At the end of each year, our policy analysts share insights on the issues that have been at the forefront of state legislatures throughout the session during their review of thousands of bills across all 50 states. Here are the big developments and high-level trends we saw last year in the tobacco and marijuana space, plus what you can expect in 2025. 

Tobacco Policy: 2024 State Legislative Recap

Tobacco remains a popular source of revenue for state legislatures, and tax bills remained popular in 2024. But while state governments remain reliant to tobacco taxes for funding programs, they also focused on several health-related issues in 2024

Excise Tax Rates

Tax increases on tobacco products were enacted in several states in 2024. Maryland increased taxes on cigarettes, Other Tobacco Products (OTP), and vapor products. Rhode Island increased taxes on cigarettes and imposed new taxes on vapor products. Mississippi and Virginia imposed new taxes on vapor products. 

At least 12 other states sought to increase state cigarette excise taxes in 2024: Georgia, Hawaii, Iowa, Massachusetts, Michigan, Mississippi, Missouri, Nebraska, New Hampshire, New Jersey, New York, Tennessee. One state, Oklahoma, stands out as legislators introduced a bill lowering tobacco tax rates. Vapor tax increases were proposed in 14 states: Alaska, Alabama, Arizona, Georgia, Hawaii, Iowa, Michigan, Nebraska, New Mexico, New York, Oklahoma, Tennessee, West Virginia, Wisconsin.

Cigar tax increases were proposed in four states: Maine, Massachusetts, Mississippi, and Nebraska, while legislators in two states, New York and Wisconsin, introduced bills seeking tax parity in the rates on little cigars and cigarettes. OTP tax increases were proposed in at least five more states: Massachusetts, Michigan, Mississippi, New York, Tennessee.

Cigar Tax Caps

As tax rates on tobacco products continue to increase, there has been a push to limit the taxes imposed on what are referred to as premium cigars. These products are generally taxed on a percentage basis, so the tax on one premium cigar can be quite prohibitive. These high tax rates have driven many customers to purchase cigars over the internet to avoid taxes. In an effort to keep local cigar sales competitive with online sales, several states have considered legislation to cap the tax on an individual cigar at a set maximum. Tax cap bills were introduced in 2024in at least five states, with the majority capping the maximum tax on a premium cigar at $0.50 (See NE LB 251 as an example).

Flavor Bans

In 2009, following passage of the Tobacco Control Act, the US FDA banned flavored cigarettes, finding that flavored cigarettes largely appealed to underage smokers. The FDA allowed menthol cigarettes to remain legal at the time, until 2021, when the agency agreed to promulgate rules making menthol cigarettes illegal as well. In the three years since that announcement, those rules have not been finalized, and earlier in 2024the Agency delayed a final decision until after the November election. And while flavored cigarettes are largely banned, flavored vapor products have proliferated.

In the absence of federal action, several states have taken action on flavored tobacco products. Massachusetts legislators banned the sale of all flavored tobacco products in 2019. California followed suit in 2022. New Jersey and New York have banned all flavored vape products, while three other states have banned non-menthol flavored vape products. Legislative action has continued in 2024, with at least 18 states considering bills impacting flavored tobacco or vapor products. California enacted a pair of bills designed to improve enforcement of its existing bans. CA AB 3218 establishes a list of all tobacco products that are permissibly unflavored and therefore allowed to be sold in California, while CA SB 1230 allows the state Department of Tax and Fee Administration to seize and destroy illegal flavored tobacco products. The Rhode Island budget bill codified a 2019 executive order that banned flavored vapor products, and Utah banned all flavored vapor products other than tobacco and menthol.

Vapor Product Directories

A category of tobacco legislation that exploded in 2024 concerns vapor product directories (or Premarket Tobacco Product Application (PMTA)). These bills restrict sales of vapor products to those that have been approved for sale by the FDA after submitting a PMTA. However, the FDA has only authorized about two dozen such products through the PMTA process, so these bills have the potential to prohibit the sales of most vapor products. Vapor product directory bills generally create state-maintained lists of allowed products. Manufacturers would have to provide proof of FDA approval or proof that a PMTA is pending.

