Which is exactly why, at 6 months, I've stepped it down to 6mg., working on getting to 0mg. nic soon. I love vaping and will keep it as a hobby but don't want to be nic dependent when all of this goes into effect. Going from 12mg. to 6 was pretty painless for me so I don't anticipate going 0 to be all that big of a transition.
Yes, they can tax the ingredients!
Here in Minnesota, anything containing tobacco derived nicotine is taxed at 95%
So if I buy a bottle of Mt Baker Vapor at $5 online, I must write a check to the state for $4.75. Of course, that's a finished product.
If I wanted to order a liter of 100mg nicotine online for $100, I'd owe the state $95 in tax. And I can't legally bring that much in to the state of MN without being a licensed tobacco distributor (and tightly regulated).
Since nicotine is the most expensive component of e-liquid, you can bet that makes a big impact in its retail price. It's already happened here. It will likely happen in other states soon.