Maine

Background

Electronic smoking devices and liquids used in electronic smoking devices whether or not they contain nicotine have been added to the category of tobacco products subject to excise tax following the adoption by Maine State Legislature and Governor Paul LePage of HP0758, Legislative Document 1028, known as An Act To Prevent and Reduce Tobacco Use with Adequate Funding and by Equalizing the Taxes on Tobacco Products and To Improve Public Health, on 2 July 2019.

Tax rates and structure

The law extends the tax on tobacco products other than cigarettes to electronic smoking devices and liquids. The tax is applied at a rate of 43% of the wholesale price. In the future, if the tax on cigarettes is increased the state tax assessor shall calculate a rate of tax on other tobacco products that is equivalent to the same percentage change in the tax rate for one cigarette. The adjusted rates calculated by the assessor take effect at the same time as the increase in the tax on cigarettes.

The original bill sought to increase the rate of tax on other tobacco products from 20% to 81 percent. However, when an amended version added electronic smoking devices to the list of OTPs, the proposed tax rate was reduced to 43 percent.

The tax on electronic smoking devices and liquids used in them goes into effect on 2 January 2020.