End Tobacco Loopholes Act

This bill raises federal taxes on cigarettes and other tobacco products and makes the tax rates more equal across products. It also adds a new federal tax on nicotine used for vaping and similar products. The bill creates a clear category for single-use nicotine items like pouches, lozenges, and dissolvable strips, and sets a tax of $100.66 per 1,000 of those units. After 2026, these taxes will go up each year with inflation. Stores will owe a one-time tax on unsold tobacco stock when the new rates start, with a $500 credit and 120 days to pay. Nicotine used in FDA‑approved or investigational medicines is not taxed.

Key points

• Who is affected: People who buy cigarettes, cigars, pipe/roll‑your‑own and smokeless tobacco, nicotine pouches/dissolvables, and vaping products; plus retailers and manufacturers.
• What changes: Higher tobacco taxes; a new tax on nicotine used for vaping (based on how much nicotine is in the product); clear taxes for single‑use nicotine items at $100.66 per 1,000; annual inflation adjustments after 2026; one‑time tax on existing store inventory when rates rise. Medicines with nicotine approved by FDA are excluded.
• When: Most changes start the month after the bill becomes law; single‑use units and processed tobacco changes start 6 months later; the new nicotine tax begins about 6 months after enactment; large cigar changes begin after December 31, 2025.