New federal tobacco law leaves questions about enforcement

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This Tuesday, Dec. 17, 2019 photo shows a group of cigarettes in New York. On Tuesday, Dec. 17, 2019, the U.S. Food and Drug Administration endorsed a type of cigarette that could help ease the addictive grip of smoking by delivering very low levels of nicotine. (AP Photo/Patrick Sison)

SIOUX FALLS, S.D. (KELO) — There’s a new law in town, but who is going to enforce it?

The federal legislation is banning tobacco sales to persons under 21. The law was tucked into year end legislation. It was passed by the U.S. House and Senate and signed by President Donald Trump on December 20.

While the Federal Food and Drug Administration (FDA) and the South Dakota Retailer’s Association have advised retailers in the state to stop selling tobacco to persons under 21, a big question is, who will punish them if they keep selling?

“This is a federal law, who enforces it, who prosecutes it…,” said Tim Bormann, the chief of staff for the South Dakota Attorney General. “The state doesn’t know how to enforce this.”

The state has laws and penalties for tobacco sales and related use that apply to those under 18.

Bormann said local police, local sheriff’s offices and state county attorneys are responsible for enforcing the state law.

Also, the FDA has not updated regulations in relation to the new federal law which leads to questions about enforcement and when the new law could be enforced, Bormann said.

“I don’t want to say we were left hanging but we were left hanging,” Bormann said.

As of December 27, the FDA, the agency responsible for federal compliance on tobacco sales and use, had not released details on enforcement of the new federal law. It does have this statement on its website:

“It is now illegal for a retailer to sell any tobacco product – including cigarettes, cigars and e-cigarettes – to anyone under 21.”


The FDA said on its website that it will provide additional details on the new law as they become available.

The ban covers all tobacco products including cigarettes, e-cigarettes, hookah tobacco and cigars.

Although there are questions about enforcement and penalties for the new federal law, Bormann doesn’t disagree with the advice from the South Dakota Retailers Association.

He said tobacco retailers should err on the side of caution but “do what you think as a retailer is right.”

South Dakota law SDCL 10-5-19 requires retailers that sell tobacco products to register with the Department of Revenue, said Wade LaRoche of the Department of Revenue. The department has 2,077 entities that are registered retailers under that law, LaRoche said.

Although states were aware of a possible under 21 tobacco ban discussion, this legislation seemed to come quickly, he said. Now, they are now left wondering about the federal government and FDA’s plan, Bormann said.

On Friday, Bormann said he’d spent at least the past day and a half reading about the new federal law.

The details of the new federal law won’t likely be known for at least several weeks.

Bormann said the FDA has 180 days from December 20 to complete the rules and then it would be no later than 90 days for rules to take effect.

“The closest thing I can compare this to is in the 1980s with the drinking age,” Bormann said.

But when the U.S. moved toward an alcohol use and sales ban for those under 21, it was more of a step process in South Dakota.

South Dakota first allowed only 3.2% alcohol sales to persons 18 and over. The state later allowed only 3.2% alcohol sales to person 19 and over. Eventually, the ban applied to those under 21.

Bormann said the state implemented the alcohol sales and use ban for those under 21 after the federal government said it would withhold federal highway money to states that didn’t pass the ban.

Tobacco sales generate revenue for the state.

A per pack tax on cigarettes is paid by tobacco distributors. The state tax on a 20-pack of cigarettes is $1.25. The tax on a 25-pack of cigarettes is $1.92. A stamp on the pack shows the tax has been paid.

Also, retail sales of cigarettes and other tobacco products are subject to the 4.5% state sales tax rate plus the municipal general rate in addition to any cigarette or tobacco tax, according to the department of revenue.

The Other Tobacco Product Tax (OTP) is paid by wholesalers and distributors when they ship or deliver the products other than cigarettes, such as snuff and cigars, to a South Dakota retailer. That rate is 35% of the wholesale price.

The state has received about $23.7 million in revenue from tobacco taxes through November 2019 for fiscal year 2020, according to the South Dakota Bureau of Finance and Management’s monthly revenue report. The fiscal year started on July 1, 2019, and ends on June 30, 2020.

The first $30 million of taxes collected goes into the state’s general fund, according to the Department of Revenue. The next $5 million goes into the Tobacco Prevention and Reduction Trust Fund. Any amounts after $35 million are placed in the state’s general fund.

An under 21 tobacco law would likely reduce the revenue collected by the state, but the state also spends money on illnesses related to tobacco use.

The South Dakota Department of Health’s South Dakota Tobacco Control State Plan 2015-2020 said tobacco use costs the state, “$373 million in health care expenditures and another $233 million in lost productivity each year. The portion of this cost covered by the state Medicaid program is $58 million.”

The plan estimated the annual per household cost in state and federal taxes as $587.

A 2014 study published by the American Health Journal said 2% of all tobacco sales are attributed to persons under 21. And that most users start before 21.

If an under 21 ban results in fewer users under 21, then sales over their lifetime would be lost.

Advocates for an under 21 tobacco ban say restricting access to those under 21 will help prevent them from tobacco use and reduce the negative health impacts from smoking.

The American Lung Association said 94% of adults who smoke started before age 21 and 81% did so before age 18. The group said that banning access to those under 21 will help curb the trend from experimentation to full use.

Most U.S. states do not have under 21 tobacco law but 19 states have passed such a law.

Those nineteen states are: Arkansas, California, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, New Jersey, New York, Ohio, Oregon, Pennsylvania, Texas, Utah, Vermont, Virginia and Washington implemented under 21 tobacco bans before December 20.

Copyright 2021 Nexstar Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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