Tobacco products tax/vapor

AN ACT Relating to exempting vapor products from the tobacco 1
products tax; amending RCW 82.26.010; and creating a new section.2
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:3
Sec. 1. RCW 82.26.010 and 2025 c 422 s 301 are each amended to 4
read as follows: 5
The definitions in this section apply throughout this chapter 6
unless the context clearly requires otherwise. 7
(1) "Actual price" means the total amount of consideration for 8
which tobacco products are sold, valued in money, whether received in 9
money or otherwise, including any charges by the seller necessary to 10
complete the sale such as charges for delivery, freight, 11
transportation, or handling. 12
(2) "Affiliated" means related in any way by virtue of any form 13
or amount of common ownership, control, operation, or management.14
(3) "Board" means the liquor and cannabis board.15
(4) "Business" means any trade, occupation, activity, or 16
enterprise engaged in for the purpose of selling or distributing 17
tobacco products in this state. 18
(5) "Cigar" means a roll for smoking that is of any size or shape 19
and that is made wholly or in part of tobacco, irrespective of 20
whether the tobacco is pure or flavored, adulterated or mixed with 21
H-2888.1
HOUSE BILL 2609
State of Washington 69th Legislature 2026 Regular Session
By Representatives Couture, Griffey, Barkis, and Simmons
Read first time 01/21/26. Referred to Committee on Finance.
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any other ingredient, if the roll has a wrapper made wholly or in 1
greater part of tobacco. "Cigar" does not include a cigarette.2
(6) "Cigarette" has the same meaning as in RCW 82.24.010.3
(7) "Department" means the department of revenue.4
(8) "Distributor" means (a) any person engaged in the business of 5
selling tobacco products in this state who brings, or causes to be 6
brought, into this state from without the state any tobacco products 7
for sale, (b) any person who makes, manufactures, fabricates, or 8
stores tobacco products in this state for sale in this state, (c) any 9
person engaged in the business of selling tobacco products without 10
this state who ships or transports tobacco products to retailers in 11
this state, to be sold by those retailers, (d) any person engaged in 12
the business of selling tobacco products in this state who handles 13
for sale any tobacco products that are within this state but upon 14
which tax has not been imposed. 15
(9) "Indian country" means the same as defined in chapter 82.24 16
RCW. 17
(10) "Little cigar" means a cigar that has a cellulose acetate 18
integrated filter. 19
(11) "Manufacturer" means a person who manufactures and sells 20
tobacco products. 21
(12) "Manufacturer's representative" means a person hired by a 22
manufacturer to sell or distribute the manufacturer's tobacco 23
products, and includes employees and independent contractors.24
(13) "Moist snuff" means tobacco that is finely cut, ground, or 25
powdered; is not for smoking; and is intended to be placed in the 26
oral, but not the nasal, cavity. 27
(14) "Person" means any individual, receiver, administrator, 28
executor, assignee, trustee in bankruptcy, trust, estate, firm, 29
copartnership, joint venture, club, company, joint stock company, 30
business trust, municipal corporation, the state and its departments 31
and institutions, political subdivision of the state of Washington, 32
corporation, limited liability company, association, society, any 33
group of individuals acting as a unit, whether mutual, cooperative, 34
fraternal, nonprofit, or otherwise. The term excludes any person 35
immune from state taxation, including the United States or its 36
instrumentalities, and federally recognized Indian tribes and 37
enrolled tribal members, conducting business within Indian country.38
(15) "Place of business" means any place where tobacco products 39
are sold or where tobacco products are manufactured, stored, or kept 40
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for the purpose of sale, including any vessel, vehicle, airplane, 1
train, or vending machine. 2
(16) "Retail outlet" means each place of business from which 3
tobacco products are sold to consumers. 4
(17) "Retailer" means any person engaged in the business of 5
selling tobacco products to ultimate consumers. 6
(18)(a) "Sale" means any transfer, exchange, or barter, in any 7
manner or by any means whatsoever, for a consideration, and includes 8
and means all sales made by any person. 9
(b) The term "sale" includes a gift by a person engaged in the 10
