The second of these two North Carolina debates is whether or not to impose their current 4.75% general state sales tax on the electronic cigarettes themselves, but doesn’t collect the federal or state excise tax on the nicotine containing e-liquid as it does on other nicotine related products. At the center of this issue is the fact that E-cigarettes do not contain or burn any tobacco. Rather, e-cigarettes use batteries to heat and vaporize a nicotine containing liquid or E-liquid. It is because of this, the U.S. Food & Drug Administration or FDA has labeled these devices as “tobacco products” which are subject to the federal excise tax. If this legislation is implemented in the 2014 summer short session, the expected revenue that it is projected to bring in by fiscal year 2016 is around $5 million a year.

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