Alabama cities to issue new tax on vape products

MONTGOMERY, Ala. (WIAT) — Some cities in Alabama are imposing a new tax on vape products.

It’s all apart of a new law requiring businesses to get a permit to sell vapes. Municipalities have until October 1 to decide how they want to issue the new tax in their community, that’s 10 cents for every milliliter of vaping liquid sold.

Ford Handley, city administrator and finance director for the city of Orange Beach, said they passed a local tax so their community could use all the revenue. He said otherwise, revenue from the state tax is based on population, giving them a fraction of what they could be collecting for the city.

“For us, it’s almost a fairness issue,” Handley said. “We look at the vape products very similar to tobacco. And, if tobacco is being taxed this way, then the vape needs to be taxed the same way.”

Places like Dothan, Muscle Shoals, and Decatur are also assessing those products. Lori Rossetti, revenue manager for the city of Decatur, said the tax isn’t changing anything major.

“We definitely don’t want to run any of our businesses out of town or prevent someone from coming into the city,” she said. “Like I said, this is something the state was going to do regardless. And, we’re just gonna collect it.”

Rossetti said being able to collect those dollars and put them back into communities is important.

“For the city of Decatur, it just means that we won’t be sharing in those proceeds,” Rossetti explained. “So that we can do more work for beautification, to add facilities for our people so we can do more roadwork, so we can hopefully better benefit the citizens of Decatur.”

For cities that decide against enacting their own tax on vaping products, the state levy will begin October 1, 2026.