SSB 3145 (LSB 6698XC (3) 91)

SENATE FILE _____ 

BY  (PROPOSED COMMITTEE ON HEALTH AND HUMAN SERVICES BILL BY CHAIRPERSON WARME)

A BILL FOR

An Act relating to the taxation of cigarettes, tobacco products, vapor products, and consumable hemp products, and making appropriations to the department of health and human services and the department of justice.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

DIVISION I
CIGARETTE TAXATION

    Section 1.  Section 453A.6, subsection 1, Code 2026, is amended to read as follows:
   1.  There is imposed, and shall be collected and paid to the department, a tax on all cigarettes used or otherwise disposed of in this state for any purpose equal to six ten and eight-tenths five hundredths cents on each cigarette.
    Sec. 2.  Section 453A.6, subsection 8, paragraph a, Code 2026, is amended to read as follows:
   a.  Pay directly to the department, in lieu of the tax under subsection 1, a tax equal to three four and six fifty-two hundredths cents on each cigarette dispensed from such machine. Payments made under this paragraph shall be remitted to the department electronically.
DIVISION II
TAX ON TOBACCO PRODUCTS

    Sec. 3.  Section 453A.43, Code 2026, is amended to read as follows:
   453A.43  Tax on tobacco products.
   1.  a.  A tax is imposed upon all tobacco products in this state and upon any person engaged in business as a distributor of tobacco products, at the rate of twenty-two fifty-five percent of the wholesale sales price of the tobacco products, except little cigars and snuff as defined in section 453A.42.  Notwithstanding the rate of tax imposed under this paragraph “a” on tobacco products, little cigars shall be subject to the tax as specified pursuant to paragraph “c”, and snuff shall be subject to the tax as specified in paragraph “d”.
   b.  In addition to the tax imposed under paragraph “a”, a tax is imposed upon all tobacco products in this state and upon any person engaged in business as a distributor of tobacco products, at the rate of twenty-eight percent of the wholesale sales price of the tobacco products, except little cigars and snuff as defined in section 453A.42.
   c.  b.  Notwithstanding the rate of tax imposed pursuant to paragraphs paragraph “a” and “b”, if the tobacco product is a cigar, the total amount of the tax imposed pursuant to paragraphs paragraph “a” and “b” combined shall not exceed fifty fifty-five cents per cigar.
   d.  c.  Little cigars shall be subject to the same rate of tax imposed upon cigarettes in section 453A.6, payable at the time and in the manner provided in section 453A.6; and stamps shall be affixed as provided in subchapter I of this chapter.
   d.  Snuff shall be subject to the tax as provided in subsections 3 and 4.
   e.  The taxes on tobacco products, excluding little cigars and snuff, shall be imposed at the time the distributor does any of the following:
   (1)  Brings, or causes to be brought, into this state from outside the state tobacco products for sale.
   (2)  Makes, manufactures, or fabricates tobacco products in this state for sale in this state.
   (3)  Ships or transports tobacco products to retailers in this state, to be sold by those retailers.
   2.  a.  A tax is imposed upon the use or storage by consumers of tobacco products in this state, and upon the consumers, at the rate of twenty-two fifty-five percent of the cost of the tobacco products.
   b.  In addition to the tax imposed in paragraph “a”, a tax is imposed upon the use or storage by consumers of tobacco products in this state, and upon the consumers, at a rate of twenty-eight percent of the cost of the tobacco products.
   c.  b.  Notwithstanding the rate of tax imposed pursuant to paragraphs paragraph “a” and “b”, if the tobacco product is a cigar, the total amount of the tax imposed pursuant to paragraphs paragraph “a” and “b” combined shall not exceed fifty fifty-five cents per cigar.
   d.  c.  The taxes imposed by this subsection shall not apply if the taxes imposed by subsection 1 on the tobacco products have been paid.
   e.  d.  The taxes imposed under this subsection shall not apply to the use or storage of tobacco products in quantities of:
   (1)  Less than twenty-five cigars.
