The Rhode Island Division of Taxation reminds
taxpayers and tax professionals of an upcoming change to the taxation of other
tobacco products (OTP). Recent legislation has expanded the definition of
products categorized as OTP. As of 12:01 a.m. on October 1, 2025, certain products
that contain nicotine will be taxed as OTP, whether the nicotine is natural
or artificial.*
The
update to the definition of OTP will generally expand the range of products
considered OTP. An example of such a product is nicotine pouches, which do not
meet the definition of OTP in effect prior to 10/1/2025, but which is included
in the definition of OTP on and after October 1, 2025. The tax rate for these
products will be 80% of the wholesale cost of the product.
More information is available in Advisory 2025-19.
* “Other tobacco products” does not include any product that has been approved by the United States Food and Drug Administration for the sale of or use as a tobacco or nicotine cessation product.
