DeSantis grants tax favor for Philip Morris after $500,000 gift

The DeSantis administration ruling for Philip Morris International comes as the Big Tobacco giant lobbies state lawmakers to exempt heated tobacco products like its IQOS device from tobacco tax laws.

Photo credit: SimonDes

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Last fall, as Ron DeSantis was raising money to fight a pair of ballot measures that would have legalized marijuana and ended a statewide abortion ban, Florida’s governor turned to an odious source for help: Philip Morris International, the Big Tobacco company best known as the maker of Marlboro cigarettes.

Records show DeSantis took $500,000 from Philip Morris in the closing weeks of last year’s campaign, making the tobacco company one of the top contributors to the fundraising committee DeSantis used to oppose the marijuana and abortion-rights ballot measures.

It was a big favor for the governor, who made himself the face of the opposition to the two constitutional amendments — both of which fell just short of the 60 percent supermajority needed to pass.

And now Ron DeSantis has done a big favor for Philip Morris.

The governor’s administration this month issued a key legal ruling declaring that Philip Morris’ IQOS brand of heated tobacco products are not subject to state cigarette and tobacco taxes.

The so-called “declaratory statement” frees the company to sell its IQOS line in Florida at a deep discount to other tobacco products that must charge state tobacco taxes and surcharges — a hefty set of levies that not only raise money for important public services but that also deter the use of intentionally addictive nicotine products with dangerous long-term health effects.

It’s an enormous win for Philip Morris International, a $235 billion global giant that has bet much of its future on the growth IQOS, an electronic device that heats tobacco-infused “heatsticks” to release an aerosol laced with nicotine — a drug that is at least as addictive as heroin.

The ruling comes as the company, which markets IQOS as a lower-risk alternative to traditional cigarettes, is lobbying Florida’s Republican-controlled Legislature to pass legislation that would explicitly exempt heated tobacco products from the state’s tobacco tax laws. The company’s bills are marching steadily through Tallahassee this session — despite opposition from groups like the American Cancer Society who warn that heated tobacco products like IQOS are still dangerous and that they are designed to addict young people with flavor options like mint and “tropical menthol.”

It’s part of a national lobbying blitz by Philip Morris, which has added lobbyists in roughly two dozen states in recent years to push similar bills in Capitols around the country. The company, which already sells IQOS in overseas markets like Japan and the United Kingdom, is about to launch the product in the United States, starting in Texas.

The DeSantis administration’s new ruling in favor of Philip Morris is fishy for a few reasons — and not just because it came after the governor cashed $500,000 in company checks.

Just a few weeks ago, the administration seemed to be of the opinion that heated tobacco products like IQOS and similar devices in development by Reynolds American were, in fact, subject to Florida tobacco taxes.

That’s according to discussion from the Revenue Estimating Impact Conference, a panel of state economists who met March 7 to “score” House Bill 785 by estimating the impact to future state budgets of creating a new tax break for heated tobacco products.

“The department’s position is that heated tobacco products are going to be taxable,” Amy Baker, Florida’s chief economist, said during the meeting, a reference to the Department of Business and Professional Regulation.

Photo credit: Vaping360

But the DeSantis administration apparently changed its mind — and it did so very quickly.

Records show Philip Morris International filed a petition Feb. 11 asking the Division of Alcoholic Beverages and Tobacco — which is a part of DBPR — to determine whether IQOS products are subject to tobacco taxes under current law.

To make its case, Philip Morris hired Jeff Aaron, an attorney and Ron DeSantis ally who helped run a Super PAC set up to support DeSantis during the governor’s ill-fated presidential campaign.

The agency issued its statement just four weeks later — a much quicker turnaround many other recent rulings from the agency.

What’s more, the DeSantis administration’s decision flies of the face of a recent appellate court ruling that found another type of heated tobacco product — hookah — is taxable under current law.

For instance, when the Division of Alcoholic Beverages and Tobacco ruled that IQOS products aren’t taxable under current law, the agency based the decision in part on the notion that inhaling nicotine-filled aerosol from a “heatstick” isn’t the same thing as smoking because it does not produce any visible smoke.

