallon. If HB 3296 is passed, the taxes on barrels beer and wine would rise to $72.60 and $10.67, respectively. This massive tax hike would cripple the Oregon beer and wine industry, possibly forcing businesses to shut down altogether. In fact, if this bill passes, some business owners say they would pay more in taxes than what they make in net profits.

"First of all, it's a ludicrous tax. To go from $2.60 cents to $72.60 is actually like just bonkersville," said John Harris, founder and brewmaster of Ecliptic Brewing in Portland. "This proposal...would cost me $840,000 dollars. I don't make $840,000 a year.”

Alex Sokol, co-president of Sokol Blosser Winery and Evolution Wines in Yamhill County, said it would be “cheaper for someone to buy our wine in New York City, and have it shipped here than to buy it from your local grocery store.”

Before the pandemic, the beer industry in Oregon brought in $6.6 billion in sales and supported 43,000 jobs in the state. The Beer Institute estimates, however, that Oregon’s beer industry lost 9,303 jobs and experienced a $263 million decline in sales as a result of the COVID-19 pandemic. According to an economic impact study by the Oregon Wine Board, over 11,000 jobs were lost from the wine industry along with over $1.4 billion in economic impacts by the end of 2020.

The proposed excise tax increases would result in additional unnecessary destruction to industries that play an important role in the state economy. Many jobs are already at-risk or have been lost – a tax increase would only make it significantly harder for local business to get back on their feet and to keep Oregon’s economy on a path forward to recovery. By imposing a punitive tax that will drive up the cost of beer and wine sold in Oregon, state lawmakers would be taking fiscal policy in the wrong direction, harming employers and consumers with a regressive tax hike at a time when tax relief is what is needed.

Photo Credit: Karen Neoh

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It’s Not Just Blue States Where Surprise Tax Bills Are A Threat This Spring

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Posted by Sheridan Nolen on Wednesday, March 3rd, 2021, 2:03 PM PERMALINK

As in many state capitals, lawmakers in North Carolina are currently debating whether or not to fully conform with all of the tax relieving and liquidity enhancing provisions in the Coronavirus Aid, Relief, and Economic Security (CARES) Act relief package approved by Congress last April.

North Carolina legislators have already conformed to the CARES Act’s tax exemption for forgiven PPP loans, approving that state level tax exemption last Spring. This conformity, which most other states have followed suit in enacting, or are in the process of passing, ensures that businesses who have been able to remain open with the help of a PPP lifeline will not be hit with a surprise state income tax bill. Right now, 29 states, including neighboring South Carolina, will not tax forgiven PPP loans. 

While North Carolina lawmakers have exempted forgiven PPP loans from state taxation, they have not permitted the same payroll deduction authorized federally, nor have they permitted the code to conform with the other liquidity enhancing provisions of the CARES Act. Americans for Tax Reform recently sent a letter to legislators in North Carolina urging them to pass legislation doing just that.

Legislation to accomplish this goal, Senate Bill 104, was introduced on February 27 by Senators Jim Perry, Chuck Edwards and David Craven. It’s ATR’s position that North Carolina legislators should not tax employers’ pandemic relief aid, nor do they even need to, as the state has a reported $4 billion budget surplus.

In addition to the PPP loans, the CARES Act increased business liquidity in a time of crisis by reducing existing limitations on business interest expenses subject to deduction in tax years 2019 and 2020; eliminating loss limitations for noncorporate taxpayers that were enacted as part of the 2017 Tax Cuts & Jobs Act (TCJA) for tax years 2018, 2019, and 2020; and relaxing the TCJA’s limitation of NOL deductions, permitting a five-year carryback of NOLs generated in tax years 2018, 2019, and 2020.

The last thing struggling small businesses need right now is a surprise tax bill brought on by acceptance of pandemic aid. Enactment of SB 104 will prevent that from happening in North Carolina. By passing SB 104, which would have North Carolina’s tax code conform to the other liquidity-increasing provisions of the CARES Act, North Carolina lawmakers will boost the job-creating and sustaining capacity of employers at a critical time for many businesses.

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HB 2454 Would Expand Access to Health Care in Arizona

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Posted by Sheridan Nolen on Monday, March 1st, 2021, 3:21 PM PERMALINK

Arizona could soon become a model state for telemedicine and telehealth. 