business of selling tobacco products, for advertising, promoting, or 11
as a means of evading the provisions of this chapter.12
(19)(a) "Taxable sales price" means: 13
(i) In the case of a taxpayer that is not affiliated with the 14
manufacturer, distributor, or other person from whom the taxpayer 15
purchased tobacco products, the actual price for which the taxpayer 16
purchased the tobacco products; 17
(ii) In the case of a taxpayer that purchases tobacco products 18
from an affiliated manufacturer, affiliated distributor, or other 19
affiliated person, and that sells those tobacco products to 20
unaffiliated distributors, unaffiliated retailers, or ultimate 21
consumers, the actual price for which that taxpayer sells those 22
tobacco products to unaffiliated distributors, unaffiliated 23
retailers, or ultimate consumers; 24
(iii) In the case of a taxpayer that sells tobacco products only 25
to affiliated distributors or affiliated retailers, the price, 26
determined as nearly as possible according to the actual price, that 27
other distributors sell similar tobacco products of like quality and 28
character to unaffiliated distributors, unaffiliated retailers, or 29
ultimate consumers; 30
(iv) In the case of a taxpayer that is a manufacturer selling 31
tobacco products directly to ultimate consumers, the actual price for 32
which the taxpayer sells those tobacco products to ultimate 33
consumers; 34
(v) In the case of a taxpayer that has acquired tobacco products 35
under a sale as defined in subsection (18)(b) of this section, the 36
price, determined as nearly as possible according to the actual 37
price, that the taxpayer or other distributors sell the same tobacco 38
products or similar tobacco products of like quality and character to 39
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unaffiliated distributors, unaffiliated retailers, or ultimate 1
consumers; or 2
(vi) In any case where (a)(i) through (v) of this subsection do 3
not apply, the price, determined as nearly as possible according to 4
the actual price, that the taxpayer or other distributors sell the 5
same tobacco products or similar tobacco products of like quality and 6
character to unaffiliated distributors, unaffiliated retailers, or 7
ultimate consumers. 8
(b) For purposes of (a)(i) and (ii) of this subsection only, 9
"person" includes both persons as defined in subsection (14) of this 10
section and any person immune from state taxation, including the 11
United States or its instrumentalities, and federally recognized 12
Indian tribes and enrolled tribal members, conducting business within 13
Indian country. 14
(c) The department may adopt rules regarding the determination of 15
taxable sales price under this subsection. 16
(20) "Taxpayer" means a person liable for the tax imposed by this 17
chapter. 18
(21) "Tobacco products" means cigars, cheroots, stogies, 19
periques, granulated, plug cut, crimp cut, ready rubbed, and other 20
smoking tobacco, snuff, snuff flour, cavendish, plug and twist 21
tobacco, fine-cut and other chewing tobaccos, shorts, refuse scraps, 22
clippings, cuttings and sweepings of tobacco, and other kinds and 23
forms of tobacco, prepared in such manner as to be suitable for 24
chewing or smoking in a pipe or otherwise, or both for chewing and 25
smoking, and any other product, regardless of form, that contains 26
tobacco or nicotine, whether derived from tobacco or created 27
synthetically, and is intended for human consumption or placement in 28
the oral or nasal cavity or absorption into the human body by any 29
other means, but does not include cigarettes as defined in RCW 30
82.24.010, vapor products as defined in RCW 70.345.010, or a drug, 31
device, or combination product approved, as of December 31, 2024, for 32
sale by the United States food and drug administration, as those 33
terms are defined in the federal food, drug, and cosmetic act (21 34
U.S.C. Sec. 301 et seq.) as it exists on January 1, 2026.35
(22) "Unaffiliated distributor" means a distributor that is not 36
affiliated with the manufacturer, distributor, or other person from 37
whom the distributor has purchased tobacco products.38
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(23) "Unaffiliated retailer" means a retailer that is not 1
affiliated with the manufacturer, distributor, or other person from 2
whom the retailer has purchased tobacco products. 3
NEW SECTION. Sec. 2. RCW 82.32.805 and 82.32.808 do not apply 4
to this act.5
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