SB 20 New Mexico Senate · 2025 Regular Session

INCREASE CIGARETTE & TOBACCO PRODUCTS TAXES

SB 20 increases cigarette and tobacco product taxes in New Mexico, directly affecting consumers who purchase these products. It raises tax rates, expands the definition of "tobacco product" to include all nicotine sources, and creates a new Nicotine Use Prevention and Control Fund. Revenue from the tax increases will fund state health programs targeting youth and young adults (ages 5-25) to prevent nicotine use, administered by the Department of Health with funds distributed to specific health initiatives like cancer centers and rural treatment programs. The bill also adjusts existing tax distribution formulas for state health programs.

Bill status passed 3 of 5 stages cleared

Introduction

Jan 2025

Committee Review

Mar 2025

Senate Passage

Mar 2025

House Passage

Governor

Introduced Jan 21, 2025 Last action Jun 3, 2025

Maddy AI version diff · 1 comparison

What changed between versions

introduced version → CT substitute · 7 edits

MODERATE

This bill reorganizes tobacco tax revenue distribution and expands the definition of taxable products to include nicotine and e-cigarettes. The most significant change is redirecting cigarette tax revenue from the University of New Mexico's cancer center to a new Nicotine Use Prevention and Control Fund for youth education programs. The bill also increases the cigarette tax rate from 25% to 40% and adds new taxes on e-liquid and e-cigarettes.

Scope change

The bill expands the scope of taxable products to include nicotine in any form and e-cigarettes, while removing exemptions for certain electronic devices and cannabis-containing liquids.

FISCAL

Created a new Nicotine Use Prevention and Control Fund to receive 35% of cigarette tax revenue, replacing the previous distribution to the University of New Mexico cancer center.

Increased the cigarette tax rate from 25% to 40% of wholesale price.

DEFINITION

Added new definitions for e-cigarettes, e-liquid, closed system cartridges, and nicotine to clarify what products are taxed.

REQUIREMENT

Imposed a new 12.5% tax on e-liquid and a $0.50 per cartridge tax on closed system cartridges.

ELIGIBILITY

Expanded the definition of 'tobacco product' to include any product containing nicotine regardless of source, including synthetic nicotine.

Removed exemptions for e-cigarettes and e-liquid from the tobacco products tax.

TIMELINE

Set the effective date of the new tax provisions to July 1, 2025.

Floor votes · Senate Mar 7, 2025

How they voted

23–14

Passed · 3 other

Total votes 40

Mar 7, 2025

D Democratic24

23 Yea 1

95% Yea

R Republican16

14 Nay 2

87% Nay

Vote distribution

All Yea All Nay Mixed No data

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Mar 12, 2025

Lower · Passed

DO PASS committee report adopted

lower

Mar 10, 2025

Introduced

Sent to House Health & Human Services Committee & House Taxation & Revenue Committee

lower

Mar 7, 2025

Upper · Passed

passed Senate

upper

Mar 3, 2025

Upper · Passed

DO PASS committee report adopted

upper

Feb 19, 2025

Upper · Passed

DO NOT PASS, replaced with committee substitute

upper

Jan 21, 2025

Introduced

Sent to Senate Tax, Business and Transportation Committee & Senate Finance Committee

upper

2 primary · 0 co-sponsors