“Vapor” Regulation Approved
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Published: 29-Apr-2014

OKLAHOMA CITY -- A bill that bans the sale of vapor products to minors was signed by Gov. Mary Fallin on Monday.

Senate Bill 1602 goes into effect Nov.1. 2014.

The penalty for selling vapor products to anyone younger than 18 will be the same as selling cigarettes to minors: a fine of $25 to $200 and confinement in the county jail for a period of 10 to three months.

In addition, any minor found in possession of vapor products will be guilty of a misdemeanor, the penalty for which will be a $5 fine and/or a five-day jail sentence.

A merchant licensed to sell vapor products that provides it to anyone younger than 18 without first requiring proof of age will be subject to an administrative fine of up to 100 for an initial offense, $200 for a second offense within two years, and $300 for a third offense, plus suspension of the store’s sales-tax permit for 30 days.

Also, distribution of vapor products is not permissible within 300 feet of any school, playground or other facility used primarily by minors. A violator can be fined $100 for a first offense, up to $300 for a third or subsequent offense.

S.B. 1602 defines a “vapor product” to mean non-combustible products that might or might not contain nicotine, that employ a mechanical heating element, battery, electronic circuit or other mechanism, that can be used to produce a vapor in a solution or other form.

S.B. 1602 stops short of defining vapes as tobacco. To do so would invite much more stringent government regulation. It also would subject vapor products to higher taxation. 

Vapor products currently are subject only to the 4.5% state sales tax, while excise taxes are imposed on tobacco products at the rate of $1.03 per pack of cigarettes.

The new statute also contains pre-emptive language that forbids cities, towns and counties from enacting any ordinances or laws against vapor products that are stricter than state law.

S.B. 1602 stipulates that vapor products include any vapor cartridge or other container with or without nicotine or other form that is “intended to be used with an electronic cigarette, electronic cigar, electronic cigarillo, electronic pipe, or similar product or device,” and any cartridge or other container of a solution which may or may not contain nicotine and which is “intended to be used with or in” an electronic cigarette, cigar, cigarillo or other electronic device.

Liquid nicotine is toxic and can be absorbed through the skin.

The Oklahoma Poison Control Center had received 38 reports of nicotine poisoning this year, as of Monday morning, center director Scott Schaeffer said. That means the Poison Control Center has received almost half as many nicotine poisoning calls in just four months this year as it logged in all of last year (77), and more than three times as many calls as it fielded two years ago (12 calls in 2012). The vast majority of the victims are children sampling the flavored, nicotine-laced liquid that’s in e-cigarette cartridges or in the bottles that are used to refill electronic cigarettes, records reflect.

Nicotine can be lethal, but none of the poisoning victims this year has died, Schaeffer said. E-cigarette liquids pose a greater immediate risk of poisoning than the smoking of cigarettes or pipes, because the nicotine-laced liquid is absorbed quickly.

A report issued earlier this month by the Centers for Disease Control and Prevention showed that the number of calls to poison centers involving e-cigarette liquids containing nicotine skyrocketed from one per month in September 2010 to 215 per month in February 2014.

The State Health Department reports that smoking in Oklahoma is declining: from a per capita average of 108 cigarettes in 2000 to 67 cigarettes per person in 2013. Anti-smoking advocates credit high tax rates, social stigma and peer pressure, plus the advent of e-cigarettes and the spread of vaporiums across the state over the past 18 months: to an estimated 300 shops today.

However, Oklahoma Tax Commission ledgers show that cigarette and tobacco taxes produced:
            
Ù $282.8 million for the state treasury in Fiscal Year 2012-13;
Ù $293.5 million in FY 2011-12;
Ù $279.89 million in FY 2010-11;
Ù $267.99 million in FY 2009-10;
Ù $224.6 million in FY 2005-06, the first full fiscal year after the Legislature raised tobacco tax rates.

Throughout those eight years the cigarette tax has been $1.03 per pack of 20; the tobacco products tax has been 72 cents per pack of 20 little cigars and 12 cents per large cigar; smoking tobacco, 80% of the factory list price; and chewing tobacco, 60% of the factory list price.

Also during that same period, revenues the State of Oklahoma has collected from Native American tribes in in-lieu-of payments on untaxed sales of cigarettes and tobacco products in tribal smokeshops have more than doubled: from $26 million in FY 2005-06 to $54.67 million in FY 2012-13.

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