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FROM THE TRENCHES
March 22, 2020
This week has been another busy week for VTA. As our federal and state governments respond aggressively to the COVID-19 pandemic, VTA remains fully engaged in supporting and advocating for the rights of our community. We ask that you do your part to ensure that we slow the further spread of the virus. We are all in this together.
PLEASE EXERCISE ALL COVID-19 PRECAUTIONS
As our federal and state governments are responding aggressively to the COVID-19 pandemic, every one of us must ACT NOW to exercise all precautions to ensure that we slow the further spread of the virus. Please encourage everyone you know – old and young – to ACT NOW by heeding the recommendations of our federal and state leaders. We are in a critical period where the actions of everyone can and will have an impact on the spread of the virus. The only question is whether our actions will mitigate or accelerate the spread of the virus. Do your part! Additional details on how to protect yourself and your families, and what to do if you are sick, can be found on the CDC’s coronavirus page.
CORONAVIRUS AID, RELIEF & ECONOMIC SECURITY ACT
Senators continued work Saturday and Sunday to finalize a bipartisan agreement Coronavirus Aid, Relief and Economic Security Act (“CARES” Act) and they are very close to a final agreement. As the talks finished up last night, there seemed to be a growing consensus on the small business section, health care section, direct to consumer assistance and the distressed industry section. Issues still remained on additional unemployment insurance and the tax section. This morning (Sunday) there will be a meeting in Leader McConnell’s office of the Big 4 leaders (Majority Leader McConnell, Minority Leader Schumer, Speaker Pelosi and Minority Leader McCarthy) with Secretary Steve Mnuchin. The Senate will go into session at 2:00 pm on Sunday and at 3:00 pm will have a cloture vote on the motion to proceed to the bill. After that, Leader McConnell is planning/pushing for the Senate to vote on the 3.0 relief package on Monday. When the text of the bill becomes available, our team will provide specific insights into what it means for you and your business.
STATE OF THE STATES
This week has been another busy week for VTA and its member associations in
statehouses. As state governments respond aggressively to the COVID-19 pandemic, most legislatures have cancelled or gone into recess, the few still in session are operating in a limited capacity. We have shifted a majority of our face-to-face interactions with legislators to virtual interactions and ask that you do the same.
FLORIDA FIGHTS FOR FLAVOR BAN VETO
Last week the Florida legislature passed SB 810, legislation that bans the sale of flavored vaping products other than tobacco and menthol. The bill is on its way to the governor’s desk for him to either sign it into law or veto it.
VTA, the Florida Smoke Free Association and our team in Tallahassee are working to convince Governor DeSantis to VETO this harmful legislation. To help make our case to the Governor, we released an economic impact report on a Florida Flavor Ban, According to the report from John Dunham & Associates, the flavor ban in SB 810 would blow a $605.6 million hole in the Sunshine State’s economy at just the worst time. What else is at stake for Floridians?
– 4,500 jobs – GONE
– $186.6 million in wages lost
– $48.4 million in state tax revenue lost
If signed into law, the proposed ban would decimate the small businesses that provide vapor products to adults desperately trying to quit smoking. Read the full Dunham & Associates report here.
Americans for Tax Reform submitted a letter to the Governor’s office urging him to veto SB 810. The letter from Grover Norquist, President of Americans for Tax Reform, laid out the many reasons why this legislation is harmful and not the right policy for Florida.
We are continuing our efforts to reach the Governor and advocate on behalf of our members who would be severely impacted by this legislation, but we NEED YOU and your customers to ask Governor DeSantis NOW to VETO Senate Bill 810.
Please Contact Governor DeSantis at (850) 717-9337 or via Twitter @GovRonDeSantis and have your family, friends, and customers in Florida do the same.
MARYLAND DEFEATS FLAVOR BAN BUT TAX BILL PASSES
In Maryland, the HB 3 Flavor Ban came up again this week in Committee. However, after some discussion, it did not advance. VTA and Maryland Vapor Alliance were able to successfully stop this bill from advancing to the House floor! This is another big development in a state that initiated numerous anti-vaping bills this session.
We also fought against a host of tax proposals during the legislative session and the main bill, HB 732. With less than three hours to go during the Maryland General Assembly, the House concurred with the Senate amendments to HB 732 and then voted in favor of the bill by a vote of 88-47. Only 85 votes are needed to sustain a veto. As a result, with a few administrative actions remaining, this bill will go to the Governor’s desk. HB 732 does the following:
– Raises the current sales and use tax on “electronic smoking devices,”
which includes “vaping liquids,” from 6% to 12% at the final point of sale; and
– Raises the current sales and use tax on “vaping liquids” that are sold in
containers of 5 ML or less from 6% to 60% at the final point of sale.
It appears that the taxes will commence on July 1, 2020, but there is some ambiguity which we are attempting to sort out. Importantly, HB 732 includes preemption barring any new local taxes, except those in effect as of January 1, 2020. Though very unusual for Maryland, there is discussion of a Special Session possibly in May and the session is now in recess due to the coronavirus. We are actively engaged and will continue to push for meaningful legislation.
KENTUCKY BATTLE OVER TAXES CONTINUES
Of all states, Kentucky has posed serious problems regarding taxes this session. We are aggressively fighting excessive tax legislation in HB 32. The legislation would impose a floor tax rate of 25% on vapor products which, we know, will cause small businesses to close. Our team has been in negotiations with key senators regarding the likely unforeseen impact of such a tax. The legislation is currently pending in the Kentucky Senate Appropriations & Revenue Committee and we are working to generate support for an alternative approach.
IN THE NEWS
THE CDC’S SHIFT FROM VAPING TO COVID-19 HIGHLIGHTS THE CRUCIAL DIFFERENCES BETWEEN REAL AND METAPHORICAL EPIDEMICS
By conflating illnesses related to the use of black market THC products with vaping, the CDC impeded the harm-reducing shift from conventional cigarettes to nicotine delivery systems that are far less dangerous. Reason covered the confusion this created and the damage it had on the CDC’s credibility on the eve of the COVID-19 crisis. Click here to read the full piece.
During this time of uncertainty, we ask that you be safe, be smart and stick with us. As we have always said, we are all in this together. Connect with us and thank you for all you do to protect vapor!
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