Left-wing anti-tobacco advocacy groups are urging Nevada lawmakers to nearly double the state’s cigarette tax while increasing taxes on vaping products, nicotine pouches, and other tobacco products ahead of the 2027 legislative session.
The proposal was presented to the Legislature’s Joint Interim Standing Committee on Revenue by the Nevada Tobacco Control & Smoke-Free Coalition, whose members include the American Cancer Society Cancer Action Network, the American Lung Association, and the Southern Nevada Health District. A major National Bureau of Economic Research study found that Minnesota’s tax on e-cigarettes prevented approximately 32,400 adult smokers from quitting. The study also found that every 10 percent increase in e-cigarette taxes reduced vapor sales by 26 percent while increasing cigarette sales by 11 percent, suggesting higher taxes can push smokers back toward combustible cigarettes.
The coalition is calling for Nevada’s cigarette tax to increase from $1.80 to $3.55 per pack while raising the tax on other tobacco products from 30 percent to 47 percent of the wholesale price. Supporters estimate the proposal would generate approximately $65.8 million in new annual revenue, with a portion directed toward tobacco prevention and cessation programs.
A tobacco tax hike would also hurt Nevada’s small businesses. Convenience stores, gas stations, and other local retailers rely heavily on tobacco sales to attract customers and drive in-store purchases. Nationwide, tobacco products account for nearly 30 percent of all convenience store sales, making them one of the industry’s largest revenue drivers. Higher taxes encourage consumers to purchase tobacco products online, across state lines, or through illicit markets, reducing sales for local businesses and the tax collections supporters promise.
The coalition argues the proposal will both reduce tobacco use and generate millions in new government revenue. Those two promises cannot both be true over the long term. If higher tobacco taxes reduce smoking and nicotine use, the tax base shrinks, making projected revenues increasingly unreliable.
History bears this out. A study examining 32 state tobacco tax increases between 2009 and 2013 found that only three met their projected revenue targets. As legal sales decline and consumers seek lower-cost alternatives, collections often fall well short of expectations.
The proposal would also substantially increase taxes on nicotine pouches, electronic cigarettes, and other smoke-free nicotine products. Raising taxes on these products increases costs for adults who have switched away from traditional cigarettes while reducing incentives for smokers to choose lower risk alternatives.
Supporters also overlook that tobacco taxes are among the most regressive taxes governments impose. Because lower-income Americans are more likely to use tobacco products than higher-income individuals, these excise taxes place the greatest burden on those least able to afford higher prices.
Nevada has long maintained a competitive tax climate that has helped attract businesses and investment. Nearly doubling tobacco taxes while expanding them to additional nicotine products moves the state in the opposite direction. Rather than relying on another regressive tax hike to raise government revenue, lawmakers should reject this proposal and continue pursuing policies that strengthen Nevada’s economy and protect taxpayers.