Rep. Regina Cobb’s House Bill 2454 would remove a number of barriers that block the use of telemedicine and telehealth services in the Grand Canyon State. If implemented, this bill would give Arizonans access to some of the nation's best innovative technologies in the health care industry.

“Arizona is a leader when it comes to innovative policy solutions,” said Grover Norquist, president of Americans for Tax Reform. “It was the first state in the country to grant universal license recognition, making it easier for new residents to get jobs. Now, thanks to Rep. Cobb’s leadership, Arizona could soon become one of the most telemedicine friendly states in the country.”  

HB 2454 would change the word “telemedicine” to “telehealth” in Arizona statutes, which is more inclusive of providers that are not physicians. Among other things, this bill would also allow patients and providers to engage in audio-only telephone visits; would allow for the use of asynchronous, or store and forward, telehealth to be used to establish provider-patient relationships and to prescribe; and would allow healthcare providers who are licensed and in good standing in other states to provide telehealth services to Arizonans. 

Together, these reforms would be a huge win for patients and consumers across Arizona, as they would no longer be forced to take off of work or school and take on the costs and complications of driving to an in-person appointment. By making it easier for Arizonans to connect with health care providers, HB 2454 would increase the odds of problems being caught while they are small, manageable, less expensive. 

“Telehealth helps ensure Arizonans have access to safe and reliable medical services,” tweeted Gov. Ducey in support of the legislation. “It expands resources for those in need and in rural areas, and it helps protect vulnerable populations. Arizona is proud to lead on this issue!” 

To fight COVID-19, Gov. Ducey issued orders that allowed Arizonans to temporarily benefit from a number of the reforms included in Rep. Cobb’s bill. In addition to making it possible for Arizonans to access medical providers without having to risk getting sick in a doctor’s office or hospital, those orders were also a big win for people living in rural areas, who may not have great access to health care in general, and those in need specialists located several hours away. 

Indeed, a study by the Journal of Medical Internet Research concluded that the vast increase in telehealth medicine users in 2020 was not fueled by COVID-19 concerns, but by visits for other health concerns for patients who had difficulty accessing care. 

HB 2454 would make Arizona a national leader in telemedicine and telehealth. This would be a huge win for all Arizonans, as it will increase the number of options for patients, improve quality of care, and naturally drive the costs down. 

Photo Credit: NEC Corporation of America

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Will New Hampshire Become the Next Right-to-Work State?

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Posted by Sheridan Nolen on Thursday, February 25th, 2021, 2:48 PM PERMALINK

New Hampshire may soon join the list of 27 right-to-work states, giving private sector workers the freedom to choose whether or not they join and pay dues to a union. This would be a huge win for employees across the Granite State and a boon to the economy. 

Thanks to the U.S. Supreme Court’s 2018 ruling in Janus v. AFSCME, public sector workers in New Hampshire and across the country are no longer forced to pay union dues as a condition of employment. That landmark victory for workplace freedom, however, did not apply to private sector unions. Private sector employees in states that do not have right-to-work laws in place still do not have this basic right to choose.  

But now that New Hampshire is back under Republican control, there is a strong chance that things will soon change. Sen. John Reagan’s Senate Bill 61, which was recently approved by the Senate in a 13-11 vote, would prohibit collective bargaining agreements from including mandatory union dues, making New Hampshire the 28th right-to-work state. This commonsense law, if enacted, would give New Hampshire private sector workers the freedom to exercise their First Amendment right to decide to associate or not associate with an organization and give them the option to keep more of their hard-earned paychecks. 

In addition, SB 61 is also smart economic policy. Scholarly research over the years has found that right-to-work states are more prosperous than forced-unionism states. The National Institute for Labor Relations Research, for example, found that the percentage growth in the number of people employed from 2009-2019 was 16.9% for right-to-work states and just 9.6% in forced unionism states.  

These findings are not surprising. Right-to-work laws make states significantly more attractive to businesses looking to expand. John Boyd, founder of the Boyd Company, a business consulting firm that advises where to make job-creating investments, explained that right-to-work is a “common denominator among states attracting both aerospace and other types of advanced manufacturing.” 

