Bill seeking cigarette tax increases deferred this session

A House Bill that sought to increase taxes on cigarettes and vape products to bolster funds for cancer research will not make it to the governor’s desk this year.

House Bill 2504 — part of Gov. Josh Green’s package — was deferred during a conference committee hearing in which the House and Senate could not come to an agreement.

In its original version, the bill would have increased the tax on cigarettes and little cigars to 18 cents per item, up from 16 cents per item from the wholesaler or dealer. It also doubled the allocation to the cancer research fund to 4 cents per cigarette.

In its latest version, little cigars were removed, and electronic smoking devices and e-liquids were added, with the rate reverted to 16 cents per item, which is what rates have been since 2011.

Additionally, the allocation to the University of Hawaii Cancer Research Center was whittled back to its original rate of 2 cents per cigarette.

The move to increase taxes on all tobacco products was supported by the state Health Department, American Cancer Society and Hawaii Pacific Health, among numerous other health advocates who agreed raising the price of tobacco products is an effective way to reduce harmful consumption.

It was opposed by ABC Stores, Retail Merchants of Hawaii and the Hawaii Smokers Alliance, which said raising taxes would harm small businesses, make these products more attractive to shoplifters and create a black market.