I 
119TH CONGRESS 
1ST SESSION H. R. 1798 
To amend the Internal Revenue Code of 1986 to provide tax rate parity 
among all tobacco products, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 3, 2025 
Mr. KRISHNAMOORTHI introduced the following bill; which was referred to the 
Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to provide 
tax rate parity among all tobacco products, and for other 
purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘End Tobacco Loop-
holes Act’’. 
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SEC. 2. INCREASING EXCISE TAXES ON CIGARETTES AND 
ESTABLISHING EXCISE TAX EQUITY AMONG 
ALL TOBACCO PRODUCT TAX RATES. 
(a) TAX PARITY FOR ROLL-YOUR-OWN TOBACCO.— 
Section 5701(g) of the Internal Revenue Code of 1986 is 
amended by striking ‘‘$24.78’’ and inserting ‘‘$49.56’’. 
(b) TAX
PARITY
FOR
PIPE
TOBACCO.—Section 
5701(f) of the Internal Revenue Code of 1986 is amended 
by striking ‘‘$2.8311 cents’’ and inserting ‘‘$49.56’’. 
(c) TAX PARITY FOR SMOKELESS TOBACCO.— 
(1) Section 5701(e) of the Internal Revenue 
Code of 1986 is amended— 
(A) in paragraph (1), by striking ‘‘$1.51’’ 
and inserting ‘‘$26.84’’; 
(B) in paragraph (2), by striking ‘‘50.33 
cents’’ and inserting ‘‘$10.74’’; and 
(C) by adding at the end the following: 
‘‘(3) SMOKELESS TOBACCO SOLD IN DISCRETE 
SINGLE-USE
UNITS.—On discrete single-use units, 
$100.66 per thousand.’’. 
(2) Section 5702(m) of such Code is amend-
ed— 
(A) in paragraph (1), by striking ‘‘or chew-
ing tobacco’’ and inserting ‘‘, chewing tobacco, 
or discrete single-use unit’’; 
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(B) in paragraphs (2) and (3), by inserting 
‘‘that is not a discrete single-use unit’’ before 
the period in each such paragraph; and 
(C) by adding at the end the following: 
‘‘(4) DISCRETE SINGLE-USE UNIT.—The term 
‘discrete single-use unit’ means any product con-
taining, made from, or derived from tobacco or nico-
tine that— 
‘‘(A) is not intended to be smoked; and 
‘‘(B) is in the form of a lozenge, tablet, 
pill, pouch, dissolvable strip, or other discrete 
single-use or single-dose unit.’’. 
(d) TAX PARITY FOR SMALL CIGARS.—Paragraph 
(1) of section 5701(a) of the Internal Revenue Code of 
1986 is amended by striking ‘‘$50.33’’ and inserting 
‘‘$100.66’’. 
(e) TAX PARITY FOR LARGE CIGARS.— 
(1) IN
GENERAL.—Paragraph (2) of section 
5701(a) of the Internal Revenue Code of 1986 is 
amended by striking ‘‘52.75 percent’’ and all that 
follows through the period and inserting the fol-
lowing: ‘‘$49.56 per pound and a proportionate tax 
at the like rate on all fractional parts of a pound but 
not less than 10.066 cents per cigar.’’. 
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(2) GUIDANCE.—The Secretary of the Treas-
ury, or the Secretary’s delegate, may issue guidance 
regarding the appropriate method for determining 
the weight of large cigars for purposes of calculating 
the applicable tax under section 5701(a)(2) of the 
Internal Revenue Code of 1986. 
(3) CONFORMING AMENDMENT.—Section 5702 
of such Code is amended by striking subsection (l). 
(f) TAX PARITY
FOR ROLL-YOUR-OWN TOBACCO 
AND CERTAIN PROCESSED TOBACCO.—Subsection (o) of 
section 5702 of the Internal Revenue Code of 1986 is 
amended by inserting ‘‘, and includes processed tobacco 
that is removed for delivery or delivered to a person other 
than a person with a permit provided under section 5713, 
but does not include removals of processed tobacco for ex-
portation’’ after ‘‘wrappers thereof’’. 
(g) IMPOSITION OF TAX ON NICOTINE FOR USE IN 
VAPING, ETC.— 
(1) IN GENERAL.—Section 5701 of the Internal 
Revenue Code of 1986 is amended by redesignating 
subsection (h) as subsection (i) and by inserting 
after subsection (g) the following new subsection: 
‘‘(h) NICOTINE.—On taxable nicotine, manufactured 
in or imported into the United States, there shall be im-
posed a tax equal to the dollar amount specified in section 
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5701(b)(1) per 1,810 milligrams of nicotine (and a pro-
portionate tax at the like rate on any fractional part there-
of).’’. 