“I believe right-to-work, along with lower business taxes and workers compensation costs, will make New Hampshire more competitive and attractive to grow and locate a business,” said Senate Majority Leader Jeb Bradley, who is a cosponsor of the bill. 

Joining Sen. Reagan and Leader Bradley as co-sponsors of SB 61 are Senate President Chuck Morse, Sen. Gary Daniels, Sen. Bill Gannon, Sen. James Gray, Sen. Harold French, Rep. Richard Marston, Rep. Carol McGuire, Rep. Alicia Lekas, and Rep. James Spillane. SB 61 has been placed at the top of House Speaker Sherman Packard’s legislative agenda and Gov. Chris Sununu, a longtime supporter of right-to-work laws, is expected to sign the bill into law if it reaches his desk.  

Finally making New Hampshire a right-to-work state would be a win for all residents of the Granite State. It would give private sector employees the freedom to choose how they wish to assemble and allow them to keep more of their hard-earned paychecks, while also attracting new jobs and opportunities. 

Photo Credit: James Walsh

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Two Massive Tax Hikes at Stake in Pennsylvania Budget Fight

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Posted by Sheridan Nolen on Wednesday, February 24th, 2021, 11:10 AM PERMALINK

Despite the grueling effects of the pandemic-induced recession, Gov. Tom Wolf of Pennsylvania has proposed the largest tax hike in Pennsylvania history in his executive budget.  

The budget proposal includes a massive, job-killing 46% increase in the state income tax. 

Gov. Wolf’s proposed income tax hike would dramatically affect working middle-class families, financially at-risk Pennsylvanians, and small businesses. Although he suggested that there would be a “tax forgiveness” program as part of the proposal, families at the median family income (fewer than five children) would still pay more. Even with tax forgiveness, residents will still have to pay $232 each, or $927 per family of four, on average.  

This tax hike proposal would be also be detrimental to local, small businesses that already pay the state’s Personal Income Tax. From maintaining an extended, onerous shutdown, to vetoing limited liability protection legislation so businesses could operate without fear of incessant lawsuits, Gov. Wolf has proved himself to be a governor who does not look out for small businesses. Instead, he wants them to pay more taxes as they attempt to recover from the pandemic.  

Also included in the budget proposal is a severance tax on the natural gas industry in Pennsylvania, the nation’s second-largest natural gas producer. This would be a double-tax, as Pennsylvania already imposes and impact fee on natural gas extraction. 

Gov. Wolf thinks imposing a severance tax would help Pennsylvanians “come out of this pandemic pretty much faster than anything else,” but this is untrue. According to last year’s Pennsylvania Energy Employment Report, natural gas employment in the state declined by 7.4%. A natural gas severance tax would kill more energy jobs and hinder the state from recovering.  

Gov. Wolf has advocated for a severance tax in each of his budgets for the last six years and has failed each time; it also remains widely unpopular among the Republican-controlled House and Senate.  

Even with these proposed tax hikes, Gov. Wolf is still likely to find ways to overspend and put Pennsylvania deeper into debt. Since he took office in 2015, spending in Pennsylvania has dramatically accelerated and increased by more than $24.5 billion (more than $1,900 per person) and two of the last six budget cycles have yielded tax increases. Despite these tax increases, Gov. Wolf has continued to overspend the approved budget ($400 million in 2016–2017, $673 million in 2018–2019, and more than $1 billion in 2019–2020).  

Gov. Wolf signed a late budget without any tax hikes in the final weeks of 2020, but it still contained a 4% spending increase from the year prior and failed to restrict supplemental appropriations. Although Gov. Wolf pushes for tax increases, citing the need for them to provide sufficient revenue for the state, he continues to ask the legislature for supplemental funding. Lawmakers and taxpayers should expect another hefty supplemental request – as it appears that no amount of money will be enough.   

According to a report by Pennsylvania’s Independent Fiscal Office, it is projected that it will take about six years for employment to recover from the pandemic-induced recession and strict lockdowns imposed by the Wolf Administration. That's far too long for families and small businesses in the Keystone State who need immediate economic recovery.  

Pennsylvania legislators should reject Governor Wolf’s massive tax hike proposals.  

