HB529 Alabama 2025 Session

Summary

Primary Sponsor

David FaulknerRepresentative

Republican

Session

2025 Regular Session

Title

Taxation, taxation of vapor products provided for

Summary

HB529 creates a new excise tax on consumable vapor products, sets licensing and reporting rules, builds a state directory for e-liquids, and preempts local taxes while strengthening enforcement.

What This Bill Does

Imposes a 0.10 dollar per milliliter excise tax on consumable vapor products sold wholesale or imported for use or sale in Alabama, starting October 1, 2026, with exemptions for certain exports. Replaces certain volume-based business license fees with the new tax and requires retailers to obtain a vapor product license, maintain records, and report monthly; penalties apply for not obtaining licenses or for violations. Distributes tax proceeds: 50% to the State General Fund, 25% to counties by population, and 25% to municipalities by population; counties or municipalities that levy local vapor product taxes may not receive these distributions. Creates a comprehensive directory and certification framework for e-liquids and alternative nicotine products, requires manufacturer certifications tied to FDA Premarket Tobacco Applications, imposes fees, and enforces strong penalties (including daily fines) for selling unlisted or non-compliant products; authorizes enforcement and confiscation of non-permitted products.

Who It Affects

• Vapor product retailers, wholesalers, importers, and manufacturers (including electronic nicotine delivery systems and e-liquids) who must obtain licenses, keep records, file monthly tax returns, and comply with the new directory and certification requirements.
• Consumers and the general public (including age-restricted purchasing) who will face the new excise tax and age-verification rules, and who are affected by preemption of local vapor product taxes and the broader regulatory environment.

Key Provisions

• Section 2(a): Establishes a ten-cent-per-milliliter excise tax on consumable vapor products sold in Alabama or imported for sale, with exports exempt.
• Section 2(b)(2): The new tax is in lieu of certain volume-based business license fees; prior local business license fees on selling consumable vapor products enacted before Oct 1, 2025 are void.
• Section 3(a): Tax proceeds are remitted to the Department and distributed quarterly: 50% to the State General Fund, 25% to counties by population, 25% to municipalities by population; Section 3(b) excludes counties/municipalities that levy local taxes on vapor product sales from distributions.
• Section 4: Requires licensing to engage in selling vapor products, monthly reporting and payment by the 20th, and provides a 4.75% early payment discount; failure to license or report leads to penalties and potential denial of license.
• Section 5: Establishes penalties for failing to report or keep required records (Class B misdemeanor, with each month counting as a separate offense).
• Section 6: Alabama Alcoholic Beverage Control Board or law enforcement may confiscate non-permitted vapor products, which are destroyed.
• Section 7: Amends definitions and creates a Tobacco Permit system and a public directory for e-liquids and alternative nicotine products, including detailed terms for electronic nicotine delivery systems, e-liquids, and manufacturers; imposes certification and reporting requirements related to FDA Premarket Tobacco Applications (PMTAs).
• Section 7: Imposes fees for certifications ($2,000 initial; $500 annual renewal) and directs how funds are used; requires products to be listed in a public directory with monthly updates.
• Section 7: Establishes penalties (including up to $1,000 daily fines) for selling unlisted products, and outlines conforming procedures to update the directory as federal rules change.
• Section 9: The act becomes effective on October 1, 2025.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation & Revenue