Months ahead of the 2026 legislative session, lawmakers in New Mexico are already laying the groundwork for a tax hike on reduced-risk nicotine products, a move that would push consumers toward more dangerous combustible tobacco. In the last failed attempt, Representative Liz Thompson and Senator Martin Hickey sponsored a bill that would have mislabeled nicotine products as “tobacco” products and taxed them at a whopping 40%.
Treating reduced-risk products identically to higher-risk ones misleads consumers and would contribute to the thousands of New Mexico residents who die from smoking tobacco each year. Yet, the Democratic proposal would have defined tobacco products as containing nicotine—no actual tobacco required. Except for cigarettes, which the bill gave a special carveout. This nonsensical approach would have cost lives. Thankfully, it died in committee.
Lawmakers have been trying to tax reduced-risk nicotine products at the same rate as cigarettes for years, without regard for the plain fact that some are deadly cancer sticks, while others are 95% safer substitutes. They’re different and should be treated as such.
But high taxes on nicotine products are self-defeating in other ways, too. Higher taxes in one state shift consumption to lower-tax neighbors, costing revenue for the state imposing the tax. Purchases that do occur in high-tax states are pushed underground to illicit markets. That leaves people vulnerable to underage sales, product tampering, and unsafe environments. These consequences often fly in the face of policy advocates’ own stated goals.
Higher taxes on nicotine products discourage smokers from switching, worsening health outcomes, and further straining state health care systems. Further, they push people into exploitative black markets or across state lines. Instead of recognizing these issues, New Mexico Democrats have stuck to the rotten approach of “If it moves, tax it!” With their state consistently experiencing negative net migration, they may want to consider the alternative: if you tax it, it moves.
