John Trott, owner of Fog Vapes in the Gateway Shopping Center in Edwardsville and New Castle, already laid off one person, expects to lay off more in the future and could be forced close his e-cigarette stores.
By Denise Allabaugh | August 16th, 2016
Trott says a 40-percent wholesale tax that will be imposed on vapor products in Pennsylvania starting Oct. 1 is just the tip of the iceberg.
He said new regulations from the U.S. Food and Drug Administration will kill the vaping industry, which has more than 300 stores in Pennsylvania.
Under the new regulations that govern the manufacture and sale of electronic cigarettes, it will cost an estimated $1 million or more for each e-cigarette or vaping product to seek federal approval.
Trott said he has 1,300 items and cannot afford the cost. He employs about 14 people.
The new regulations also include a ban on selling to minors and identification requirements, he said.
Additionally, vape shop retailers can no longer give out free samples and are limited in their ability to mix e-liquids to create new flavors, according to Trott.
Trott called the regulations the “crusher of the entire industry” that could lead him to shut down.
“I’ve already lost everything at this point,” he said. “I tried to work for the American dream and they got me good.”
Trott smoked nearly three packs of Marlboro cigarettes a day until May 2013, when he tried what he calls a “personal vaporizer.” He said he hasn’t touched a cigarette since.
Now, he also charged he would have to lie to his customers by putting warning labels on products that do not contain nicotine.
With higher taxes on products in Pennsylvania, Trott expects people may buy products in other states.
“It’s an unfair playing field,” he said. “Pennsylvania will no longer be able to be competitive.”
Brian Goble, who operates Xhale Vapor Lounge in Wilkes-Barre and Scranton, said the two vape shops also may have to close as a result of the new FDA regulations and 40-percent wholesale tax that will be imposed on vapor products in Pennsylvania.
“It’s literally going to hurt us,” Goble said. “We’re not giving up. We’re trying to do something to change it but everything we’ve done to fight it has failed miserably. There’s not enough people to help fight.”
Goble said he and his partners do not want to close but going forward, they might have to.
The 40-percent wholesale tax on vapor products requires that every vape shop in Pennsylvania write a check to the state for 40 percent of the wholesale value of their entire inventory.
Trott and Goble said this tax would be imposed on older products as well.
They claimed no shop can pay this tax or they would be out of business.
“That’s what would kill us,” Goble said. “I don’t think they want vaping around. That’s my take on it.”
Tobacco products in Pennsylvania, like chewing tobacco and smokeless tobacco, also will be taxed starting in October as a result of the new state budget.
The higher taxes follow Pennsylvania’s cigarette tax going up an extra dollar per pack at the beginning of the month.
At Anthracite Newstand on Public Square in Wilkes-Barre, it now costs $8.37 for a pack of Newport and $8.31 for a pack of Marlboro cigarettes. The cheapest pack of cigarettes are generic and cost $6 a pack, said co-owner Ann Marie Bossard.
“People are going crazy over it,” Bossard said. “It’s been a real big hike for a lot of people. A lot of people can’t afford a pack of cigarettes now.”
Bossard said she is concerned about robberies and people stealing cigarettes.
Some people are asking if they could just buy two or three loose cigarettes and the sale of cigarettes is slowing down, Bossard said.
“A lot of people aren’t coming in as much,” she said.