Tobacco 21 Compliance in 2025: What Retailers Need to Know
To strengthen age restrictions on tobacco sales and reduce youth use of tobacco products and early addiction, the US Food and Drug Administration (FDA) introduced a new rule on September 30, 2024. The new rule builds on an existing 2019 federal law that raised the legal age of tobacco purchase to 21 from 18 and pushes compliance to the front of the line for tobacco and vape merchants.
At AllayPay, we care about our merchants, retailers, and vendors and want you to be as compliant as possible. After all, when you run brick-and-mortar shops or sell tobacco products online, you must prove compliance with every transaction. For Tobacco 21, you’ll see how we can help so that you know what to do going forward and are set up for secure, compliant transactions.
What Is Tobacco 21 and Why Is It Being Enforced Now?
According to the World Health Organization (WHO), there are 1.25 billion tobacco users worldwide who are aged 15 and older. With so many people using tobacco, some healthcare experts have called nicotine use a public health concern.
The US government felt more needed to be done regarding tobacco use and decreasing underage tobacco sales, which led to the passing of Tobacco 21.
This law prevents merchants from selling tobacco to those under the minimum age of 21 in hopes that the nation’s youth will be protected against the health concerns associated with tobacco use.
This federal and state law passed with immediate effect, and the increased age of sale applies to all 50 states. Tobacco 21 applies to all tobacco products, including e-cigarettes or electronic nicotine delivery systems, e-liquids, and:
- Cigars
- Pipe tobacco
- Cigarettes
- Synthetic nicotine products
- Smokeless tobacco
- Hookah or waterpipe tobacco
Since its passing, the FDA has completed over 1.5 million retailer compliance checks on tobacco sales and issued thousands of warnings for violations. Along with AllayPay’s tools, merchants can use the “This is Our Watch” program for free resources and convenient tools like an FDA age calculator app and a digital age verification Calendar to remain compliant.
What Changed on September 30, 2024, Regarding Tobacco Use?
Three main regulations were changed with the law that passed. We recommend you keep the following in mind as a tobacco merchant:
- Anyone under the age of 30 who is trying to buy tobacco products needs to have their age verified with unexpired photo identification.
- Facilities where individuals under the age of 21 are present or permitted to enter at any time cannot sell tobacco products via vending machines.
- If a facility accommodates individuals under 21 at any given time, cigarettes and smokeless tobacco cannot be sold via self-service displays.
In addition to the above, several states implemented stronger enforcement policies. For example:
- Undercover buys and surprise compliance checks.
- Higher penalties for underage sales with fines of up to $5,000 per violation in some states.
- Stricter license enforcement with merchants at risk of suspension or revocation for selling to underage individuals.
- POS system mandates requiring age prompts or product-level controls.
- Expanded ID requirements, including scannable ID tech in certain jurisdictions.
These policies are still being rolled out in some places, but the fact of the matter remains: if you sell tobacco or vape products, you’re expected to prove compliance in real time.
Which Businesses Are Impacted?
Any merchant involved in selling or distributing tobacco and nicotine products is affected by it. This means that if you’re a:
- Convenience store
- Liquor or smoke retailer
- Gas station
- Online retailer with national or cross-border sales
You need to comply with Tobacco 21. Additionally, if you’re using a payment processor or point-of-sale (POS) system that doesn’t support age-restricted product workflows or ID verification triggers, you could be exposed to legal risk, even without realizing it. At AllayPay, we don’t want our customers to face legal woes, which is why we offer dependable payment solutions with age verification capabilities.
What Retailers Must Do to Comply
We understand that adjusting to the new minimum age requirements in Tobacco 21 can be challenging. If you’re unsure what to do to comply, we’ve got you covered. Below, you’ll learn more about how to use the new enforcement climate:
Confirm Your ID Verification Workflow
You must ensure every product you sell containing tobacco or nicotine triggers a point-of-sale age check. You also need to ensure your workers follow through on verifying ages every time.
Audit Your POS or E-commerce Checkout System
You must ensure your e-commerce checkout system or POS flags regulated SKUs and blocks non-compliant sales. It also needs to provide transaction records that show when ID checks were performed. AllayPay can help you determine which POS system is right for your compliance needs.
Post Legally Required Signage
In 2025, it is now legally required by many states for retailers online and at traditional establishments to post signage indicating that tobacco cannot be sold to customers under 21.
Where AllayPay Fits In
The law is clear: underage sales are the merchant’s responsibility, not employees. This means you need to train your team accordingly and document the process so that you have proof in case of compliance checks by the FDA.
Luckily, as a business owner you can focus on your team and products when you allow AllayPay to take away the worry surrounding payment processing compliance. We’re all about ensuring businesses like yours remain compliant with the ever-evolving landscape of tobacco laws.
For regulated industries, we provide tailored and trusted tobacco point-of-sale solutions alongside high-risk merchant accounts to minimize disruptions to your workflow and reduce risk.
Some of the specific ways we can support your compliance in 2025 include:
- Built-in Age Verification Prompts: With the various POS systems that are available, we help you configure age confirmation protocols before you complete a sale of flagged items like tobacco.
- SKU-Level Transaction Controls: With these system controls, you can flag or block transactions involving specific tobacco-related SKUs unless age verification is completed.
- E-Commerce Age-Gating Integrations: Supported plug-ins and integrations that validate age before checkout for online retailers.
- Regulatory-Aligned Reporting: Detailed transaction logs and reports to help you monitor compliance and confidently respond to audits.
- Expert Support for High-Risk Merchants: We’re not in the business of solely providing payment processing solutions. Although this is something we do well, we are just as concerned with offering excellent expert support and partnering with you to keep your operations competitive and compliant in a high-risk environment.
Final Thoughts: Compliance Is Non-Negotiable, and Your Payment Processor Should Be, Too
Tobacco 21 is being enforced, and in 2025, regulatory oversight will only increase. If your business sells tobacco, vape, or nicotine products, staying compliant is non-negotiable.
The good news? You don’t have to navigate this alone. AllayPay provides reliable, regulation-ready payment processing built for your business and the unique challenges of your industry. Contact us today to learn more about our tobacco payment processing solutions.
