Nicotine Goods Seller Challenges Tobacco Tax at Texas High Court

The Texas Supreme Court should leave in place a holding that RJR Vapor Co. LLC’s oral nicotine products aren’t subject to tobacco taxes because the goods don’t contain tobacco, the company said.

RJR said nicotine pouches and lozenges it sold under the brand name VELO don’t meet the definition of tobacco products or substitutes under the Texas Tax Code. The Velo products contain nicotine isolate, a chemical that isn’t made up of tobacco plants or leaves, RJR said.

“And although the nicotine isolate in VELO happens to be extracted from tobacco, nicotine isolate can also be extracted from other ...