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NebraskaLB9109th Legislature 1st and 2nd SessionslegislatureWALLET

Change provisions relating to cigarette taxes and the Tobacco Products Tax Act and provide for regulation of products containing nicotine analogues

Sponsored By: Jana Hughes

Signed by Governor

Revenue Committee

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Bill Overview

Analyzed Economic Effects

7 provisions identified: 0 benefits, 4 costs, 3 mixed.

New business taxes on vapes and nicotine

Starting January 1, 2026, alternative nicotine products are taxed at 20% of the first owner's price. Other tobacco products not covered elsewhere are also taxed at 20% on the same base. Electronic nicotine devices with more than 3 milliliters are taxed at 10% of the first owner's price. These taxes are in addition to other taxes.

Tougher penalties and seizures for sellers

The Tax Commissioner can suspend or revoke tobacco licenses after a hearing and fine up to $5,000 per violation. Products sold in violation are contraband and can be seized without a warrant. Owners must pay seizure and destruction costs. Businesses covered by the act face the same listing, stamping, and suspension rules as other tobacco sellers. These rules take effect January 1, 2026.

Makers must file monthly cigarette reports

Beginning January 1, 2026, cigarette manufacturers and importers must file a monthly report within 15 days after month end. Reports must list Nebraska sales, brand families, and buyers, including affiliate sales. Timely federal reports under 15 U.S.C. 376 can satisfy the monthly filing. They must also submit quarterly federal excise returns and TTB Form 5210.5 within 60 days or provide an IRS disclosure consent. If asked, they must share copies of sales reports filed in other states.

New tax on small vape pods

Beginning January 1, 2026, devices with 3 milliliters or less are taxed at $0.05 per milliliter. Fractional milliliters are taxed too. The first owner pays the tax, and stores may pass it into prices.

Deadlines for tobacco tax audits

Beginning January 1, 2026, the Tax Commissioner must issue deficiency notices within three years in most cases. The window is six years for no return, fraud to evade tax, or omissions over 25%. Notices may be mailed or personally served. The taxpayer and the agency can agree in writing to extend. These timing rules apply to cigarette and tobacco products returns.

All changes start January 1, 2026

The law becomes operative on January 1, 2026. Older tobacco tax statutes listed in the act are repealed that day. Rules now sit in a unified framework for tobacco and nicotine products.

Broader definitions for nicotine and vapes

The law defines “nicotine analogue.” It expands what counts as an electronic nicotine device to include devices and parts that deliver nicotine or its analogues. It broadens “alternative nicotine product,” but still excludes e‑cigarettes, cigarettes, cigars, and FDA‑regulated drugs or devices. It also defines “consumable material” for devices starting January 1, 2026. These updates expand coverage and give clearer rules to makers and sellers.

Sponsors & Cosponsors

Sponsor

  • Jana Hughes

    Senate

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 163 • No: 58

legislature vote • 4/25/2025

Final Reading

Yes: 34 • No: 10

legislature vote • 3/19/2025

Vote

Yes: 41 • No: 0 • Other: 8

legislature vote • 3/19/2025

Vote

Yes: 5 • No: 24 • Other: 20

legislature vote • 3/19/2025

Vote

Yes: 39 • No: 0 • Other: 10

legislature vote • Unknown

Vote

Yes: 39 • No: 0 • Other: 10

legislature vote • Unknown

Vote

Yes: 5 • No: 24 • Other: 20

Actions Timeline

  1. Provisions/portions of LB125 amended into LB9 by AM549

    6/6/2025legislature

  2. Approved by Governor on April 29, 2025

    4/29/2025legislature

  3. Presented to Governor on April 25, 2025

    4/25/2025legislature

  4. President/Speaker signed

    4/25/2025legislature

  5. Passed on Final Reading 34-10*-5

    4/25/2025legislature

  6. Dispensing of reading at large approved

    4/25/2025legislature

  7. Conrad FA136 not considered

    4/25/2025legislature

  8. Motion to return to Select File failed

    4/25/2025legislature

  9. Conrad FA136 filed

    4/25/2025legislature

  10. Enrollment and Review ST20 recorded

    4/22/2025legislature

  11. Enrollment and Review ST20 filed

    4/22/2025legislature

  12. Placed on Final Reading with ST20

    4/22/2025legislature

  13. Advanced to Enrollment and Review for Engrossment

    4/17/2025legislature

  14. Enrollment and Review ER31 adopted

    4/17/2025legislature

  15. Enrollment and Review ER31 filed

    3/27/2025legislature

  16. Placed on Select File with ER31

    3/27/2025legislature

  17. Advanced to Enrollment and Review Initial

    3/19/2025legislature

  18. General Affairs AM549 adopted

    3/19/2025legislature

  19. Raybould AM646 lost

    3/19/2025legislature

  20. Raybould AM646 to AM549 filed

    3/19/2025legislature

  21. General Affairs priority bill

    3/12/2025legislature

  22. General Affairs AM549 filed

    3/10/2025legislature

  23. Placed on General File with AM549

    3/10/2025legislature

  24. Notice of hearing for February 24, 2025

    2/5/2025legislature

  25. Rereferred to General Affairs Committee

    1/17/2025legislature

Bill Text

  • Introduced

    1/9/2025

    PDF

  • Enrolled / Slip Law

    PDF

  • Final / Enacted

    PDF

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