Senate Bill S305

                                
 
BILL NUMBER: S305

SPONSOR: HOYLMAN
 
TITLE OF BILL:  An act to amend the tax law, in relation to the regis-
tration of vendors of electronic cigarettes

 
PURPOSE:

To ensure all sellers of electronic cigarettes are registered and
subject to compliance checks

 
SUMMARY OF PROVISIONS:

Section one adds a new Article 20-C to the Tax Law, requiring any person
selling or offering for sale electronic cigarettes or liquid nicotine,
who that is not registered with the Department of Taxation and Finance
to sell tobacco products, to register under this section.  The Commis-
sioner shall adopt regulations to establish the registration requirement
and ensure compliance.

Section two provides the effective date.
              

 
JUSTIFICATION:

In 2012, the state banned the sale of electronic cigarettes to minors
under the age of 18. Despite enactment of this ban to minors in New York
and a number of other states, the CDC reports the use of electronic
cigarettes among middle school and high school students has more than
doubled from 2011 to 2012. Recognizing that the health effects of elec-
tronic cigarettes remain unknown, the FDA issued regulations on elec-
tronic cigarettes, which includes a nationwide ban of the sale to minors
in 2016. Given their use among minors, the FDA recently announced the
Youth Tobacco Prevention Plan to investigate and crack down on access to
minors. Since they are unregulated, electronic cigarette packages are
not required to include health warnings and they can contain flavored
electronic nicotine, which can often entice minors.

Although banned to minors in this state for several years, enforcement
of this provision has been problematic. Chapter 448 of 2012 included
electronic cigarettes in the Public Health Law provisions banning sale
to minors. Chapter 542 of 2014 expressly included liquid nicotine in the
ban to minors. Since these changes did not add electronic cigarettes or
liquid nicotine to the definition of a "tobacco product" under the Tax
Law, retailer's that sell only these products and not traditional tobac-
co products do not need a tobacco registration from the Department of
Taxation and Finance. As a result, when electronic cigarettes are sold
in stores that do not sell traditional tobacco products, these retailers
are not registered and there is no way for the Department of Health's
Enforcement Unit to know they are selling electronic cigarettes and to
conduct compliance checks to ensure they are not selling to minors. By
requiring retailers that are not registered under Article 20, to regis-
ter under this new article the bill ensures that State and localities
can conduct compliance checks to confirm adherence to existing law.

This bill also seeks to address the point raised by the Governor's Veto
message in 2016, claiming the bill would create a significant burden on
the Department of Health. Given the Department of Tax and Finance
already registers tobacco retailers, simply adding these retailers

pursuant to regulations established by the Department, should not be an
onerous new burden.

 
LEGISLATIVE HISTORY:

S.8285 of 2018 (Hannon): Died in IGO
2017: S.2542-A - Veto 186
2016: S.6003 - Veto 275
2015: S.6003 - Passed Senate, died in Assembly
2014: S.7139 - Passed Senate, died in Assembly

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
Effective the first day of the month commencing after the 180th day
after enactment; provided addition, amendment and/or repeal of any rule
or regulation necessary for implementation is effective immediately.