Prior to 2024, only three states (Alabama, Louisiana, and Oklahoma) had enacted directory laws. In 2024, nearly 30 states considered directory bills, and Florida, Iowa, Kentucky, Nebraska, North Carolina, and Virginia all enacted legislation creating some sort of product directory.

2025 Tobacco Policy Outlook

Many of the issues that were priorities in 2024 are expected to remain so in 2025. States have always looked to tobacco excise taxes as both a revenue source and a deterrent. With the lack of progress on federal action concerning flavored tobacco products, states will continue to look at limiting such products and keeping them out of the hands of minors. And more states are expected to look to vapor product directories as a way to limit the number of vapor products in the market.

As for emerging issues, nicotine pouches have exploded on the market in recent years. These pouches, similar in appearance to smokeless tobacco pouches, offer nicotine without combustion and can be used in a more discrete manner than vapor products. They are offered in a variety of flavors, which enhance their appeal to youth users. The FDA does have regulatory authority over the pouches, as manufacturers must apply for a marketing authorization to sell the products. But as the FDA continues to slow-walk approval of vapor products and nicotine pouches, states will likely seek to fill the void as they have with other issues.

Marijuana Policy: 2024 State Legislative Recap

It’s been 28 years since California became the first state to legalize medical marijuana and 12 years since Colorado and Washington became the first to legalize recreational marijuana. Since then, a total of 38 states and DC have legalized medical marijuana while 24 states and DC have legalized marijuana for recreational purposes. Though nearly half of the country has access to some form of marijuana, many states are still battling over the future of legalization in legislative chambers and through ballot measures.

During the 2023-2024 legislative session, over 100 bills in 20 states and DC were introduced that would have either legalized medical/recreational marijuana or put forth a question to the voters to decide whether it should be made legal. However, in 2024, none of these bills were signed into law (though a handful are still active in the states).

For the past five years, legislators in Pennsylvania have tried and failed to legalize marijuana for recreational use. Proponents hope that in the 2024 bill, PA HB 2500, can be the breakthrough. If enacted, the bill would legalize recreational marijuana for adults 21+ and regulate industry practices. Introduced in mid-September, the measure is sponsored by Representative Aaron Kaufer (R) and currently has 17 Democratic co-sponsors. As of publication, the bill has not moved since being referred to the Health Committee in September.

New Hampshire is currently the only state in New England that has not legalized recreational marijuana. Legislators attempted to enact recreational legalization legislation during the regular session but were unsuccessful. Though the legislature is not currently in session, meetings are ongoing this fall to discuss adopting a recreational marijuana bill. 

Finally, both Congresswoman Nancy Mace (R-SC) and Senator Cory Booker (D-NJ) introduced federal legislation aimed at decriminalizing and descheduling marijuana. Mace, an outspoken advocate for marijuana legalization, introduced her bill last October with the latest action occurring back in January. Booker’s bill was introduced this May but has not seen much movement since. With the election rapidly approaching, it is unlikely either of these bills will be pushed forward.

Marijuana Policy Ballot Measures in 2024

Though no state legislatures enacted legislation to legalize marijuana in 2024, voters in four states – Florida, Nebraska, North Dakota, and South Dakota – had the opportunity to do so via ballot measure during the 2024 elections: Florida, Nebraska, North Dakota, and South Dakota. The Florida, North Dakota, and South Dakota measures failed, while the Nebraska measures were passed.

2025 Marijuana Policy Outlook

We can expect marijuana legalization to once again be a hot issue in 2025, especially in those states that had 2024 ballot measures.

North Carolina will be a state to watch. State legislators have introduced and eventually killed numerous bills over the past 5 years that would have legalized either medical or recreational marijuana, including a handful of bills during the 2023/2024 session. Though efforts for legalization have failed in recent years, the Eastern Band of Cherokee Indians (EBCI) opened their first legal recreational marijuana establishment in early September while medical sales began in April. Currently, anyone over the age of 21 with a valid ID is able to purchase marijuana through EBCI establishments. With sales on tribal lands underway, expect state legislators to revisit this issue in 2025

As public support for both medical and recreational marijuana continues to climb, states without legalization measures in place, as well as federal legislators, will continue to face mounting pressure from the public to enact legalization legislation.