   (2)  Less than one pound smoking or chewing tobacco or other tobacco products not specifically mentioned herein in this chapter, in the possession of any one consumer.
   3.  A tax is imposed upon all snuff in this state and upon any person engaged in business as a distributor of snuff at the rate of one dollar and nineteen cents per ounce, with a proportionate tax at the same rate on all fractional parts of an ounce of snuff fifty-five percent of the wholesale sales price. The tax shall be computed based on the net weight listed by the manufacturer. The tax on snuff shall be imposed at the time the distributor does any of the following:
   a.  Brings or causes to be brought into this state from outside the state, snuff for sale.
   b.  Makes, manufactures, or fabricates snuff in this state for sale in this state.
   c.  Ships or transports snuff to retailers in this state, to be sold by those retailers.
   4.  a.  A tax is imposed upon the use or storage by consumers of snuff in this state, and upon the consumers, at the rate of one dollar and nineteen cents per ounce with a proportionate tax at the same rate on all fractional parts of an ounce of snuff fifty-five percent of the wholesale sales price. The tax shall be computed based on the net weight as listed by the manufacturer.
   b.  The tax imposed by this subsection shall not apply if the tax imposed by subsection 3 on snuff has been paid.
   c.  The tax shall not apply to the use or storage of snuff in quantities of less than ten ounces.
   5.  Any tobacco product with respect to which a tax has once been imposed under this subchapter shall not again be subject to tax under this subchapter, except as provided in section 453A.40.
   6.  The tax imposed by this section shall not apply with respect to any tobacco product which under the Constitution and laws of the United States may not be made the subject of taxation by this state.
   7.  The tax imposed by this section shall be in addition to all other occupation or privilege taxes or license fees now or hereafter imposed by any city or county.
   8.  All excise taxes collected under this chapter by a distributor or any individual are deemed to be held in trust for the state of Iowa.
DIVISION III
EXCISE TAX ON VAPOR PRODUCTS

    Sec. 4.  Section 331.303, subsection 3, Code 2026, is amended to read as follows:
   3.  Act upon applications for cigarette, tobacco product, and vapor product tax permits in accordance with chapter 453A.
    Sec. 5.  Section 331.653, subsection 11, Code 2026, is amended to read as follows:
   11.  Carry out duties relating to the seizure and forfeiture of cigarettes, tobacco products, and vapor products, vehicles, and other property used in violation of cigarette, tobacco product, and vapor product tax laws as provided in section 453A.32.
    Sec. 6.  Section 331.756, subsection 19, Code 2026, is amended to read as follows:
   19.  Assist, at the request of the director of revenue, in the enforcement of cigar and cigarette, tobacco product, and vapor product tax laws as provided in sections 453A.32 and 453A.49.
    Sec. 7.  Section 453A.1, subsection 21, Code 2026, is amended to read as follows:
   21.  “Place of business” is construed to mean and include any place where cigarettes, tobacco products, or vapor products are sold or where cigarettes, tobacco products, or vapor products are stored within or without the state of Iowa by the holder of an Iowa permit or kept for the purpose of sale or consumption; or if sold from any vehicle or train, the vehicle or train on which or from which such cigarettes, tobacco products, or vapor products are sold shall constitute a place of business; or for a business within or without the state that conducts delivery sales, any place where alternative nicotine products or vapor products are sold or where alternative nicotine products or vapor products are kept for the purpose of sale.
    Sec. 8.  Section 453A.15, subsections 1, 2, and 4, Code 2026, are amended to read as follows:
   1.  The director may prescribe the forms necessary for the efficient administration of this subchapter and may require uniform books and records to be used and kept by each permit holder or other person as deemed necessary. The director may also require each permit holder or other person to keep and retain in the director’s possession evidence on prescribed forms of all transactions involving the purchase and sale of cigarettes, tobacco products, or vapor products, or the purchase and use of stamps. The evidence shall be kept for a period of three years from the date of each transaction, for the inspection at all times by the department.