(2) TAXABLE NICOTINE.—Section 5702 of such 
Code is amended by adding at the end the following 
new subsection: 
‘‘(q) TAXABLE NICOTINE.— 
‘‘(1) IN GENERAL.—Except as otherwise pro-
vided in this subsection, the term ‘taxable nicotine’ 
means any nicotine which has been extracted, con-
centrated, or synthesized. 
‘‘(2) EXCEPTION FOR PRODUCTS APPROVED BY 
FOOD
AND
DRUG
ADMINISTRATION.—Such term 
shall not include any nicotine if the manufacturer or 
importer thereof demonstrates to the satisfaction of 
the Secretary of Health and Human Services that 
such nicotine will be used in— 
‘‘(A) a drug— 
‘‘(i) that is approved under section 
505 of the Federal Food, Drug, and Cos-
metic Act or licensed under section 351 of 
the Public Health Service Act; or 
‘‘(ii) for which an investigational use 
exemption has been authorized under sec-
tion 505(i) of the Federal Food, Drug, and 
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Cosmetic Act or under section 351(a) of 
the Public Health Service Act; or 
‘‘(B) a combination product (as described 
in section 503(g) of the Federal Food, Drug, 
and Cosmetic Act), the constituent parts of 
which were approved or cleared under section 
505, 510(k), or 515 of such Act. 
‘‘(3) COORDINATION WITH TAXATION OF OTHER 
TOBACCO
PRODUCTS.—Tobacco products meeting 
the definition of cigars, cigarettes, smokeless to-
bacco, pipe tobacco, and roll-your-own tobacco in 
this section shall be classified and taxed as such de-
spite any concentration of the nicotine inherent in 
those products or any addition of nicotine to those 
products during the manufacturing process. 
‘‘(4) REGULATIONS.—The Secretary shall pre-
scribe such regulations or other guidance as is nec-
essary or appropriate to carry out the purposes of 
this subsection, including regulations or other guid-
ance for coordinating the taxation of tobacco prod-
ucts and taxable nicotine to protect revenue and pre-
vent double taxation.’’. 
(3) TAXABLE
NICOTINE
TREATED
AS
A
TO-
BACCO PRODUCT.—Section 5702(c) of such Code is 
amended by striking ‘‘and roll-your-own tobacco’’ 
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and inserting ‘‘roll-your-own tobacco, and taxable 
nicotine’’. 
(4) MANUFACTURER OF TAXABLE NICOTINE.— 
Section 5702 of such Code, as amended by para-
graph (2), is amended by adding at the end the fol-
lowing new subsection: 
‘‘(r) MANUFACTURER OF TAXABLE NICOTINE.— 
‘‘(1) IN GENERAL.—Any person who extracts, 
concentrates, or synthesizes nicotine shall be treated 
as a manufacturer of taxable nicotine (and as manu-
facturing such taxable nicotine). 
‘‘(2) APPLICATION
OF
RULES
RELATED
TO 
MANUFACTURERS
OF
TOBACCO
PRODUCTS.—Any 
reference to a manufacturer of tobacco products, or 
to manufacturing tobacco products, shall be treated 
as including a reference to a manufacturer of tax-
able nicotine, or to manufacturing taxable nicotine, 
respectively.’’. 
(h) INCREASING TAX ON CIGARETTES.— 
(1) SMALL
CIGARETTES.—Section 5701(b)(1) 
of such Code is amended by striking ‘‘$50.33’’ and 
inserting ‘‘$100.66’’. 
(2) LARGE
CIGARETTES.—Section 5701(b)(2) 
of such Code is amended by striking ‘‘$105.69’’ and 
inserting ‘‘$211.38’’. 
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(i) TAX RATES ADJUSTED FOR INFLATION.—Section 
5701 of such Code, as amended by subsection (g), is 
amended by adding at the end the following new sub-
section: 
‘‘(j) INFLATION ADJUSTMENT.— 
‘‘(1) IN GENERAL.—In the case of any calendar 
year beginning after 2026, the dollar amounts pro-
vided under this chapter shall each be increased by 
an amount equal to— 
‘‘(A) such dollar amount, multiplied by 
‘‘(B) the cost-of-living adjustment deter-
mined under section 1(f)(3) for the calendar 
year, determined by substituting ‘calendar year 
2025’ for ‘calendar year 2016’ in subparagraph 
(A)(ii) thereof. 
‘‘(2) ROUNDING.—If any amount as adjusted 
under paragraph (1) is not a multiple of $0.01, such 
amount shall be rounded to the next highest multiple 
of $0.01.’’. 
(j) FLOOR STOCKS TAXES.— 
(1) IMPOSITION OF TAX.—On tobacco products 
manufactured in or imported into the United States 
which are removed before any tax increase date and 
held on such date for sale by any person, there is 
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hereby imposed a tax in an amount equal to the ex-
cess of— 
(A) the tax which would be imposed under 
section 5701 of the Internal Revenue Code of 
1986 on the article if the article had been re-
moved on such date, over 
(B) the prior tax (if any) imposed under 
section 5701 of such Code on such article. 
