AN ACT TO AMEND TITLE 30 OF THE DELAWARE CODE RELATING TO TOBACCO PRODUCT TAXATION AND LICENSING.

Plain English Breakdown

Checked against official source text during the last sync.

Delaware Tobacco Product Tax and Licensing Act

This act changes how Delaware taxes different tobacco products, including cigarettes, cigars, vapor products, and nicotine pouches, and also updates licensing fees for businesses that sell these items.

What This Bill Does

• Sets a new tax rate of $3.60 per pack on cigarettes.
• Increases the tax rate for other tobacco products to 40% of their wholesale price.
• Keeps the tax rate at 30% of the wholesale price for premium cigars.
• Adds a tax of 10 cents per fluid milliliter for vapor products.
• Includes nicotine pouches in the definition of tobacco products.

Who It Names or Affects

• People who buy and sell tobacco products in Delaware.
• Businesses that need licenses to sell these items.

Terms To Know

Premium cigar

A high-quality cigar with a higher price than regular cigars.

Nicotine pouch

A small bag that contains nicotine and is placed under the lip to deliver nicotine without smoke.

Limits and Unknowns

• The bill does not specify how much money will be raised from these new taxes.
• It requires a three-fifths majority vote in both houses of the Delaware General Assembly for passage.

Official Summary Text

AN ACT TO AMEND TITLE 30 OF THE DELAWARE CODE RELATING TO TOBACCO PRODUCT TAXATION AND LICENSING.
House Substitute No. 1 for House Bill No. 215 differs from House Bill No. 215 as follows: this substitute provides a definition of a premium cigar and modifies the tax rate changes in House Bill 215 by setting the tax rate for other tobacco products at 40% of the wholesale price, maintaining the tax for premium cigars at 30% of the wholesale price, and setting the tax rate for vapor products at 10 cents per fluid milliliter. A definition of “nicotine pouch” is added. As with House Bill 215, House Substitute No.1 increases the cigarette tax rate to $3.60 per pack, increases some license fees, and changes the definition of “tobacco products” to include more items. This substitute bill sets the effective date of the tax rate increases as September 1, 2026, and the effective date of the increased license fees as January 1, 2027.

This Act requires a greater than majority vote for passage because § 10 of Article VIII of the Delaware Constitution requires the affirmative vote of three-fifths of the members elected to each house of the General Assembly to increase the effective rate of a tax or fee levied by the State.