Vapor Voice

Tag: EU

  • Some EU Countries Want Vapes in With Tobacco Tax

    Some EU Countries Want Vapes in With Tobacco Tax

    Credit: Zerbor

    Sixteen EU countries asked the European Commission on Monday to propose a new law in the coming months on taxing tobacco in the bloc to include new products such as e-cigarettes and other vaping products – which are not covered under existing legislation.

    The initiative, led by the Netherlands, is supported by Croatia, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Latvia, Slovakia, Spain, Belgium, Bulgaria, Ireland, Slovenia, and Portugal.

    In a letter to the Commission, finance ministers from the countries say an update to the bloc’s 2011 EU tobacco taxation law is needed because – in the absence of EU regulations on vaping – each country now applies different rules and levels of excise tax, distorting the bloc’s single market.

    “Based on the current directive, most of these products cannot be taxed like traditional tobacco products. The provisions of the current directive are insufficient or too narrow to meet the challenges faced by the administrations of Member States given the ever-evolving offerings of the tobacco industry,” said the joint letter, seen by Reuters.

    “Due to shortcomings in the EU legislation, Member States have taken appropriate actions at the national level. This has led to fragmentation, an uneven playing field and, ultimately, to the distortion of our internal market,” it said.

    An update to the EU tobacco taxation law was due at the end of 2022, but has been delayed and governments want the new Commission, which took office on Dec. 1 for the next five years, to address this urgently.

  • EU Resolution to Ban Vaping in Public Places

    EU Resolution to Ban Vaping in Public Places

    VV Archive

    Several MEPs are finalizing their draft joint resolution on smoke- and aerosol-free environments. The topic will be debated in plenary on Wednesday (November 27), and the text will be put to a vote in the European Parliament the following day.

    According to the document, seen by Euractiv, MEPs primarily aim to urge member states to “extend public smoking bans to new and emerging products such as heated tobacco, e-cigarettes, and other aerosol-emitting products.”

    The draft resolution proposes extending smoking and aerosol use bans to key outdoor areas, including outdoor restaurants and cafés, workplaces, the surroundings of healthcare facilities, educational institutions, care facilities, and public transport, including bus and tram stops, and train stations.

    Railway platforms, airports, recreational areas, and other areas of high congregation would also fall under the scope of these restrictions.

    Furthermore, the Commission, according to the document, should conduct studies and encourage research on the risks of secondhand exposure to heated tobacco and aerosols, including those emitted by e-cigarettes.

    The document, which must still be finalised before the vote, also highlights the need to combat the sale of black-market vaping products. According to the draft resolution, “the Commission and member states should commit to taking stricter measures.”

  • UK Sets Out Vaping Tax, Tobacco Duty in Budget

    UK Sets Out Vaping Tax, Tobacco Duty in Budget

    VV Archives

    The cost of vaping and smoking will increase following tax rises announced in Chancellor Rachel Reeves’ Budget. A new tax on vapes of £2.20 ($2.85) per 10ml of e-liquid will kick in from October 2026.

    That will be accompanied by an equivalent increase of £2.20 per 100 cigarettes in tobacco duty to “maintain the financial incentive to switch from tobacco to vaping.” Reeves also set out immediate above-inflation increases of 2 percent on tobacco and 10 percent for hand-rolled tobacco.

    In its last Budget before losing the election, the previous Conservative government said it wanted to introduce a vaping tax and set up a consultation on the changes. The consultation said the tax aimed to make vaping “less accessible to young people and non-smokers while also raising revenue for funding vital public services like the NHS.”

    It had proposed different levels of tax based on the amount of nicotine in the vaping liquid, according to media reports. However, Reeves has instead opted for a flat rate. In its analysis of responses to the vaping consultation, the government said industry representatives and some public health bodies had opposed a three-tier structure, warning it could result in unintended consequences and create complex bureaucracy.

    Head of the UK Vaping Industry Association, John Dunne, called the vape tax a “nonsensical move” that penalized people who used vapes as a method to give up smoking. “Some three million adults are former smokers thanks to vaping, which is strongly evidenced as the most effective way to quit conventional cigarettes, saving the NHS millions of pounds in treating patients with smoking-related conditions,” he said.

    The new Labour government had already said it wanted to stop vapes being branded to appeal to children and has announced a ban on single-use vapes, due to come into effect in England in June 2025. Ministers have also pledged to continue plans set out by former Prime Minister Rishi Sunak to ban people born in or after 2009 from buying cigarettes.

  • European Elections Could Impact Support of Vaping

    European Elections Could Impact Support of Vaping

    Credit: Savvapanf Photo

    Elections in several European countries could affect support of reduced-risk nicotine products like e-cigarettes, according to Tamarind Intelligence Policy Radar research.

    Governments in Europe are the most likely to officially support reduced-risk products.

