Vapor products tax

Effective March 27, 2021, the Preventing Online Sales of E-Cigarettes to Children Act extends the Jenkins Act and Prevent All Cigarette Trafficking (PACT) Act. This covers all electronic nicotine delivery system (ENDS) products, including related components, liquids, parts, and accessories that do not contain nicotine. Learn more.

What is a vapor product?

A vapor product is any noncombustible product containing a solution or other consumable substance, regardless of whether it contains nicotine. It employs a mechanical heating element, battery, or electronic circuit that can be used to produce vapor from the solution or other substance, regardless of the shape or size.

Vapor products include electronic cigarettes, electronic cigars, electronic cigarillos, electronic pipes, or similar products or devices. Vapor products also include any cartridge or other container of liquid nicotine, solution, or other consumable substance, regardless of whether it contains nicotine. Vapor products are intended to be used with or in a device that can be used to deliver aerosolized or vaporized nicotine to a person inhaling from the device and is sold for such purpose.

Vapor products do not include:

  • Products approved by the United States Food and Drug Administration as tobacco cessation products.
  • Any products that will become an ingredient or component in a vapor product manufactured by a distributor.
  • Marijuana, useable marijuana, marijuana concentrates, or marijuana-infused products.
  • Cigarettes.
  • Tobacco products.
  • Room deodorizers.
  • Essential oils.
What is the tax rate?

There are two vapor products tax rates, and the rate that applies to your inventory depends on the volume of solution and type of the container.

Vapor products tax rates:

  • Accessible containers of solution greater than 5mL: $0.09 per mL.
  • All other vapor products: $0.27 per mL.
Credits available

You may claim a credit on your combined excise tax return for Washington’s vapor products tax previously paid if you remove the product from your inventory in Washington by:

  • Shipping or transporting the products outside Washington to a person engaged in the business of selling vapor products and the products are to be sold by that person.
  • Returning the products to the manufacturer.
  • Destroying the products.
  • Selling the products to the U.S. government or other entities authorized in RCW 82.25.105(1)(a).

Industry type

Consumers

If you purchase vapor products online from a seller who has not paid the Washington vapor products tax, or purchase them outside Washington and bring them back to Washington, then you owe the vapor products tax. You must submit a Vapor Consumer Use Tax Return and pay the tax directly to the Department of Revenue.

Retailers

You owe the vapor products tax if you:

  • Purchase vapor products from distributors who have not paid the vapor products tax.
  • Bring untaxed vapor products into Washington from outside Washington.

You must report your purchases of untaxed vapor products you possess in Washington on your excise tax returns. You must also report your sales of vapor products on the excise tax returns under the retailing business and occupation tax, and collect and submit sales tax on your sales of vapor products.

Distributors

You owe the vapor products tax if you do either of the following:

  • Purchase vapor products from manufacturers or other distributors who have not paid the vapor products tax.
  • Bring untaxed vapor products into Washington from outside Washington.

You must report your purchases of untaxed vapor products you possess in Washington on your excise tax returns. You must also report your sales of vapor products on the excise tax returns under either the wholesaling or retailing business and occupation tax, depending on the nature of the sale. For sales reported under the retailing tax classification, you must also collect and submit retail sales tax.

Manufacturers

You owe the vapor products tax on all vapor products you manufacture or possess in Washington. This tax is reported on your excise tax returns. You must also report your production activity (manufacturing) and selling activity (wholesaling and/or retailing) on your excise tax returns. See our Manufacturing guide for more information.

Consignment sales

In regards to consignment sales, the party with first possession of the vapor products in Washington is responsible for paying the tax. For reporting existing vapor floor stock inventory, it is the party with first possession on the date the law went into effect, Oct. 1, 2019.

  • If the consignor operates within Washington and is the first to possess the vapor products within this state, it is responsible for paying the vapor tax.
  • If the consignor of the vapor products is an out-of-state business and it consigns its vapor products to a Washington consignee for sale in Washington, the consignee is responsible for paying the vapor tax.

Electronic Nicotine Delivery Systems (ENDS)

Electronic Nicotine Delivery Systems

Effective March 27, 2021, the Preventing Online Sales of E-Cigarettes to Children Act extends the Jenkins Act and Prevent All Cigarette Trafficking (PACT) Act to cover all electronic nicotine delivery system (ENDS) products, including related components, liquids, parts, and accessories that do not contain nicotine.

Under the Preventing Online Sales of E-Cigarettes to Children Act, sellers must:

  • Register with the tobacco tax administrator of any state where shipments are made or advertisements or offers are disseminated.
  • Collect all applicable local taxes.
  • Share all monthly shipments made to each state’s tax administrator, following that state's reporting rules.
  • Maintain records for five years of any delivery interruptions or incomplete deliveries due to failure to confirm identify.
What is an ENDS?

An ENDS is any electronic device that, through an aerosolized solution, delivers nicotine, flavor, or any other substance to the user by inhaling from the device.

Examples include:

  • E-Cigarettes.
  • E-Hookahs.
  • E-Cigars.
  • Vape pens.
  • Advanced refillable personal vaporizers.
  • Electronic pipes.
  • Any components, liquids, parts, or accessories of a device.

An ENDS does not include a product that is approved by the Food and Drug Administration for sale as a tobacco cessation product or any other therapeutic purpose.

How do I report ENDS sales?

You must report ENDS sales on the Schedule C4 (ENDS) form.

The following sales need to be reported:

  • Interstate shipments into Washington.
  • In-State Distributor’s report of interstate and/or in-state exempt sales.
When is the report due?

Schedule C4 (ENDS) is due no later than the 15th day of each month for the previous month’s shipments.

What if I do not have any sales in Washington?

You must file a report with the box checked indicating no sales activity.

Where do I send the report?

Send Schedule C4 (ENDS) to Taxpayer Account Administration by choosing one of the following methods:

  • Email to: DORCigarettes@dor.wa.gov
  • My DOR message: Click the Send a secure message link.
    • For the account, you may select either: No Account or Excise Tax.
    • For the topic, select Message Type: Cigarette, Vapor & Tobacco Tax.
    • Go to “Send a Secure Message to DOR” for further instructions.
  • Mail to:

Department of Revenue
Taxpayer Account Administration Division
Attention: Cigarette Tax
PO Box 47476
Olympia, WA 98504-7476.

What records do I need to keep?

You must keep all sales invoices and shipping records for five years. Invoices need to include the following information:

  • Name and address of the seller.
  • Name and address of the purchaser (if sold to a reseller).
  • Date of sale.
  • The brand, type of product(s) sold, including name, type of container, and container volume.
  • Number of each type of product sold.
  • Name, address, and phone number of the delivery service.
Do I need to be registered in Washington?

Yes, if you are a business shipping or selling ENDS products through interstate commerce in Washington, or disseminating advertisements or offers, you need to complete the PACT Act Registration form generated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and email it to the DOR Cigarettes mailbox.

If you owe vapor products tax or other Washington state taxes, you need to register with the Department of Revenue by completing a Business License Application.