ID H0884

Establishes new permit requirements for manufacturers, distributors, and retailers of alternative nicotine products, tobacco products, and electronic smoking devices, with a one-time $50 manufacturer permit fee and $25,000 surety bond required for nonresident/foreign electronic smoking device manufacturers.

Imposes new excise taxes on vapor products at 5 cents per fluid milliliter and on alternative nicotine products at 25 cents per container of 1-20 units (plus proportionate tax on units exceeding 20).

Distributes vapor/alternative nicotine product tax revenue: 50% to Department of Health and Welfare for behavioral health programs, 25% to public school income fund for safe and drug-free schools, and 25% to the general fund.

Creates escalating penalties for permit violations: first offense $500 per product, second offense $1,000 plus 7-day permit suspension, third offense $2,000 plus 30-day suspension, fourth offense $5,000 plus permit revocation.

Requires all sales of regulated nicotine products occur only between permitted entities, with manufacturers and distributors required to verify purchaser permits before completing sales, effective July 1, 2026.