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-Session of 2026
-HOUSE BILL No. 2783
-By Committee on Taxation
-Requested by Representative Goetz
-2-17
-AN ACT concerning taxation; relating to electronic cigarettes; increasing
-the tax on electronic cigarettes and crediting the increased revenue to
-the children's initiative fund; amending K.S.A. 79-3387 and 79-3399
-and repealing the existing sections.
-Be it enacted by the Legislature of the State of Kansas:
-Section 1. K.S.A. 79-3387 is hereby amended to read as follows: 79-
-3387.  (a)  Except  as  otherwise  provided  in  subsection  (c),  all  revenue
-collected or received by the director from taxes imposed by this act shall
-be remitted to the state treasurer in accordance with the provisions of
-K.S.A.  75-4215,  and  amendments  thereto.  Upon  receipt  of  each  such
-remittance, the state treasurer shall deposit the entire amount in the state
-treasury to the credit of the state general fund.
-(b) All moneys received from license fees , forfeiture proceeds under
-K.S.A. 79-3324a, and amendments thereto, and fines  imposed by this act
-shall be collected by the director and shall be remitted to the state treasurer
-in accordance with the provisions of K.S.A. 75-4215, and amendments
-thereto. Upon  receipt of each such  remittance,  the state treasurer shall
-deposit the entire amount in the state treasury to the credit of the cigarette
-and  tobacco  products  regulation  fund  created  by K.S.A.  79-3391,  and
-amendments  thereto,  and  such  proceeds  shall  be  used  exclusively  for
-cigarette and tobacco products regulation and enforcement, and not for any
-other purpose.
-(c) The state treasurer shall deposit and credit $.10 of each mililiter
-of consumable material for electronic cigarettes, or the proportionate tax
-at the like rate of all fractional parts thereof, collected or received from
-taxes imposed pursuant to K.S.A. 79-3399, and amendments thereto, to the
-children's initiative fund established in K.S.A. 38-2102, and amendments
-thereto.
-Sec.  2. K.S.A. 79-3399 is hereby amended to read as follows: 79-
-3399. (a)  On and after July 1, 2017,  A tax is hereby imposed upon the
-privilege of selling or dealing in electronic cigarettes in this state by any
-person engaged in business as a distributor thereof, at the rate  of $.05 $.15
-per  milliliter  of  consumable  material  for  electronic  cigarettes  and  a
-proportionate  tax  at  the  like  rate  on  all  fractional  parts  thereof.  For
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-HB 2783 2
-electronic cigarettes in the possession of retail dealers for which tax has
-not been paid, tax shall be imposed under this subsection at the earliest
-time the retail dealer:
-(1) Brings or causes to be brought into this state from without the
-state electronic cigarettes for sale;
-(2) makes,  manufactures  or  fabricates  electronic  cigarettes  in  this
-state for sale in this state; or
-(3) sells electronic cigarettes to consumers within this state.
-(b) As used in this section, "consumable material" means any liquid
-solution or other material that is depleted as an electronic cigarette is used.
-(c) The  secretary  of  revenue  shall  adopt  rules  and  regulations  to
-implement the provisions of this section.
-Sec. 3. K.S.A. 79-3387 and 79-3399 are hereby repealed.
-Sec. 4. This act shall take effect and be in force from and after its
-publication in the statute book.
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+Division of the Budget
+Docking State Office Building Phone: (785) 296-2436
+915 SW Harrison Street, Suite 310 adam.c.proffitt@ks.gov
+Topeka, KS  66612 http://budget.kansas.gov
+
+Adam C. Proffitt, Director Laura Kelly, Governor
+Division of the Budget
+
+March 2, 2026
+
+The Honorable Adam Smith, Chairperson
+House Committee on Taxation
+300 SW 10th Avenue, Room 346-S
+Topeka, Kansas  66612
+
+Dear Representative Smith:
+
+ SUBJECT: Fiscal Note for HB 2783 by House Committee on Taxation
+
+ In accordance with KSA 75 -3715a, the following fiscal note concerning HB 2783 is
+respectfully submitted to your committee.
+
+ HB 2783 would increase the state tax rate from $0.05 to $0.15 per milliliter of consumable
+material to for electronic cigarettes and a proportionate tax at the like rate on all fractional parts
+thereof.  The bill would direct the State Treasurer to deposit and credit $0.10 of each milliliter of
+consumable material to for electronic cigarettes and a proportionate tax at the like rate on all
+fractional parts thereof, collected or received from taxes imposed pursuant to KSA 79 -3399, and
+amendments thereto, to the Children’s Initiative Fund.
+
+ The Kansas Office of Early Childhood reports that the Office does not yet have the means
+to estimate the increased revenue, but the revenue would create additional financial sustainability
+and benefit early childhood programs under the agency’s jurisdiction.   The bill would credit the
+revenue to the Children’s Initiatives Fund (CIF), rather than the Kansas Endowment for Youth
+(KEY) Fund.  The Office notes that depositing the new revenue in the KEY Fund would better
+align with current practice regarding the allocation of funding for children’s programs.  The Kansas
+State Department of Education, where the Children’s Cabinet is currently housed, states enactment
+of the bill would not have a fiscal effect on the agency.  The bill would increase revenue for the
+CIF for early childhood programs, but the agency is not able to estimate the potential impact.
+
+ According to the Kansas Department of Revenue, enactment of HB 2783 would result in
+revenue of $7.12 million credited to the CIF each fiscal year.  This estimate was based on a five-
+year average of $3.56 million collected at the current rate on consumable material for electronic
+cigarettes.  The agency anticipates administrative costs of $7,028 to implement the bill’s
+The Honorable Adam Smith, Chairperson
+Page 2—HB 2783
+
+provisions.  This would include $3,028 for tax operations and $4,000 for 80 hours of IT E -
+Commerce work.
+
+ The Kansas State Treasurer’s Office  reports the bill would require the Office to modify
+accounting procedures, but any additional workload would be handled within existing resources .
+Any fiscal effect associated with HB 2783 is not reflected in The FY 20 27 Governor’s Budget
+Report.
+
+ Sincerely,
+
+ Adam C. Proffitt
+ Director of the Budget
+
+cc: Gabrielle Hull, Department of Education
+ Christi Smith, Office of Early Childhood
+ John Hedges, Office of the State Treasurer
+ Lynn Robinson, Department of Revenue