Delaware Advances Bill to Hike Tobacco and Vape Taxes
Delaware lawmakers have advanced legislation to significantly increase taxes on cigarettes, vapes, and nicotine pouches starting September 2026, aiming to curb youth addiction and generate state revenue.
- Cigarette Tax Jump: The per-pack tax would increase from $2.10 to $3.60.
- Vape Tax Doubled: Taxes on e-liquids would rise from 5 cents to 10 cents per fluid milliliter.
- Revenue Boost: The measure is projected to generate $18.5 million in FY 2027 to help offset $532 million in annual tobacco-related healthcare costs.
Delaware’s House Administration Committee has advanced a revised bill to increase the state’s tobacco tax for the first time in nearly a decade. Driven by a need to offset massive healthcare costs and deter youth nicotine use, House Substitute 1 for HB 215 proposes steep tax hikes on cigarettes, e-cigarettes, and newly defined nicotine pouches.
House Speaker Melissa Minor-Brown, who sponsored the bill alongside Senate Pro Tempore Dave Sokola, emphasized that raising taxes is one of the most effective methods to prevent youth initiation and encourage quitting. Currently, nearly 20% of Delaware high school students use e-cigarettes.
The legislation explicitly updates the state’s legal definition of tobacco products to include items containing or derived from nicotine, closing loopholes for modern oral nicotine pouches. If passed, the new tax structure will take effect on September 1, 2026.
| Product Category | Current Tax Rate | Proposed Rate (Sept 2026) |
|---|---|---|
| Cigarettes | $2.10 per pack | $3.60 per pack |
| Vape Products | $0.05 per fluid ml | $0.10 per fluid ml |
| Other Tobacco/Nicotine | 30% of wholesale price | 40% of wholesale price |
| Moist Snuff | $0.92 per ounce | $1.23 per ounce |
*Note: Under the revised bill, premium cigars will maintain their current tax rate of 30% of the wholesale price.
In addition to product taxes, the bill will double the cost of doing business for tobacco vendors starting January 1, 2027. Retailer licensing fees will increase from $50 to $100, while wholesaler fees will jump from $200 to $400.
The proposal faces strong opposition from the retail sector. Representatives from the National Convenience Distributors argued that Delaware currently benefits from lower taxes than neighboring Maryland ($5.00). They warned that pushing the tax to $3.60—making it more expensive than Pennsylvania ($2.60) and New Jersey ($3.00)—will kill cross-border sales and harm local businesses.
To become law, the bill faces a significant legislative hurdle: Delaware requires a three-fifths majority vote in both chambers to increase a state tax. The measure now heads to the House floor, where it needs 25 votes to advance to the Senate.
- News reference: Delaware lawmakers advance bill to raise tobacco taxes
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