In May, California Globe reported on a bill to ban flavored tobacco, but it was evident there would be amendments.
Senate Bill 793, written by Senator Jerry Hill (D-San Mateo), would make it illegal for any store that sells tobacco to sell flavored tobacco or tobacco flavor enhancer products. This would include more traditional tobacco products such cigars, cigarillos, and chewing tobacco, as well as newer products such as e-cigarettes, vape juice, and vaping systems. Products must show that a flavor has indeed been added and is different than simply tasting like tobacco.
Without amendments, SB 793 would ban a product that many say is largely harm free because it contains only pharmaceutical grade nicotine, and doesn’t come in tobacco flavors.
However, this product is not vapor, and it is not a Big Tobacco company lozenge… It’s tobacco-free snuff, made by the only company to ever receive a Modified Risk Tobacco Product approval from the FDA.
“Vaping, the most criticized smoking cessation option, will have a version of tobacco-free snuff to compete with starting this month,” USA Today reported. “At the same time, the makers of Camel cigarettes are bringing back dissolvable nicotine lozenges.”
“Swedish Match’s Zyn, a flavored nicotine powder packet designed to be stuck inside a person’s lip, will be in stores across the U.S. after successful distribution in 11 states. Think chewing tobacco without the tobacco. Until now, the company was known for its ‘snus,’ the Swedish name for snuff – or moist tobacco placed in the mouth.”
Since it doesn’t come in a tobacco flavor, if this bill passes, the product will be banned. Zyn also addresses FDA’s push for products that doesn’t attract kids, USA Today notes. “There’s no evidence – yet – that young people are attracted to snuff, and Zyn purchasers have to be 21 rather than 18, which is the age requirement for e-cigarette purchases in most states.”
“Banning flavored tobacco products is a bad public-health move given that many smokers have used smokeless tobacco products such as snus and other flavored nicotine pouches to break their dangerous habit,” said Steven Greenhut, Western director for the free-market R Street Institute. “It’s a bad fiscal-health move, also. California receives hundreds of millions of dollars in annual revenues from flavored tobacco products and needs that money to help plug a gaping budget hole.”
Greenhut points out in a 2019 op ed that “Large numbers of ex-smokers do in fact use these e-cigarettes and vape pens, which are 95 percent safer than combustible cigarettes, according to a well-respected British public health agency.”
“California lawmakers, at the state and local level, have been waging a war against vaping products for several years. San Francisco has outright banned the sale of e-cigarettes, even as it embraces marijuana retailers and promotes safe-injection sites for hard-core drug users. Other localities target vaping by forbidding flavored-tobacco sales. Because virtually all vape liquids are flavored, this becomes a de facto ban.”
With a ban of alternative tobacco products, the state stands to lose as much as $600 million in revenue. The 06/18/20- Senate Appropriations Committee analysis claimed the lost of revenue is “Unknown,” but “significant, and ongoing revenue loss, potentially in the high tens of millions to low hundreds of millions.”
The Department of Tax and Fee Administration (CDTFA) previously estimated excise tax revenue loss of $110 million in FY 2020-21 ($85 million from cigarettes, $2 million from tobacco products) and $218 million for FY 2021-22, the first entire fiscal year the ban would be in effect). In addition, associated sales tax losses of $26.6 million ($12 million General Fund) in FY 2020-21 and $53 million ($24.3 million General Fund) in FY 2021-22. CDTFA notes few data sources are available on consumer responses to banned flavored products, so consumer impacts are highly uncertain. The original revenue loss estimate would need to be revised to reflect a narrower scope of products affected by the ban.
This issue could have a massive impact on public health (banning ZYN would be extremely counter-productive) and for public finances, since sales of flavored tobacco products bring in a good chunk of tax revenue and public employees are already facing compensation cuts.
SB 793 was heard on the 18th in the Senate Appropriations Committee, where more amendments were adopted, and the committee passed it 5-1.
“I introduced Senate Bill 38 to protect young people from the dangerous health risks of tobacco products in any form and to prevent another generation from becoming addicted to nicotine,” said Senator Hill in a statement last year about his previous bill to ban smokeless tobacco products. ‘The aim was to prohibit tobacco products with fruit, candy and other flavors that entice young people from being sold in stores. The amendments imposed on the bill erode those protections by creating unnecessary, harmful exemptions.” Senator Hill withdrew SB 38 because of a lack of support.