   2.  Where a state permit holder sells cigarettes, tobacco products, or vapor products at retail, the holder shall be required to maintain detailed records for sales of cigarettes, tobacco products, or vapor products to be sold at retail and the cigarette such sales records shall be kept separate and apart.
   4.  Every permit holder or other person shall, when requested by the department, make additional reports as the department deems necessary and proper and shall at the request of the department furnish full and complete information pertaining to any transaction of the permit holder or other person involving the purchase or sale or use of cigarettes, tobacco products, or vapor products, or purchase of cigarette stamps.
    Sec. 9.  Section 453A.24, Code 2026, is amended to read as follows:
   453A.24  Carrier to permit access to records.
   1.  Every common carrier or person in this state having custody of books or records showing the transportation of cigarettes, tobacco products, or vapor products, both interstate and intrastate, shall give and allow the department free access to those books and records.
   2.  The director may require by rule that common carriers or the appropriate persons provide monthly reports to the department detailing all information the department deems necessary on shipments into and out of Iowa of cigarettes, and tobacco products, alternative nicotine products, or vapor products as set forth in this subchapter I and subchapter II of this chapter. A report required to be submitted by the director pursuant to this section shall be filed electronically.
    Sec. 10.  Section 453A.32, subsection 6, Code 2026, is amended to read as follows:
   6.  The provisions of this section applying to cigarettes shall also apply to tobacco products, alternative nicotine products, and vapor products taxed under subchapter II of this chapter.
    Sec. 11.  Section 453A.33, Code 2026, is amended to read as follows:
   453A.33  Seizure not to affect criminal prosecution.
   The seizure, forfeiture, and sale of cigarettes, tobacco products, alternative nicotine products, vapor products, and other property under the terms and conditions set out in section 453A.32, shall not constitute any defense to the person owning or having control or possession of the property from criminal prosecution for any act or omission made or offense committed under this chapter or from liability to pay penalties provided by this chapter.
    Sec. 12.  Section 453A.35, subsection 1, paragraph b, Code 2026, is amended to read as follows:
   b.  The revenues generated from the tax on consumable hemp products as specified in section 453F.2, from the tax on cigarettes pursuant to section 453A.6, subsection 1 subsections 1 and 8, from the tax on tobacco products as specified in section 453A.43, subsections 1, 2, 3, and 4, from the tax on vapor products as specified in section 453A.47D, and from the fees and penalties specified in subchapter III shall be credited to the health care trust fund created in section 453A.35A.
    Sec. 13.  Section 453A.35A, subsection 1, Code 2026, is amended to read as follows:
   1.  A health care trust fund is created in the office of the treasurer of state. The fund consists of the revenues generated from the tax on consumable hemp products as specified in section 453F.2, from the tax on cigarettes pursuant to section 453A.6, subsection 1 subsections 1 and 8, from the tax on tobacco products as specified in section 453A.43, subsections 1, 2, 3, and 4, from the tax on vapor products as specified in section 453A.47D, and from the fees and penalties specified in subchapter III, that are credited to the health care trust fund, annually, pursuant to section 453A.35. Moneys in the fund shall be separate from the general fund of the state and shall not be considered part of the general fund of the state. Moneys Except as otherwise provided, moneys in the fund shall be used only as specified in this section and shall be appropriated only for the uses specified. Moneys in the fund are not subject to section 8.33 and shall not be transferred, used, obligated, appropriated, or otherwise encumbered, except as provided in this section. Notwithstanding section 12C.7, subsection 2, interest or earnings on moneys deposited in the fund shall be credited to the fund.
    Sec. 14.  Section 453A.39, subsection 1, Code 2026, is amended to read as follows:
   1.  A manufacturer, distributor, wholesaler, retailer, or distributing agent, or an agent thereof of a manufacturer, distributor, wholesaler, retailer, or distributing agent, shall not give away cigarettes, or tobacco products, or vapor products at any time in connection with the manufacturer’s, distributor’s, wholesaler’s, retailer’s, or distributing agent’s business or for promotion of the business or product, except as provided in subsection 2.