“Use of IQOS does not result in the creation of any ‘visible smoke, fumes, or gaseous product’ that would commonly be understood as ‘smoke’ or a ‘smoking’ byproduct,” division director Jerome Worley wrote in the 12-page ruling. “Instead, IQOS use involves the direct inhalation of a non-smoke aerosol.”

But Florida’s First District Court of Appeal had already ruled that Florida’s tobacco taxes are intended to cover a range of products that deliver hits of nicotine — and that the commonly understood definition of smoking includes using products that “involve the use of heat as an activity to get the nicotine into a gaseous state and facilitate quick absorption into the bloodstream.”

“If the loose tobacco is prepared and distributed so it can be used for smoking the more general sense,” Judge Adam Tanenbaum wrote in the Feb. 25 opinion, “then it is subject to the charge and tax, even if it can also be heated in other ways — without any cloud of smoke — to vaporize the nicotine.”

But it may not matter that the DeSantis’ administration’s decision in favor of Philip Morris conflicts with the First DCA’s ruling, which went against a company called Global Hookah. That’s because it’s not clear that anyone can or will challenge the new position of the Division of Alcoholic Beverages and Tobacco.

“Ultimately, while this declaratory statement may be based on distinctions that may not make a difference under the First DCA’s Global Hookah opinion, because ABT administers the tax on tobacco products itself and does not intend to tax the IQOS, any challenge to the taxability of the product or the declaratory statement itself is unlikely,” Daniel McGinn, an attorney in the Tallahassee office of Jones Walker, wrote last week in a note about the IQOS decision.

The DeSantis administration’s stance on IQOS could also help Philip Morris convince state legislators to make a permanent change to state law. Supporters can now plausibly claim that exempting heated tobacco products from tobacco taxes won’t cost the state any lost revenue — since the administration just made clear that it doesn’t intend to collect the tax anyway.

Philip Morris already has plenty of friends to the Florida Legislature. One of the company’s bills (Senate Bill 1418) sailed through the Senate Regulated Industries Committee last week on a unanimous vote. Another (House Bill 785) cleared the House Ways & Means Committee by a 17-1 margin.

The company has been a generous donor to some lawmakers, too. While comprehensive records for the first quarter of 2025 are not yet available, individual lawmaker records show that Philip Morris gave $15,000 in January to Rep. Sam Garrison (R-Fleming Island), who will become speaker of the state House after the 2026 elections. The company also gave $7,500 in January to Rep. Jennifer Canady (R-Lakeland), who should become House speaker after Garrison.

Some lawmakers are uncritically swallowing Philip Morris’ claims that IQOS and other heated-tobacco products would promote public health by giving smokers of traditional cigarettes a new alternative. It’s an argument often made in public through “think tanks” like the James Madison Institute that have taken Big Tobacco cash.

“We have a product that is going to help folks quit smoking,” Sen. Nick DiCeglie (R-Indian Rocks Beach) told fellow senators last week.

But groups like the American Heart Association, American Lung Association, and the American Cancer Society aren’t buying it.

The Cancer Society, for instance, says heated tobacco products are still dangerous. The products contain more than 20 toxic chemicals and have already shown health risks — including increased blood pressure, cardiovascular stress and lung inflammation — in short-term studies.

The products have also been aggressively marketed at young people rather than solely at existing smokers. Philip Morris had to suspend a social media campaign for IQOS after Reuters exposed its use of young ‘influencers.’

Anti-tobacco advocates say that IQOS and other heated products should be taxed just the same as cigarettes. They also say the devices should be prohibited in any place where smoking is not permitted. And they say flavored options should be banned entirely.

The truth is there is still a lot we don’t know about the long-term health effects of heated tobacco use.

And maybe — just maybe — Florida’s elected leaders ought not trust any rosy public health claims peddled by a company whose business model is built around addicting people to a drug — and that has a long, well-documeted history of lying about the danger of its products.