Photo Credit: Governor Tom Wolf

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Indiana State Reps Break No-Tax Commitment for Second Time

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Posted by Sheridan Nolen on Tuesday, February 23rd, 2021, 5:22 PM PERMALINK

On Monday, the Indiana House of Representatives passed House Bill 1001, a $36 billion two-year state budget that includes tax hikes on cigarettes and vaping. Under HB 1001, the cigarette tax would increase from $1 to $1.50 and a 10% retail tax would be imposed on e-cigarettes and e-liquids.  

Among the 95 representatives who voted for the cigarette and vape tax hike included in HB 1001, 16 were Taxpayer Protection Pledge signees. Out of those 16, 12 have previously broken their pledge by voting in favor of a gas tax hike in 2017.  

The following Republican House lawmakers broke their promise to voters not once, but twice, by supporting tax hikes on Hoosiers:  

Representative Robert Behning (R-91) 

Representative Timothy Brown (R-41) 

Representative Martin Carbaugh (R-81) 

Representative Bob Cherry (R-53) 

Representative Steven Davisson (R-73) 

Representative Jeff Ellington (R-62) 

Representative Bob Heaton (R-46) 

Representative Todd Huston (R-37) 

Representative Don Lehe (R-25) 

Representative Jim Lucas (R-69) 

Representative Jerry Torr (R-39) 

Representative Cindy Ziemke (R-55) 

You can see the list of those who broke their pledge by voting for a gas tax increase in 2017 here

 

Photo Credit: Judy van der Velden

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Maryland: First State in the Nation to Impose Job Killing Digital Ad Tax

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Posted by Sheridan Nolen on Wednesday, February 17th, 2021, 2:26 PM PERMALINK

In a devastating blow to Maryland businesses and consumers, the democrat-led state legislature voted to override Gov. Larry Hogan’s veto of HB 732 last week. Maryland now has the unwelcome distinction of being home to the nation’s first ever digital advertising tax. 

Under the guise of squeezing revenue from Big Tech companies like Facebook, Google, and Amazon, HB 732 will impose between a 2.5% and 10% tax on revenues generated from digital advertising services in Maryland. Unfortunately, Maryland-based businesses and taxpayers are going to bear the burden of this new tax, which is anticipated to amount to a whopping $250 million a year.  

“This new tax will certainly be a headache for these tech companies, but the cost of the tax itself as well as the associated compliance costs will ultimately be passed onto Maryland businesses,” explained Grover Norquist, president of Americans for Tax Reform. “As a result, these businesses may have to lower wages, cut hours, or raise prices on consumers, which is the last thing Maryland needs after nearly a year of COVID-19.” 

"The digital ad tax is regressive and will be felt by those who can least afford it, especially right now. For small businesses fighting to survive during COVID-19, this vote sends a chilling message about the priorities of those in power,” said Doug Mayer, a spokesman for Marylanders for Tax Fairness, following the veto override.  

Another argument against HB 732 is that it will likely to result in Maryland taxpayers footing the bill for costly legal challenges that bill is unlikely to survive. In fact, in a legal review of HB 732 last year, Attorney General Brian Frosh stated that the bill was “not clearly constitutional” and highlighted potential problems the state would face if it had to defend the measure in court.  

First, the bill could be challenged as a violation of the Dormant Commerce Clause, which prohibits states from discriminating against different types of interstate commerce. The bill contains a provision to exclude Maryland-based businesses from the tax and it only includes certain types of advertising while excluding others. Second, the digital advertisement tax is likely a violation of the Internet Tax Freedom Act, which prohibits discriminatory taxes on e-commerce. And third, this bill could also be a violation of the First Amendment because it taxes speech.  

Unfortunately, the bad news with HB 732 does not end there. It would also place a $1.75 sales tax increase per pack of cigarettes and raise the sales tax on e-cigarettes and vaping liquids. Tax hikes on tobacco and vaping products will disproportionately impact some of Maryland’s most vulnerable taxpayers when they can least afford it. According to the National Adult Tobacco Surveys, 72% of smokers are from low-income communities. HB 732 increases taxes on people unable to quit as they are struggling with the costs of the COVID-19 pandemic and puts unnecessary hardship on struggling families. 

Democrats in the state legislature seemed to have forgotten sage advice from former President Obama. While in office, he remarked: "The last thing you want to do is raise taxes in the middle of a recession because that would just suck up, take more demand out of the economy and put businesses in a further hole." 