    Sec. 15.  Section 453A.40, subsections 1 and 3, Code 2026, are amended to read as follows:
   1.  All persons required to obtain a permit or to be licensed under section 453A.13 or section 453A.44 having in their possession and held for resale on the effective date of an increase in the tax rate cigarettes, little cigars, or tobacco products, or vapor products upon which the tax under section 453A.6, or 453A.43, or 453A.47D has been paid, unused cigarette tax stamps which have been paid for under section 453A.8, unused metered imprints which have been paid for under section 453A.12, or tobacco products for which the tax has not been paid under section 453A.46 shall be subject to an inventory tax on the items as provided in this section.
   3.  The rate of the inventory tax on each item subject to the tax as specified in subsection 1 is equal to the difference between the amount paid on each item under section 453A.6, 453A.8, 453A.12, or 453A.43, or 453A.47D prior to the tax increase and the amount that is to be paid on each similar item under section 453A.6, 453A.8, 453A.12, or 453A.43, or 453A.47D after the tax increase except that in computing the rate of the inventory tax any discount allowed or allowable under section 453A.8 shall not be considered.
    Sec. 16.  Section 453A.42, subsections 1, 2, 8, 9, 10, 12, 14, and 17, Code 2026, are amended to read as follows:
   1.  “Business” means any trade, occupation, activity, or enterprise engaged in for the purpose of selling or distributing tobacco products or vapor products in this state.
   2.  “Consumer” means any person who has title to or possession of tobacco products or vapor products in storage, for use or other consumption in this state.
   8.  “Person” means any individual, firm, association, partnership, joint stock company, joint adventure venture, corporation, trustee, agency, or receiver, or any legal representative of any of the foregoing individual, firm, association, partnership, joint stock company, joint venture, corporation, trustee, agency, or receiver.
   9.  “Place of business” means any place where tobacco products are sold or where tobacco products or vapor products are manufactured, stored, or kept for the purpose of sale or consumption, including any vessel, vehicle, airplane, train, or vending machine; or for a business within or without the state that conducts delivery sales, any place where alternative nicotine products or vapor products are sold or where alternative nicotine products or vapor products are kept for the purpose of sale, including delivery sales.
   10.  “Retail outlet” means each place of business from which tobacco products or vapor products are sold to consumers.
   12.  “Sale” means any transfer, exchange, or barter, in any manner or by any means whatsoever, for a consideration, and includes and means all sales made by any person. It includes a gift by a person engaged in the business of selling tobacco products or vapor products, for advertising, as a means of evading the provisions of this subchapter, or for any other purposes whatsoever.
   14.  “Storage” means any keeping or retention of tobacco products or vapor products for use or consumption in this state.
   17.  “Use” means the exercise of any right or power incidental to the ownership of tobacco products or vapor products.
    Sec. 17.  Section 453A.42, Code 2026, is amended by adding the following new subsection:
   NEW SUBSECTION.  10A.  “Retail sales price” means the same as “sales price” as defined in section 423.1.
    Sec. 18.  Section 453A.45, subsection 3, Code 2026, is amended to read as follows:
   3.  Every retailer and subjobber shall procure itemized invoices of all tobacco products and vapor products purchased. The invoices shall show the name and address of the seller and the date of purchase. The retailer and subjobber shall preserve a legible copy of each invoice for three years from the date of purchase. Invoices shall be available for inspection by the director or the director’s authorized agents or employees at the retailer’s or subjobber’s place of business.
    Sec. 19.  NEW SECTION.  453A.47D  Excise tax on vapor products.
   1.  An excise tax at a rate of fifteen percent is imposed on the retail sales price from the retail sale of, including a delivery sale, of a vapor product. The amount of tax shall be added to the retail sales price at the point of sale to the consumer and shall be collected from the consumer.
   2.  The tax imposed by this section shall not apply with respect to any vapor product which under the Constitution and laws of the United States may not be made the subject of taxation by this state.
