FISCAL NOTE
Date Requested: January 30, 2026
Time Requested: 06:07 PM |
| Agency: |
Tax & Revenue Department, WV State |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 2286 |
Introduced |
SB673 |
|
|---|
| CBD Subject: |
Taxation |
|---|
|
FUND(S):
Special Revenue Fund for PEIA
Sources of Revenue:
General Fund
Legislation creates:
Decreases Existing Revenue, Increases Existing Expenses, Creates New Fund: Special Revenue Fund for PEIA
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
Summarize in a clear and concise manner what impact this measure will have on costs and revenues of state government.
The stated purpose of this bill is to increase the tax on e-cigarette liquid and direct that these taxes be used to fund PEIA.
According to our interpretation, this bill increases the excise tax to three cents per milligram of nicotine on all electronic cigarette products. The current tobacco excise tax on electronic cigarettes is 7.5 cents per milliliter. This bill assumes that closed systems contain 40 milligrams of nicotine per unit and open systems contain 6 milligrams of nicotine per milliliter. From a unit tax perspective, open systems would be taxed at $0.18 per milliliter and closed systems would be taxed at $0.67 per milliliter. Effective July 1, 2026, all revenues from this proposed excise tax would be deposited into a special revenue fund for the Public Employees Insurance Agency. Passage of this bill would reduce General Revenue Fund collections by $7.0 million per year and create a gain of $22.6 million per year for the Public Employees Insurance Agency Special Revenue Fund in FY2027 and thereafter.
Additional administrative costs incurred by the State Tax Department would be $51,150 in FY2026 and $49,550 in FY2027 and thereafter.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2026
Increase/Decrease
(use"-") |
2027
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
51,150 |
49,550 |
49,550 |
| Personal Services |
0 |
49,550 |
49,550 |
| Current Expenses |
1,650 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
49,500 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
-7,000,000 |
-7,000,000 |
Explanation of above estimates (including long-range effect):
Please explain increases and decreases in personal services, current expenses, repairs and alterations, assets, other costs and revenues, including assumptions and data sources and delineation between start-up and ongoing costs. Please also include a long-range schedule of costs and revenues if fiscal impact is expected to vary in future years.
According to our interpretation, this bill increases the excise tax to three cents per milligram of nicotine on all electronic cigarette products. The current tobacco excise tax on electronic cigarettes is 7.5 cents per milliliter. This bill assumes that closed systems contain 40 milligrams of nicotine per unit and open systems contain 6 milligrams of nicotine per milliliter. From a unit tax perspective, open systems would be taxed at $0.18 per milliliter and closed systems would be taxed at $0.67 per milliliter. Effective July 1, 2026, all revenues from this proposed excise tax would be deposited into a special revenue fund for the Public Employees Insurance Agency. Passage of this bill would reduce General Revenue Fund collections by $7.0 million per year and create a gain of $22.6 million per year for the Public Employees Insurance Agency Special Revenue Fund in FY2027 and thereafter.
Additional administrative costs incurred by the State Tax Department would be $51,150 in FY2026 and $49,550 in FY2027 and thereafter.
Memorandum
Please identify any areas of vagueness, technical defects, reasons a bill would not have a fiscal impact, and/or any special issues not captured elsewhere on this form.
The stated purpose of this bill is to increase the tax on e-cigarette liquid and direct that these taxes be used to fund PEIA.
Some definitions in this bill may need more clarification as the term “electronic smoking cigarette” is already defined under W.Va. Code §16-9A-2. An “electronic smoking cigarette” is (in part) defined as “any device that can be used to deliver any heated, aerosolized, or vaporized substance to the person inhaling from the device, including but not limited to, any e-cigarette, e-cigar, e-pipe, vape, pen, or e-hookah.
Person submitting Fiscal Note: Mark Muchow
Email Address: radfiscal@wv.gov