LETTER: Business revenues going up in smoke

Published 1:30 pm Saturday, June 13, 2026

Our governor should take a hard look at the unintended consequences of massive new taxes on vapor products and nicotine pouches included in Senate Bill 24. Even though it’s framed as a revenue generator, small businesses like mine and our customers are the ones who will feel the impact the most.

Under the proposed tax structure, consumers could see prices jump dramatically by as much as 118% for vapor products and 75% for nicotine pouches. These aren’t minor cost increases. They are steep hikes that will hit consumers’ wallets the most.

And the ripple effects are significant. Vapor product sales are projected to fall by 83%, wiping out nearly $10 million in revenue from small retailers. Nicotine pouch sales are expected to decline by 30%, dropping by another nearly $12 million. That’s close to $22 million in lost sales flowing out of local businesses, many of them already operating on thin margins.

Meanwhile, the state stands to gain nearly $19 million in new tax revenue, $4.9 million from vapor products and $13.7 million from nicotine pouches. This comes at a time when Alaska has a budget surplus because of higher oil prices.

As we have seen around the country, when taxes go up, responsible retailers lose. That’s because working-class adult smokers looking to switch from cigarettes turn to the illicit market. This illicit market is filled by Chinese manufacturers and rogue smoke shops who are flooding the country with unregulated products with very high nicotine counts and dubious health claims.

In other words, with Senate Bill 24, the Chinese-backed illicit market wins and Alaska small businesses and our working class lose.

I urge Governor Dunleavy to veto Senate Bill 24.

Walt Sendor is a category manager at Rebel Convenience Stores, which has more than 30 stores around Alaska.