Numerous cities and towns nationwide have prohibited the sale of flavored tobacco products, which are highly popular among teenagers. These products encompass menthol cigarettes, which were the most frequently used tobacco product among adolescents in 2021, as per a recent CDC survey. In 2022, the citizens of California overwhelmingly passed Senate Bill 793, which banned flavored cigarettes and vape tanks. The Supreme Court has recently declined a tobacco company’s appeal to halt the ban from being implemented on Dec. 21.

Loss of Tax Revenues

In the month following the implementation of the ban on flavored tobacco in California, tax-paid cigarette sales dropped 17.3 percent. That’s about 5.6 million fewer packs sold, costing the state an estimated $300 million in lost excise taxes annually. Despite Big Tobacco spending millions on a referendum campaign to overturn the 2020 law, voters upheld it in November. That doesn’t mean the fight is over, though. The new statewide ban makes it illegal for retailers to sell flavored cigarettes, including menthol. It also forbids the sale of flavored vape pens, cigars, and certain types of gums that contain nicotine. It doesn’t affect the sale of unflavored tobacco or candy, but it does impact a store’s ability to offer a wide variety of flavors to adult smokers and vapers. Many cities and counties in California already had their own flavored tobacco bans before the new statewide law took effect last year. They will continue to enforce their ordinances, which are more restrictive than the statewide ban. Retailers that violate the new state law face a $250 fine. Consumers can report violations to their local police departments, who often contact the retailer for proof of compliance. The city or county may then refer the violation to the state attorney general’s office, which will decide whether to prosecute.

Illicit Trafficking

The California ban — approved by voters — makes it illegal for stores and vending machines to sell flavored cigarettes, vape liquids, hookah tobacco, some types of cigars, and gummy candies that contain nicotine. It will go into effect Dec. 21. But a retired assistant director with the ATF who has conducted enforcement operations related to illicit trafficking says that despite the strict law, the cigarette black market is still alive and well in the Golden State due to a loophole. For example, California law exempts a type of pipe tobacco that can be used to roll a cigarette called “loose leaf” – sold in pouches that resemble flavored vaping products. The state also allows a handful of retailers to sell flavored tobacco products for use only at smoking bars that limit food and drink consumption, limit the number of people allowed in the bar, and meet other requirements. The state’s smuggling rate is one of the highest in the country. The smuggling problem will likely be compounded by a new federal bill allowing states to ban the importation and sale of most flavored tobacco products. The move is backed by major anti-tobacco groups, including the American Cancer Society Cancer Action Network, the American Lung Association, and the Campaign for Tobacco-Free Kids. 

Youth Smoking Rates

In the United States, cigarette smoking causes a significant burden of disease and death. Many states and localities have passed laws aimed at reducing youth smoking rates by prohibiting the sale of tobacco products that are most appealing to young people. However, there is a growing concern that these policies may cause unintended and harmful consequences that outweigh the health benefits. A recent study by University of California researchers examined the impact of flavored tobacco bans on smoking rates in communities across the state. They found that residents of jurisdictions with comprehensive flavored tobacco sales bans were 30% less likely to smoke than those living in areas without a ban. The study used three independent evaluation components:

  • A tracking system that monitored the reach of local ordinances.
  • A retail observation survey in matched communities.
  • An opinion poll of tobacco retailers.

The tracking system was augmented with regression models controlling for demographic covariates (age, sex, and race/ethnicity), the conventional cigarette tax rate, and year-and-district fixed effects. The retail observations and opinion polls were also augmented with various control variables, including store type and other local restrictions on tobacco sales. Even with strict local laws like those in Sunnyvale, teens can find flavored tobacco products. Sacramento’s code enforcement team inspects the city’s 400 tobacco retailers twice a year. Businesses that fail to comply with the law face a 30-day suspension, 90-day suspension, or revocation.

Adverse Impact on Public Health

For years, the public health argument for flavored tobacco bans has focused on the impact on children and teens who smoke or vape. It has been argued that by limiting access to these products, youth will be less likely to start smoking and will save lives, medical costs, and taxpayer money. As noted above, however, this approach is flawed for several reasons. For example, a ban that restricts access to flavored cigarettes will have the effect of depriving adults of choice, including older smokers and current smokers who wish to switch to vaping or other forms of non-cigarette tobacco use. In addition, the loss of state sales tax revenues will negatively impact social programs such as First 5, which supports pregnant women and young children. This program must raise its taxes or cut spending to compensate for these funds’ loss. The ad also notes that the flavored tobacco ban does not affect the sale of hookah tobacco, vapor cartridges, and flavored cigars, such as premium cigars. These are products that older individuals with higher incomes generally use, and a ban on their sale will have little or no effect on youth tobacco and nicotine use rates. 

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