With the enactment of HB 732, state lawmakers have made it increasingly more difficult for small business owners and hardworking taxpayers to overcome the financial burden of the pandemic. Fortunately, there is still some hope for taxpayers in Maryland, as the legality of the digital advertising tax portion of the bill is likely to be challenged in court.  

Photo Credit: Bonnie Natko

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Will Kansas Governor Laura Kelly Block This Commonsense Pro-Taxpayer Bill Again?

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Posted by Sheridan Nolen on Tuesday, February 16th, 2021, 1:49 PM PERMALINK

Last week, the Kansas Senate approved a package of tax cuts and measures that would finally allow Kansans to benefit from the Federal Tax Cuts and Jobs Act (TCJA) of 2017 and eliminate state taxes on Social Security benefits and some pensions.  

Senate Bill 22, or the RELIEF Act, would allow Kansans to take itemized state deductions regardless of whether the standard deduction is claimed for federal income tax purposes. Victims of identity theft would not have to pay income taxes on fraudulent unemployment claims going to other people. In addition, it includes provisions to "decouple" state and federal income taxes. Social Security and retirement income would also be exempt from being taxed. 

The TCJA was signed into law three years ago by former-President Trump in December 2017 and many states have already changed their tax codes to conform to the federal changes. However, Kansas has not. In fact, nearly two years ago, the legislature brought forth a measure similar to SB 22 that would have allowed Kansas to conform with the federal tax code, but Gov. Kelly vetoed it. As a result, Kansans have been paying more in taxes than they should be.  

A majority of Republicans showed overwhelming approval for the bill, citing that it would provide taxpayers and business owners relief after they started paying more taxes in the federal tax code. Among those praising the legislation is Sen. Caryn Tyson, Chair of the Committee on Assessment and Taxation. “It allows Kansas taxpayers to get the money that they were meant to get in the first place,” said Sen. Tyson. She even suggested calling it a tax increase every time Gov. Kelly vetoes one of these bills.  

Almost every state has taken action to adjust their state tax codes following the recent changes to the federal tax code.  

Photo Credit: F McGady

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Will This Indiana Legislator Break Her Promise to Oppose Tax Hikes a Second Time?

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Posted by Sheridan Nolen on Thursday, February 4th, 2021, 3:41 PM PERMALINK

In 2017, Indiana State Representative Cindy Ziemke, broke the pledge she made to her voters to oppose any, and all tax increases when she voted in favor of a 34% tax increase in the state gas tax. 

Now, she is setting the stage for a second pledge-breaking vote, by sponsoring a bill that would hurt businesses and families and would increase the highly regressive tax on vaping and cigarettes.  

The bill, HB 1434, would nearly double the tax on cigarettes from $1 to $1.995 per pack of regular size cigarettes and make a corresponding increase for larger cigarettes. It also adds a tax on e-liquids, used for e-cigarettes, at a rate of $0.08 per milliliter – some of the highest in the country.  

HB 1434 is bound to have unintended consequences that would dramatically, and disproportionately, harm Indiana’s most vulnerable taxpayers when they can least afford it.  

The National Adult Tobacco Surveys has demonstrated that tobacco tax increases do not impact the prevalence of smoking among individuals with household incomes less than $25,000, meaning this bill will do absolutely nothing to affect smoking rates.  

Increasing the tax on cigarettes would also grow lucrative criminal cigarette smuggling in Indiana. In fact, Indiana’s high tobacco tax neighbors – Michigan and Illinois – have actually seen 20% of the market consisting of illicit tobacco.  

HB 1434 also hurts Hoosiers who are trying to quit smoking. E-cigarettes have been found to be 95% safer than combustible tobacco and are twice as effective as more traditional nicotine replacement therapies. When Minnesota imposed a tax on these products, the policy ended up disincentivizing 32,400 additional adult smokers from quitting. In a large-scale analysis by the by the nation’s leading cancer researchers, and coordinated by Georgetown University Medical Center, close to 150,000 lives would be saved if a majority of Indiana smokers made the switch to vaping.  

Rep. Ziemke should recommit to her promise to oppose tax increases on Hoosiers, and reconsider supporting tax hike legislation that would have so many negative consequences.  

Photo Credit: Sean Molin

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