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California Prop 56 - Hidden Vape Tax

Discussion in 'Legislation News' started by Haktuspit, Jul 22, 2016.

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  1. Lessifer

    Lessifer Vaping Master Verified Member ECF Veteran

    Thanks for that. Would all of the same rules apply here though, as this isn't a "sales tax"?
     
  2. retired1

    retired1 Administrator Admin Verified Member ECF Veteran

    Supporting member
    Apr 5, 2013
    Texas
    I honestly don't know. With some of the stuff that states are coming up with to meet budget shortfalls, a lot of what's being passed just doesn't pass the smell test. One only needs to look at the idiocy in Arkansas and Indiana.
     
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  3. Rossum

    Rossum Surly Curmudgeon Verified Member ECF Veteran

    Supporting member
    Dec 14, 2013
    NE FL
    What's not at all clear in that summary is whether the bullet-points are tied together with an "or" or an "and". I'm going to assume it's an "and", because the last two items alone are not sufficient to meet the standard set in Quill Corp. v. North Dakota.

     
  4. retired1

    retired1 Administrator Admin Verified Member ECF Veteran

    Supporting member
    Apr 5, 2013
    Texas
    If you read further, it does imply that the three points must all be met in order for it to apply.
     
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  5. Lessifer

    Lessifer Vaping Master Verified Member ECF Veteran

    I'm fairly certain it's an "or" between 1 and 2, and there is an "and" between 2 and 3. This would be specifically for companies that do not meet the standard set in Quill Corp. v. North Dakota.
     
  6. Rossum

    Rossum Surly Curmudgeon Verified Member ECF Veteran

    Supporting member
    Dec 14, 2013
    NE FL
    It's definitely an "and" between all three. See section (c)(3) here:
    Regulation 1684
     
  7. Lessifer

    Lessifer Vaping Master Verified Member ECF Veteran

    Hmm... my legalese is off. Does amazon pay click referrals? or am I misunderstanding the first part?
     
  8. halbgott

    halbgott Senior Member ECF Veteran

    Apr 23, 2012
    Guessing that tax doesn't apply to the fixed price of nic patches.
     
  9. zoiDman

    zoiDman My -0^10 = Nothing at All* ECF Veteran

    Supporting member
    Apr 16, 2010
    So-Cal
    I don't think it applies to Any FDA approved NRT's.
     
  10. retired1

    retired1 Administrator Admin Verified Member ECF Veteran

    Supporting member
    Apr 5, 2013
    Texas
    If a person posts a referral link in a state, that can be counted as a point of presence by the tax offices, even if there's no physical brick and mortar store/warehouse.
     
    • Like Like x 1
  11. zoiDman

    zoiDman My -0^10 = Nothing at All* ECF Veteran

    Supporting member
    Apr 16, 2010
    So-Cal
    And... from the "More Good News" file, I just received an e-Mail from someone regarding the New 2017 - 18 Tax Rates on Tobacco Products in CA.


    "...
    The fiscal year 2017-18 Tobacco Products Tax Rate is based on the wholesale premium brand cigarette price as of March 1, 2017, as published by the Tobacco Merchants Association, and will be set at 65.08%. This rate is significantly higher than the fiscal year 2016-17 rate of 27.30% due to the passage of Proposition 56, The California Healthcare, Research and Prevention Tobacco Tax Act of 2016.

    ..."

    https://www.boe.ca.gov/meetings/pdf/2017/042517_P3_1_Tobacco_Tax_Rate.pdf

    https://www.boe.ca.gov/pdf/l502.pdf
     
  12. Rossum

    Rossum Surly Curmudgeon Verified Member ECF Veteran

    Supporting member
    Dec 14, 2013
    NE FL
    Congratulations, California! You've surpassed PA's 40% record for state-wide vape tax! :blink:
     
    • Like Like x 2
  13. r77r7r

    r77r7r ECF Guru ECF Veteran

    Feb 15, 2011
    Pa,LandOfTaxes
    I'm pretty naive on how these things work. If things change for the better on the federal level ( FDA Cole-Bishop ), how much does it then change what happens on a state level?
     
  14. zoiDman

    zoiDman My -0^10 = Nothing at All* ECF Veteran

    Supporting member
    Apr 16, 2010
    So-Cal
    Woo-Hoo! We're Number One!

    [​IMG]
     
  15. Rossum

    Rossum Surly Curmudgeon Verified Member ECF Veteran

    Supporting member
    Dec 14, 2013
    NE FL
    No, that will just mean that the states actually have something to tax.

    If the Deeming is implemented as currently written, vapor taxes pretty much become irrelevant in another year or two.
     
    • Like Like x 1
  16. zoiDman

    zoiDman My -0^10 = Nothing at All* ECF Veteran

    Supporting member
    Apr 16, 2010
    So-Cal
    Not a Lawyer.

    But I would say Not Much in The People's Republic of Kalifornia.
     
    • Like Like x 1
  17. oplholik

    oplholik ECF Guru Verified Member ECF Veteran

    Supporting member
    Well, we are always striving to be numero uno.
     
  18. Lessifer

    Lessifer Vaping Master Verified Member ECF Veteran

    Not quite the 80% I was expecting, but pretty darn close...
     
  19. stormjib

    stormjib Super Member ECF Veteran

    Sep 19, 2014
    California
    Have you guys seen this in action? None of my local shops seem to have raised their prices, at least the last time I was in them, a month or so ago...I'm sure I would have noticed if juice prices had gone up that much. I bought a new mod from a shop on my last visit and they matched the online price, but if I read it right, this tax is on ejuice only...I buy most of my juice online, have shops raised their prices by 35-40%? (65% of wholesale *should* be around 35% of retail, the way I figure it, maybe less because the margins are really huge on ejuice.)
     
  20. Lessifer

    Lessifer Vaping Master Verified Member ECF Veteran

    The new rate is supposed to be effective July 1st.
     
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