House committee advances tax structure for FDA‑authorized modified‑risk tobacco products after heated debate

The House Committee on Ways and Means on May 6 advanced House Bill 669, which creates a tax framework that would allow FDA‑recognized modified‑risk tobacco products (MRTPs) to be brought to the Louisiana market and taxed at a reduced rate compared with traditional cigarettes.

Representative Neil Reiser, sponsor of HB 669, told the committee the measure clarifies taxable events for novel tobacco delivery forms and authorizes reduced excise rates for MRTPs in order to comply with the state’s tobacco settlement requirements. Reiser said the amendment adopted earlier in the hearing bifurcates reduced rates: a larger reduction for products granted a full MRTP order and a smaller reduction for products authorized under an exposure‑modification order by the U.S. Food and Drug Administration. He described those changes to lines in the bill and the amendment as central to the measure’s operation.

“Our main S of the bill… applies to the tax on modified risk products so they can be brought to market in the state of Louisiana,” Reiser said, adding the tax structure is required by the state’s master tobacco settlement if a new product is sold here.

Nut graf: The committee’s final vote sent HB 669 forward with the amendment that creates reduced tax rates keyed to FDA designations for MRTPs, but members defeated a later motion to strip the reduced‑rate language. The hearing featured lengthy testimony from industry and health groups about safety claims, youth access, and practical issues like tax stamping and administration.

Industry witnesses argued reduced rates could encourage current cigarette smokers to switch to less harmful alternatives. Alexandra Wick of Philip Morris International, the product’s U.S. manufacturer, said the company’s FDA review showed that heating—not burning—tobacco lowers the level of combustion‑related chemicals. “By heating the tobacco but not burning it you reduce the harmful and potentially harmful toxic chemicals that are the carcinogens,” she said, adding the company’s studies showed roughly a 95% average reduction for certain measured chemicals.

Public health groups opposed the rate reductions and urged caution. American Heart Association representative Erica Williams told the committee, “Why lower it and make it more available for our children?” The American Lung Association’s Eric Weinstein said in testimony: “This is a cigarette. It uses whole tobacco leafs. It is rolled in paper and the only difference between it and a traditional cigarette is the fact that it is heated and not burned.” Public comment also raised operational questions: wholesalers said special stamps and new stamping equipment may be required if MRTPs are taxed differently.

Committee action and votes - Adopted (by voice) an amendment offered early in the hearing (amendment set 02/1966) that carved out reduced rates tied to FDA designations; the committee record shows the amendment was adopted by unanimous consent at that moment. - Representative Willard later offered an amendment in concept to remove the reduced‑rate language from the bill. That motion drew an objection and proceeded to a roll‑call vote; the committee rejected the motion to remove the reduced rates (6 in favor; 8 opposed; motion failed). - Final disposition: a motion to report HB 669 as amended carried on a roll‑call vote (8 yes; 3 no). The committee therefore sent the bill forward with the reduced‑rate structure intact.

Discussion and other details - Rates: Witnesses and members discussed the relationship of the proposed reduced rate to the cigarette excise tax. Representative Reiser said other states use formulas that result in percentage reductions off the cigarette tax; in testimony committee members referred to cigarette tax rates of roughly $1.08 per pack and to reductions used by other states. The adopted amendment set differing reductions tied to the FDA MRTP classification (as described in the bill language presented). - Administration: The Louisiana Association of Wholesalers said the physical stamp process may require new equipment or stamps to mark products with a reduced‑rate designation. Department of Revenue staff and wholesalers discussed whether existing stamping hardware can handle differently sized consumable units. - Youth access and public health: Opponents argued that a lower tax would make the products more affordable and attractive to minors and could perpetuate dual use with cigarettes. Industry witnesses pointed to FDA authorization and international market experience in Japan and Europe where manufacturer and FDA‑level reviews played a role.

Ending: The bill now moves to the next stage of the legislative process with language that permits reduced taxes for FDA‑designated MRTPs; lawmakers and staff will continue to consider administrative details, enforcement and safeguards for youth access as the measure advances.