(2) CREDIT AGAINST TAX.—Each person shall 
be allowed as a credit against the taxes imposed by 
paragraph (1) an amount equal to $500. Such credit 
shall not exceed the amount of taxes imposed by 
paragraph (1) on such date for which such person 
is liable. 
(3) LIABILITY FOR TAX AND METHOD OF PAY-
MENT.— 
(A) LIABILITY FOR TAX.—A person hold-
ing tobacco products on any tax increase date 
to which any tax imposed by paragraph (1) ap-
plies shall be liable for such tax. 
(B) METHOD OF PAYMENT.—The tax im-
posed by paragraph (1) shall be paid in such 
manner as the Secretary shall prescribe by reg-
ulations. 
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(C) TIME
FOR
PAYMENT.—The tax im-
posed by paragraph (1) shall be paid on or be-
fore the date that is 120 days after the effective 
date of the tax rate increase. 
(4) ARTICLES
IN
FOREIGN
TRADE
ZONES.— 
Notwithstanding the Act of June 18, 1934 (com-
monly known as the Foreign Trade Zone Act, 48 
Stat. 998, 19 U.S.C. 81a et seq.), or any other pro-
vision of law, any article which is located in a for-
eign trade zone on any tax increase date shall be 
subject to the tax imposed by paragraph (1) if— 
(A) internal revenue taxes have been deter-
mined, or customs duties liquidated, with re-
spect to such article before such date pursuant 
to a request made under the first proviso of 
section 3(a) of such Act, or 
(B) such article is held on such date under 
the supervision of an officer of the United 
States Customs and Border Protection of the 
Department of Homeland Security pursuant to 
the second proviso of such section 3(a). 
(5) DEFINITIONS.—For purposes of this sub-
section— 
(A) IN GENERAL.—Any term used in this 
subsection which is also used in section 5702 of 
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such Code shall have the same meaning as such 
term has in such section. 
(B) TAX INCREASE DATE.—The term ‘‘tax 
increase date’’ means the effective date of any 
increase in any tobacco product excise tax rate 
pursuant to the amendments made by this sec-
tion (other than subsection (j) thereof). 
(C) SECRETARY.—The term ‘‘Secretary’’ 
means the Secretary of the Treasury or the 
Secretary’s delegate. 
(6) CONTROLLED
GROUPS.—Rules similar to 
the rules of section 5061(e)(3) of such Code shall 
apply for purposes of this subsection. 
(7) OTHER LAWS APPLICABLE.—All provisions 
of law, including penalties, applicable with respect to 
the taxes imposed by section 5701 of such Code 
shall, insofar as applicable and not inconsistent with 
the provisions of this subsection, apply to the floor 
stocks taxes imposed by paragraph (1), to the same 
extent as if such taxes were imposed by such section 
5701. The Secretary may treat any person who bore 
the ultimate burden of the tax imposed by para-
graph (1) as the person to whom a credit or refund 
under such provisions may be allowed or made. 
(k) EFFECTIVE DATES.— 
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(1) IN GENERAL.—Except as provided in para-
graphs (2) through (4), the amendments made by 
this section shall apply to articles removed (as de-
fined in section 5702(j) of the Internal Revenue 
Code of 1986) after the last day of the month which 
includes the date of the enactment of this Act. 
(2) DISCRETE SINGLE-USE UNITS AND PROC-
ESSED TOBACCO.—The amendments made by sub-
sections (c)(1)(C), (c)(2), and (f) shall apply to arti-
cles removed (as defined in section 5702(j) of the 
Internal Revenue Code of 1986) after the date that 
is 6 months after the date of the enactment of this 
Act. 
(3) LARGE CIGARS.—The amendments made by 
subsection (e) shall apply to articles removed after 
December 31, 2025. 
(4) TAXABLE
NICOTINE.—The amendments 
made by subsection (g) shall apply to articles re-
moved in calendar quarters beginning after the date 
which is 180 days after the date of the enactment 
of this Act. 
(l) TRANSITION RULE FOR PERMIT AND BOND RE-
QUIREMENTS.—A person which is lawfully engaged in 
business as a manufacturer or importer of taxable nicotine 
(within the meaning of subchapter A of chapter 52 of the 
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Internal Revenue Code of 1986, as amended by this sec-
tion) on the date of the enactment of this Act, first be-
comes subject to the requirements of subchapter B of 
chapter 52 of such Code by reason of the amendments 
made by this section, and submits an application under 
such subchapter B to engage in such business not later 
than 90 days after the date of the enactment of this Act, 
shall not be denied the right to carry on such business 
by reason of such requirements before final action on such 
application. 
Æ 
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