Hochul's 'ZYN tax' opponents make their case at the state Capitol

And the battle over Climate Act changes heats up between Hochul and lawmakers.

Good afternoon — It’s Thursday and Pistachio Day.

In today’s CapCon:

• The Hochul administration released a new memo that claims forcing the state’s climate mandates would raise costs by up to $4,000 for New York households.

• Lawmakers said Hochul’s push to change those mandates is “a public policy mistake” and warned against forcing them into the state budget.

• Opponents of Hochul’s proposed tax on nicotine products, like ZYN pouches, are using public health concerns and state spending to argue against it.

• We’re expected to receive fresh numbers on the state’s projected revenue for the next fiscal year Friday, setting up negotiations around the state budget.

Names in today’s CapCon: Kathy Hochul, Brian Erkkila, Alison Ritchie, Paul Zuber, Doreen Harris, Rory Christian, Blake Washington, Liz Moran, Andrew Cuomo, Peter Harckham, Deborah Glick, and Donald Trump

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News on the state budget, including proposals, negotiations and results.

(Will Waldron/Times Union)

💵 Opponents of Hochul’s ‘ZYN tax’ cite health outcomes and state spending

One of the few revenue raisers included in Hochul’s executive budget proposal this year is a new tax on nicotine products that don’t contain tobacco.

It’s been coined as the “ZYN tax,” referring to the popular brand of nicotine pouches to which the tax would apply. Hochul wants to impose a 75% tax on those items — the same that’s levied on wholesale tobacco products.

The idea is to reduce the likelihood that consumers will purchase those products and develop an addiction to nicotine, which could lead to them taking up cigarettes.

But opponents of the tax are trying to convince lawmakers to reject it by turning that argument on its head.

Raising the cost of those products, they said at the state Capitol Thursday, would make it more difficult for people who already smoke cigarettes to quit. If the cost of an alternative nicotine product is the same, the incentive is weaker, they said.

“We think that these smoke-free alternatives should be available so that they have another option other than quitting or complete abstinence because not everyone’s ready to make that change,” said Brian Erkkila, head of scientific engagement for PMI U.S. Corporate Services, which is part of Philip Morris International, the owner of the ZYN brand.

People who smoke are more likely to be from low-income households, according to data from the U.S. Centers for Disease Control.

Making tobacco-free nicotine products more expensive would make them less likely to purchase them as a way to quit smoking, Erkkila said. ZYN pouches have been authorized by the U.S. Food and Drug Administration to be marketed as a lower-risk alternative to smoking.

“A harm reduction approach is not only to have these products available but to have them at a price where smokers can switch to them,” he said.

That’s one side of the case being made against Hochul’s proposed tax. The other side is more business-focused.