   3.  The director shall administer the excise tax imposed under this section as nearly as possible in conjunction with the administration of the state sales and use tax law, except that portion of the law that implements the streamlined sales and use tax agreement. The director shall provide appropriate forms, or provide on the regular state tax forms, for reporting vapor product excise tax liability, and for ease of administration may require vapor product excise tax liability to be identified, reported, and remitted to the department as sales and use tax liability, provided the department has the ability to properly identify such amounts as vapor product excise tax revenues upon receipt.
   4.  The director may require all persons who are engaged in the business of deriving any sales price or purchase price subject to tax under this section to register with the department. The director may also require a tax permit applicable only to this section for any vapor product retailer not collecting, or any vapor product user not paying, taxes under chapter 423.
   5.  Section 422.25, subsection 4, sections 422.30, 422.67, and 422.68, section 422.69, subsection 1, sections 422.70, 422.71, 422.72, 422.74, and 422.75, section 423.14, subsection 1, and sections 423.23, 423.24, 423.25, 423.31 through 423.35, 423.37, 423.39 through 423.42, and 423.47, consistent with the provisions of this chapter, shall apply with respect to the tax authorized under this section in the same manner and with the same effect as if the excise taxes on the sale of vapor products were retail sales taxes within the meaning of those statutes. Notwithstanding this subsection, the director shall provide for monthly filing of returns and for other than monthly filing of returns both as prescribed in section 423.31.
   6.  The tax imposed by this section shall be in addition to any other taxes imposed by law.
   7.  All excise taxes collected under this section by any person are deemed to be held in trust for the state of Iowa.
   8.  The department shall adopt rules pursuant to chapter 17A to administer this section.
    Sec. 20.  Section 453A.51, Code 2026, is amended to read as follows:
   453A.51  Assessment of cost of audit.
   The department may employ auditors or other persons to audit and examine the books and records of a permit holder or other person dealing in tobacco products and vapor products to ascertain whether the permit holder or other person has paid the amount of the taxes required to be paid by the permit holder or other person under the provisions of this chapter. If the taxes have not been paid, as required, the department shall assess against the permit holder or other person, as additional penalty, the reasonable expenses and costs of the investigation and audit.
DIVISION IV
EXCISE TAX ON CONSUMABLE HEMP

    Sec. 21.  Section 204.7, subsection 4, Code 2026, is amended to read as follows:
   4.  A person selling a consumable hemp product in this state shall register with the department of health and human services on a form prescribed by the department of health and human services by rule and shall keep on the premises of the person’s business a copy of the certificate of analysis issued pursuant to section 204.8 for the hemp contained in the consumable hemp products sold by the person. The department of health and human services may impose a fee, established by the department of health and human services by rule, on a registrant not to exceed the cost of processing the registration.  The department of health and human services shall provide the names of persons registering to sell consumable hemp products to the department of revenue for the purpose of collecting the excise tax in section 453F.2. The department of health and human services shall adopt rules for the revocation of a registration issued to a person who sells a consumable hemp product not in compliance with this section.
    Sec. 22.  NEW SECTION.  453F.1  Definitions.
   As used in this chapter:
   1.  “Consumable hemp product” means the same as defined in section 204.2.
   2.  “Delivery sale” means any sale of a consumable hemp product to a purchaser in this state where the purchaser submits the order for such sale by means of a telephonic or other method of voice transmission, mail or any other delivery service, or the internet or other online service and the consumable hemp product is delivered by use of mail or a delivery service. The sale of consumable hemp product shall constitute a delivery sale regardless of whether the seller is located in this state. “Delivery sale” does not include a sale to a distributor or retailer of any consumable hemp product not for personal consumption.
   3.  “Department” means the department of revenue.
   4.  “Director” means the director of revenue.
   5.  “Retail sales price” means the same as “sales price” as defined in section 423.1.
    Sec. 23.  NEW SECTION.  453F.2  Excise tax —— rules.
   1.  An excise tax at a rate of fifteen percent is imposed on the retail sales price from the retail sale, including a delivery sale, of a consumable hemp product. The amount of the tax shall be added to the retail sales price at the point of sale to the consumer and shall be collected from the consumer.
