Don’t Tax Nicotine Pouches: They Helped Me Stop Smoking

By Dan Murphy

“Heavily taxing safer alternatives to cigarettes keeps smokers from switching to better substitutes.” These words of wisdom come from Guy Bentley from the Reason Foundation, who wrote about how New York Governor Kathy Hochul’s proposed 75% tax on nicotine pouches is bad for public health.

Bentley writes, “Commenting on the planned tax increase, New York State Budget Director Blake Washington said the Hochul administration views nicotine pouches and cigarettes as a ‘distinction without a difference.” But nothing could be further from the truth.

“Nicotine pouches contain no tobacco and produce no smoke. Users place a small pouch between their lip and gum, getting the nicotine they want without the tar and carcinogens that make cigarettes deadly. Nicotine is addictive, but it’s not what kills smokers; the combustion is. That’s partly why Sweden, where the oral tobacco product snus has been popular for decades, has the lowest smoking and lung cancer rates in Europe.

“Last year, the Food and Drug Administration authorized ZYN and on! PLUS nicotine pouches because they’ve proven to be safer than cigarettes, help smokers quit smoking, and aren’t appealing to kids,” writes Bentley (https://reason.org/commentary/new-york-gov-hochuls-nicotine-pouch-tax-would-be-bad-for-public-health).

Four Westchester residents wrote us letters opposing Hochul’s tax on pouches. They write, “Gov. Kathy Hochul’s proposed budget includes a 75% tax on nicotine pouches. As consumers of pouches, for several reasons, including our own finances, we hope the legislature rejects this proposal and that Gov. Hochul reverses course.

“Legislators may not know that under President Biden’s administration, the Food and Drug Administration (FDA), which vets the safety of a range of products including nicotine-delivery systems, determined that nicotine pouches are less harmful than conventional, combustible cigarettes.

“In other words, if we want to bring down public health costs and minimize human suffering from smoking-related illnesses, we want nicotine pouches to be cheaper than cigarettes so smokers will switch to the less-harmful product. But the draft budget would tax them exactly the same as deadly, combustible cigarettes, making cigarettes just as attractive for nicotine users.

“That category, of course, includes kids who will have more access, not less, to pouches if the 75% tax has the same effect high cigarette taxes have, where the product is smuggled into New York from nearby lower tax states along the I-95 corridor.

Retailers who charge sales taxes on nicotine products rigorously check IDs before selling them. Bootleggers hawking their wares out of the back of a van or over the Internet do not. Several recent studies from experts at NYU, Yale, and Rutgers show that when you make it harder to buy non-cigarette nicotine products, people—including underage kids—switch to smoking. No one wants that result.

“A 75% tax will also hurt small retailers, many of them owned by Black and Brown New Yorkers. Whatever one’s politics, we should all be able to agree that it is not progressive, which may help explain why polling shows that, even among voters in last year’s New York City mayoral race, the most liberal voters in the state, the 75% tax proposal does not even attain majority support. The idea doesn’t sell in Long Island City. It won’t sell in Lowerre, Lincoln, or Lackawanna, either.

The governor and the legislature need to drop this plan like it’s hot, before the state’s budget deadline rolls around.”

In an interview on the Lars Larson show, Dr. Ray Niaura said.

LL: Dr. Niaura, it floors me that in the United States, they applied the same kind of vehemence to their anti-cigarette campaign that they’ve also applied to vaping with nicotine to all these other delivery mechanisms like pouches, like vaping, and that sort of thing. And in Great Britain, they’ve gone the other direction. They said, ” We want to get people to stop smoking cigarettes, and that will eliminate 95% of the harm. Now I’m throwing out a number; you might disagree with it, and if so, please say so. But if we could get people to say everybody in America would stop smoking and start either vaping or using pouches or some other delivery mechanism, could we eliminate a gigantic percentage of the harm?

RN: Yeah, I think we could, and one place to look for an example of this sort of thing happening is the country of Sweden, which now has the lowest cigarette smoking rate of all the countries in the European Union, and also has the lowest smoking-related disease rates; lung cancer is the lowest. And the reason that that is so is that the country moved over from smoking cigarettes to using Swedish snus, which is a kind of pouch-like product that delivers nicotine but without most of the toxins. And so we have, this is probably over the past 30 years or so, we’ve seen the epidemiology, we’ve seen their smoking-related disease and death rates go down. There’s no reason to imagine that the same thing couldn’t happen here. Except for the factors working against it.

LL: And so this vehemence that they applied to cigarettes and said first we’re going to ban them, ban people from smoking in elevators, and then it’s going to be public buildings, and then it’s going to be private businesses, and they haven’t yet gone to people’s homes, at least nationwide. But when you hear that a state is saying we’re going to put a gigantic tax increase, say 95% tax on tobacco pouches, is that in line with public health, or is that just about the government grabbing a bunch of money?

RN: Yeah, well, we’ll leave a side to the issue of grabbing money for the moment, but yeah, I think it’s misguided, and it’s a missed opportunity, really. These products, and, by the way, the pouches, have recently been authorized by the FDA for protection of public health, meaning they are much safer than cigarettes. And you know if we’re interested as a society in you know saving people from the you know death and disability associated with smoking cigarettes we ought to be encouraging them to move the safer products like the nicotine pouches and one way to do that would be to tax them at a lesser rate compared to cigarettes and so you know from the point of view of harm reduction again to me it’s a missed opportunity.” (https://soundcloud.com/thelarslarsonshow/dr-ray-niaura-should-washington-add-a-95-tax-increase-on-tobacco-pouches-and-other-products-that-help-people-stop-smoking-1).

After researching this topic, we learned another fact: New York is the 2nd-highest state for cigarette smuggling to avoid the large NYS Tax of $4.35 per pack. -$43.50 per carton.

A study by the Tax Foundation found that 51.8% of the cigarettes sold in New York State are smuggled in, and the state does not collect a tax on them. The Tax Foundation also determined that a total of 186 MILLION packs of cigarettes are smuggled in untaxed, resulting in a loss of $812 MILLION in revenue. (https://taxfoundation.org/data/all/state/cigarette-taxes-cigarette-smuggling-state/).

A request to our Governor and State Senate Majority Leader Stewart-Cousins. Don’t tax nicotine pouches. It is helping many New Yorkers like me to quit smoking.