Vape stores are facing new taxes and regulations in Louisiana

Taxes and regulations aimed at discouraging the use of vape products could affect the trajectory of small businesses across Louisiana.

Just 12 years ago vape stores were an oddity across the Shreveport-Bossier area. In 2011, Debra Johnson, an auctioneer, saw an opportunity and opened a vape booth at an antique market in south Shreveport. "There weren't that many people doing it then," said Johnson.

What was seen a new fad quickly grew in popularity.

According to the Centers for Disease Control and Prevention (CDC), e-cigarettes and prefilled mint cartridges increased nationwide 122.2% in sales from Sept. 2014 to May 2020.

Johnson said, "within a month or two we had continuous customers." Johnson a prior cigarette smoker started smoking vapes 13 years ago in hopes to stop smoking cigarettes, and says she found success with e-cigarettes.

But as time progressed Johnson faced difficulties finding the e-cigs and while at a flea market with her husband, she stumbled across vape pens. The vendor was out of Texas and for a couple of months Johnson shipped in the vape liquid.

Johnson said, "this went on for maybe five or six months and then I started saying you know what? I really need to do something because I want to get it for myself and I'm sure there's others out there that need it too."

Johnson built a team that learned everything about vapes and as time went on, due to popularity they were forced to open a brick-and-mortar location on Mansfield Rd. called Unlimited Vapor.

But Johnson says the business took a hit when the new regulations went into effect. Now vape stores across Louisiana are mandated to follow strict regulations and taxes on the products themselves could ultimately close down small businesses across the state.

"The FDA came in and started hitting us with all kinds of regulations. We have our own brand of juice, and we have it manufactured in California. We had to submit that to the FDA, all of our ingredients and how much," said Johnson.

Vape stores are known for creating their own juices with different flavors but the process to submit to the FDA can cost between $100,000 to $500,000 per product.

Johnson submitted her products to the FDA when the regulation went into effect with no cost, but she said some shops around town did not which could negatively impact them in the long run. "We did it from the get-go, we complied as we went along," said Johnson. "That way, we're not going to be devastated because we can't do what they are saying we have to do."

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Today Unlimited Vapor stands with limited supply due to the recent increase in state taxes on nicotine vape products and e-cigarettes. On June 15, 2023, Louisiana Gov. John Bel Edwards signed into law the bill to increase the excise tax on vapes from 5 cents per milliliter of nicotine solution to 15 cents.

"We usually special order it for customers, if they know what flavor they want, what milligram they want, because of the excise tax going up as high as it is, we don't want to order it and have it just sitting there," said Selena Price, manager of Unlimited Vapor.

The tax increase went into effect on July 1, and is only impacting Louisiana. Border states such as Texas, Arkansas and Mississippi have no excise tax on vape and e-cigarette products.

Rep. Paul Hollis of Covington sponsored House Bill 635 Act 414 to discourage the use of vape and e-cigarette products through an increase in excise tax. The Shreveport Times reached out to Hollis for a statement, but did not receive a response.

In early June the House advanced this bill with 83 in support and 13 in opposition and gained a unanimous Senate approval. According to the Legislative Fiscal Office, this tax bump is expected to generate an additional $9.8 million in revenue.

But what does that mean for local business owners like Johnson who are seeing a decrease in product and customers? "We are hanging in there, and we hope to hang in there for quite a while," said Johnson.

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Makenzie Boucher is a reporter with the Shreveport Times. Contact her at [email protected].