BILL NUMBER:  S2542A

 TITLE OF BILL :  An act to amend the tax law, in relation to the
registration of vendors of electronic cigarettes

 PURPOSE :

To ensure all sellers of electronic cigarettes are registered and
subject to compliance checks

 SUMMARY OF PROVISIONS :

Section one adds a new Article 20-C to the Tax Law, requiring any
person selling or offering for sale electronic cigarettes or liquid
nicotine, who that is not registered with the Department of Taxation
and Finance to sell tobacco products, to register under this section.
The Commissioner shall adopt regulations to establish the registration
requirement and ensure compliance.

Section two provides the effective date.

 JUSTIFICATION :

In 2012, the state banned the sale of electronic cigarettes to minors
under the age of 18. Despite enactment of this ban to minors in New
York and a number of other states, the CDC reports the use of
              

electronic cigarettes among middle school and high school students has
more than doubled from 2011 to 2012. The health effects of electronic
cigarettes remain unknown, and while the FDA recently issued proposed
regulations on electronic cigarettes, which includes a nationwide ban
of the sale to minors, electronic cigarettes remain unregulated. Since
they are unregulated, electronic cigarette packages are not required
to include health warnings and they can contain flavored electronic
nicotine, which can often entice minors.

Although banned to minors in this state for several years, enforcement
of this provision has been problematic. Chapter 448 of 2012 included
electronic cigarettes in the Public Health Law provisions banning sale
to minors. Chapter 542 of 2014 expressly included liquid nicotine in
the ban to minors. Since these changes did not add electronic
cigarettes or liquid nicotine to the definition of a "tobacco product"
under the Tax Law, retailer's that sell only these products and not
traditional tobacco products do not need a tobacco registration from
the Department of Taxation and Finance. As a result, when electronic
cigarettes are sold in stores that do not sell traditional tobacco
products, these retailers are not registered and there is no way for
the Department of Health's Enforcement Unit to know they are selling
electronic cigarettes and to conduct compliance checks to ensure they
are not selling to minors. By requiring retailers that are not
registered under Article 20, to register under this new article the
bill ensures that State and localities can conduct compliance checks
to confirm adherence to existing law.

This bill also seeks to address the point raised by the Governor's
Veto message in 2016, claiming the bill would create a significant
burden on the Department of Health. Given the Department of Tax and
Finance already registers tobacco retailers, simply adding these
retailers pursuant to regulations established by the Department,
should not be an onerous new burden.

 LEGISLATIVE HISTORY :

2016: S.6003 - Veto # 275
2015: S.6003 - Passed Senate, died in Assembly
2014: S.7139 - Passed Senate, died in Assembly

 FISCAL IMPLICATIONS :

 None.

 EFFECTIVE DATE :
Effective the first day of the month commencing after the 180th day
after enactment; provided addition, amendment and/or repeal of any
rule or regulation necessary for implementation is effective
immediately.