Alabama Vapers Hit With New Local Taxes Ahead of Statewide Levy
Vapers across Alabama are about to feel the pinch in their wallets as new local taxes on e-liquids and vaping products roll out this week. Cities and towns have been rushing to push these measures through before a looming state deadline shuts the door on new local vape taxes.
Back in May, the Alabama Legislature approved HB 529, a bill that sets a statewide $0.10 per milliliter wholesale tax on all e-liquids, with or without nicotine, starting in October 2026. The new law also locks down the ability of local governments to add their own taxes after October 1, 2025.
The bill states:
Any local tax passed before Oct. 1, 2025, will remain in place. But once that date hits, no new local taxes on vapor products can be created.
That language has sent local officials scrambling. Wanting to secure their own slice of tax revenue, municipalities across the state have been racing against the clock to enact vape taxes before the cutoff.
While the state tax will eventually funnel a portion of revenue back to counties and cities (25 percent each, divided by population), some local leaders have calculated that their payout under the statewide formula won’t match what they could pull in by taxing directly.
The result? Small businesses will be squeezed from both ends—paying local excise taxes now and facing the additional state tax in 2026. That burden will almost certainly be passed on to consumers, driving up the cost of vaping products.
Of course, there’s a catch for local governments: once a city or county enacts its own vape tax, it won’t be eligible to receive any of the revenue from the state’s tax once it takes effect. That tradeoff could create long-term tension between local and state funding streams.
For vapers, the impact is immediate. Just like with cigarette taxes, consumers often sidestep local hikes by shopping in nearby towns without a tax or ordering online. That means brick-and-mortar vape shops in taxed areas could see sales drop as customers look elsewhere.
Some municipalities have gone all in with their own $0.10 per milliliter tax, while others have opted for lower rates. But no matter the figure, the statewide tax is still coming in 2026—and it will stack on top of any local levies.
So far, cities like Chelsea, Decatur, Dothan, Fairhope, Foley, Gulf Shores, Muscle Shoals, Orange Beach, and Spanish Fort have adopted new vape taxes. Meanwhile, Mobile—the state’s second-largest city—was set to debate its own ordinance this week, according to local news reports.
Alabama isn’t alone in its push. It’s now one of at least six states this year to pass or expand vape taxes, signaling a growing national trend toward heavier regulation and higher costs for adult vapers.
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