   2.  a.  An excise tax at a rate of fifteen percent is imposed upon the use and storage by a consumer of a consumable hemp product in this state at a rate of fifteen percent of the cost of the consumable hemp product.
   b.  The taxes imposed pursuant to this subsection shall not apply if the taxes imposed by subsection 1 on the consumable hemp product have been paid.
   3.  The director shall administer the excise tax imposed under this section as nearly as possible in conjunction with the administration of the state sales and use tax law, except that portion of the law that implements the streamlined sales and use tax agreement. The director shall provide appropriate forms, or provide on the regular state tax forms, for reporting consumable hemp product excise tax liability, and for ease of administration may require consumable hemp product excise tax liability to be identified, reported, and remitted to the department as sales and use tax liability, provided the department has the ability to properly identify such amounts as consumable hemp product excise tax revenues upon receipt.
   4.  The director may require all persons who are engaged in the business of deriving any sales price or purchase price subject to tax under this chapter to register with the department. The director may also require a tax permit applicable only to this section for any consumable hemp product retailer not collecting, or any consumable hemp product user not paying, taxes under chapter 423.
   5.  Section 422.25, subsection 4, sections 422.30, 422.67, and 422.68, section 422.69, subsection 1, sections 422.70, 422.71, 422.72, 422.74, and 422.75, section 423.14, subsection 1, and sections 423.23, 423.24, 423.25, 423.31 through 423.35, 423.37, 423.39 through 423.42, and 423.47, consistent with the provisions of this chapter, shall apply with respect to the tax authorized under this section in the same manner and with the same effect as if the excise taxes on the sale of consumable hemp products were retail sales taxes within the meaning of those statutes. Notwithstanding this subsection, the director shall provide for monthly filing of returns and for other than monthly filing of returns both as prescribed in section 423.31.
   6.  The tax imposed by this section shall not apply with respect to any consumable hemp product which under the Constitution and laws of the United States may not be made the subject of taxation by this state.
   7.  The tax imposed by this section shall be in addition to any other taxes imposed by law.
   8.  All excise taxes collected under this section by any person are deemed to be held in trust for the state of Iowa and shall be credited to the health care trust fund created in section 453A.35A.
   9.  The department shall adopt rules pursuant to chapter 17A to administer this chapter.
DIVISION V
APPROPRIATIONS

    Sec. 24.  DEPARTMENT OF HEALTH AND HUMAN SERVICES —— DOUBLE UP FOOD BUCKS PROGRAM —— APPROPRIATION.  There is appropriated from the health care trust fund created in section 453A.35A to the department of health and human services for the fiscal year beginning July 1, 2026, and ending June 30, 2027, in addition to any other funding appropriated for such purpose for the same fiscal year, the following amount, or so much thereof as is necessary, to be used for the purposes designated:
   ...................................................................... $  1,000,000

   The appropriation made in this section shall be used to provide a grant to the Iowa healthiest state initiative to support the double up food bucks program to make fresh fruits and vegetables sold at farmers markets, grocery stores, and other participating locations accessible to individuals and families who reside in this state and receive assistance through the federal supplemental nutrition assistance program.
    Sec. 25.  DEPARTMENT OF JUSTICE —— HUMAN TRAFFICKING —— APPROPRIATION.  There is appropriated from the health care trust fund created in section 453A.35A to the department of justice for the fiscal year beginning July 1, 2026, and ending June 30, 2027, in addition to any other funding appropriated for such purpose for the same fiscal year, the following amount, or so much thereof as is necessary, to be used for the purposes designated:
   ...................................................................... $  1,000,000

   The appropriation made in this section shall be used to provide grants to care providers providing services to victims of human trafficking.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to the taxation of cigarettes, tobacco products, vapor products, and consumable hemp products, and makes appropriations to the department of health and human services and the department of justice.
   DIVISION I —— CIGARETTE TAXATION. The bill raises the cigarette tax from 6.8 cents per cigarette to 10.05 cents per cigarette. The overall tax on a pack of cigarettes (20 cigarettes) goes from $1.36 to $2.01.
