PREPARED BY: John Wiemer
LB 712 DATE PREPARED: April 07, 2025
PHONE: 402-471-0051
Revision: 01
Revised per Updated DOR Response FISCAL NOTE
LEGISLATIVE FISCAL ANALYST ESTIMATE
ESTIMATE OF FISCAL IMPACT – STATE AGENCIES (See narrative for political subdivision estimates)
FY 2025-26 FY 2026-27
EXPENDITURES REVENUE EXPENDITURES REVENUE
GENERAL FUNDS $12,600 $10,754,000 $16,615,000
CASH FUNDS
FEDERAL FUNDS
OTHER FUNDS
TOTAL FUNDS $12,600 $10,754,000 $16,615,000
Any Fiscal Notes received from state agencies and political subdivisions are attached following the Legislative Fiscal Analyst Estimate.
This fiscal note has been updated to reflect a revised response from the Department of Revenue (DOR) , which also now includes
calculations based on actual data for the first year of the tax on electronic nicotine delivery systems (ENDS).
Under LB 712, the tax on ENDS is 40% of the purchase price paid by the first owner or the price at which the first owner who made,
manufactured, or fabricated the ENDS sells the item to others.
The DOR estimates the following increase to General Fund revenues as a result of the bill :
• FY26: $10,754,000
• FY27: $16,615,000
• FY28: $17,113,000
• FY29: $17,626,000
The DOR estimates minimal impact to the Highway Trust Fund and Highway Allocation Fund, which is distributed to cities and counties.
The DOR estimates a one-time programming charge of $12,600 to be paid to the Office of the Chief Information Officer (OCIO) as a
result of this bill.
There is no basis to disagree with these estimates by the DOR. LB 712 Revised Fiscal Note 2025
State Agency Estimate
State Agency Name: Department of Revenue Date Due LFO:
Approved by: James R. Kamm Date Prepared: 04/04/2025 Phone: 471-5896
FY 2025-2026 FY 2026-2027 FY 2027-2028
Expenditures Revenue Expenditures Revenue Expenditures Revenue
General Funds $12,600 $10,754,000 $16,615,000 $17,113,000
Cash Funds
Federal Funds
Other Funds
Total Funds $12,600 $10,754,000 $16,615,000 $17,113,000
Major Objects of Expenditure
25-26 26-27 27-28 25-26 26-27 27-28
Class Code Classification Title FTE FTE FTE Expenditures Expenditures Expenditures
Benefits………………………………………………………………………………………………………….
Operating Costs…………………………………………………………………………………………………. $12,600
Travel……………………………………………………………………………………………………………
Capital Outlay…………………………………………………………………………………………………...
Capital Improvements…………………………………………………………………………………………...
Total……………………………………………………………………………………………………………. $12,600
Revised due to calculations error.
LB 712 would increase the tax rate on electronic nicotine delivery systems (ENDS). Currently, ENDS products
containing three milliliters or less of consumable material is taxed at a rate of five cents per milliliter. ENDS
products containing more than three milliliters are taxed at 10% of the purchase price.
LB 712 would eliminate the discrepancy in calculating tax rate based on the amount of consumable material.
Instead, all ENDS including ENDS without consumable material would be taxed at a rate of 40% of the purchase
price.
It is estimated that LB 712 will have the following impact on the General Fund revenues :
Fiscal Year
General Fund
revenues
FY 2025-26 $ 10,754,000
FY 2026-27 $ 16,615,000
FY 2027-28 $ 17,113,000
FY 2028-29 $ 17,626,000
It is estimated that LB 712 will have minimal impact on the Highway Trust Fund and Highway Allocation Fund.
LB 712 will require a one-time programing charge of $12,600 paid to the OCIO to implement necessary changes.
The operative date for this bill is three months after the adjournment of the legislature.