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.