   The bill also raises the tax on loose tobacco products inserted into a vending machine from which assembled cigarettes are dispensed. The tax is increased from 3.06 cents on each cigarette dispensed from the vending machine to 4.52 cents.
   By increasing the cigarette tax in the bill, the inventory tax is also assessed on cigarettes remaining in inventories taxed under the previous tax rate that is equal to the difference between the previous tax rate and the new tax rate.
   Code section 453A.35 specifies that revenues from the tax on cigarettes are deposited into the health care trust fund created in Code section 453A.35A.
   DIVISION II —— TAX ON TOBACCO PRODUCTS. Currently, a tax is imposed on the distributor of all tobacco products (excluding cigarettes, little cigars, and snuff) at a rate of 22 percent of the wholesale sales price under Code section 453A.43(1)(a) and at a rate of 28 percent under Code section 453A.43(1)(b) for a combined rate of 50 percent tax on the wholesale sales price. The bill combines the 22 percent rate and the 28 percent rate and raises the tax on tobacco products from the combined rate of 50 percent to 55 percent of the wholesale sales price.
   Currently, the tax on cigars is capped at 50 cents per cigar. The bill raises the cap on the tax on cigars to 55 cents to match the percentage increase of the other tax increases within Code section 453A.43(1).
   The bill changes the tax on snuff to match the tax on other tobacco products within Code section 453A.43(1) by taxing snuff at 55 percent of the wholesale price rather than taxing snuff at a rate of $1.19 per ounce.
   By increasing the tax on the wholesale sales price of tobacco products in the bill, the inventory tax is assessed on any tobacco products remaining in inventories taxed under the previous tax rate that is equal to the difference between the previous tax rate and the new tax rate.
   Code section 453A.35 specifies that revenues from the tax on tobacco products are deposited into the health care trust fund created in Code section 453A.35A.
   The bill also makes other conforming changes to Code section 453A.43.
   DIVISION III —— EXCISE TAX ON VAPOR PRODUCTS. The bill creates an excise tax on vapor products at a rate of 15 percent on the sales price from the retail sale, including a delivery sale, of vapor products to consumers. The excise tax is in addition to any other tax imposed by law. The excise tax shall be collected at the point of sale from the consumer. The bill requires the director of revenue to administer the vapor product excise tax as nearly as possible in conjunction with the administration of the state sales and use tax law, except that portion of the law that implements the streamlined sales and use tax agreement. The bill deposits all revenues raised from the vapor products excise tax into the health care trust fund created in Code section 453A.35A. The bill requires the department to adopt rules to administer the new excise tax.
   The bill makes other conforming changes to implement the new tax.
   DIVISION IV —— EXCISE TAX ON CONSUMABLE HEMP PRODUCTS. The bill creates an excise tax on consumable hemp products at a rate of 15 percent on the sales price from the retail sale, including a delivery sale, of consumable hemp products to consumers. The excise tax is in addition to any other tax imposed by law. The bill requires the department to adopt rules to administer the new excise tax. The bill requires the director of revenue to administer the consumable hemp excise tax as nearly as possible in conjunction with the administration of the state sales and use tax law, except that portion of the law that implements the streamlined sales and use tax agreement. The bill deposits all revenues raised from the consumable hemp excise tax into the health care trust fund created in Code section 453A.35A.
   DIVISION V —— APPROPRIATIONS. For the fiscal year beginning July 1, 2026, and ending June 30, 2027, the bill makes an appropriation to the department of human services in the amount of $1 million from the health care trust fund created in Code section 453A.35A, to be used to provide a grant to the Iowa healthiest state initiative to support the double up food bucks program to make fresh fruits and vegetables sold at farmers markets, grocery stores, and other participating locations accessible to individuals and families who reside in this state and receive assistance through the federal supplemental nutrition assistance program.
   For the fiscal year beginning July 1, 2026, and ending June 30, 2027, the bill makes an appropriation to the department of justice in the amount of $1 million from the health care trust fund created in Code section 453A.35A, to be used to provide victim assistance grants to care providers providing services to victims of human trafficking.