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Missouri Tobacco Taxes Up in Smoke


 E-cigarettes subject to sales tax but not other tobacco taxes in Missouri.

Controversy surrounds e-cigarettes in Missouri.

Last summer, Governor Jay Nixon of Missouri vetoed legislation that bans the sale of e-cigarettes to minors but also does not include e-cigarettes and other alternative nicotine products and vapor products in the definition of “alternative nicotine product.” Last week, the Missouri Legislature voted to override the governor’s veto.

Under SB 841, alternative nicotine products and vapor products may only be sold to persons aged eighteen or older and are subject to state and local sales tax, “but shall not be otherwise taxed or regulated as tobacco products.” [Emphasis mine.] Retailers of tobacco products, alternative nicotine products and vapor products must have a retail sales tax license.

The governor opposes SB 841 for several reasons, including concerns that it will negatively impact the health of Missourians and undermine proposed federal regulations. His veto message to the legislature placed particular emphasis on the fact that SB 841 “would exclude ‘alternative nicotine products’ and ‘vapor products’ – including ‘electronic cigarettes’ – from the definition of ‘tobacco products’ and prohibit them from being regulated or taxed as ‘tobacco products’ under Missouri law.”

Governor Nixon has underscored the fact that SB 841 has the support of producers of electronic cigarettes but is opposed by numerous health and medical associations, such as the American Cancer Society and the Missouri State Medical Association. In spite of his disapproval, SB 841 takes effect retroactively on August 28, 2014.

Missouri is not the only state to struggle with how to define and tax electronic cigarettes and other alternative tobacco products. Washington DC is altering how it taxes other tobacco products, effective October 1, 2014.

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photo credit: Ozont via photopin cc


Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.