Bottom Line: Minnesota's 95 percent e-cigarettes tax is a natural experiment to examine the impact of e-cig taxes on smoking rates. Consistent and robust evidence demonstrates that the Minnesota e-cig tax increased adult smoking relative to what it would have been in the absence of this tax. This finding suggests that similar e-cig taxes in other states will also reduce the smoking quit rate nationwide.
This study provides some of the first rigorous evidence on how taxing e-cigs impacts smoking cessation among adults. It finds strong evidence that higher e-cig taxes increase adult smoking rates and reduce quits. This conclusion implies that e-cigs are a likely substitute for conventional cigarettes among current smokers.
Specifically, the 95 percent e-cig tax in Minnesota, the first such tax increase in the nation, led to a decrease in cigarette smoking cessation by about 1.14 percentage points -- approximately a 5 percent increase in relative smoking participation. In fact, virtually all of the increase in current smoking prevalence in Minnesota is associated with the e-cig tax and the associated decrease in successful quits.
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