    According to Tamarind Intelligence, forthcoming elections in Finland, Spain, Ireland and the Czech Republic as well as elections for the European Parliament could be significant in determining the future of the products.

    “Our analysis of official attitudes toward e-cigarettes and other tobacco harm reduction products shows some clear global trends,” said Tamarind Intelligence Editorial Director Barnaby Page. “For example, European countries tend to have more favorable attitudes while Asian countries tend to be much more polarized.

    “However, the laws in this area can change very rapidly—sometimes because government itself changes or at other times because issues such as underage vaping or the environmental impact of disposable vapes come into the spotlight.”

    Researchers expect worldwide regulation of reduced-risk products to become stricter, especially in upper-middle-income and high-income countries. Flavored products are expected to receive the most attention with countries proposing bans on the products.

  • Proposed EU Vape Tax Needs to be Done Properly

    Proposed EU Vape Tax Needs to be Done Properly

    Unless properly structured, Europe’s tobacco and vapor tax plans may not achieve their public health objectives.

    By Stefanie Rossel

    The European Commission’s (EC) December 2022 proposal for an update to the 2011 EU tobacco excise directive came with a first: In addition to a significant hike in cigarette excise rates, the draft also calls for a bloc-wide vaping levy.

    According to the proposal, the current minimum EU excise tax rate of €1.80 ($1.92) should increase to €3.60 per pack of 20 cigarettes. This would double excise duties in member states with low cigarette taxes (in eastern European countries, a pack of cigarettes can currently sell for under €3) and affect excise duties in countries such as Luxembourg and Austria, where cigarette prices are low relative to income. The EU hopes to generate an additional €9.3 billion in revenue from the tax harmonization, which would be a welcome windfall for pandemic-struck and inflation-struck member states. If enacted, the proposal would also increase taxes on hand-rolled tobacco.

    E-cigarettes with less than 15 mg of nicotine per milliliter of liquid would attract a 20 percent excise duty, and stronger products would be subject to a duty of at least 40 percent. In the EU, nicotine content of e-liquids is limited to 20 mg per milliliter. According to the draft proposal, heated-tobacco products (HTPs) would attract a 55 percent excise duty, or a tax of €91 per 1,000 items sold.

    The proposed legislation would harmonize the fragmented EU vapor market, where each member state taxes vapor and HTP products at its own rates. It is part of a push aimed at accelerating the reduction of smoking rates throughout the EU. As part of the common market’s Beating Cancer Plan, introduced by the EC in February 2021, health officials seek to lower the current EU smoking prevalence of 26 percent to 20 percent by 2025 and achieve a “tobacco-free generation”—that is, a smoking rate of below 5 percent—by 2040.

    The draft was released only weeks after the EC imposed a ban on flavored HTPs to cut the growth in demand among younger consumers. Responses were mixed. While some argued that union-wide taxes are necessary because less harmful products still present risk, tobacco harm reduction advocates warned for unintended consequences.

    Too High, Too Complex

    David Sweanor

    “Simply increasing cigarette taxes is a blunt instrument when trying to reduce the health toll from cigarette smoking,” says David Sweanor, adjunct professor of law at the University of Ottawa in Canada. “It is far more powerful than other standard anti-smoking measures but has limitations and constraints that are often overlooked. Price sensitivity is real, but many people who smoke cigarettes will seek to deal with increased costs through access to contraband, the cross-border trade, simply changing the way they smoke without achieving health improvements, or further diminishing their overall well-being by redirecting expenditures from healthier purchases to the purchase of cigarettes.”

    Taxing low-risk alternatives reduces the incentive to switch from cigarettes and can make illicit cigarettes more competitive, according to Sweanor. In his view, it is akin to making alcoholics who give up drinking by taking up jogging pay a tax on running shoes. “It misses the point of how taxes can be justified due to the relative health impact of certain behaviors,” he says.

    Dustin Dahlmann

    Dustin Dahlmann, president of the Independent European Vape Alliance, believes that EU policy should be guided by scientific evidence. “Science around the world agrees that vaping is significantly less harmful than smoking,” he says. “E-cigarette taxes that are too high [to] prevent socially disadvantaged groups in particular from switching to e-cigarettes. In the first instance, there should not be excise duties for electronic cigarettes, as they are a means for smokers to switch to less harmful alternatives. If further harmonization of excise duties is considered, legislators should take into account the significant differences in risk profile between tobacco cigarettes and electronic cigarettes and apply the excise duties methodology accordingly, i.e., proportionality to the harm reduction benefits brought about by tobacco replacement products.”

    In practice, this would mean a maximum excise duty of €1 per 10 mL or €0.10 per 1 mL of e-liquid, and it should be applied only to e-liquids with nicotine, according to Dahlmann. “The EU draft imposes a combination of an ad valorem and a specific volume base excise that would be an administrative burden for small and medium enterprises and fiscal authorities due to the additional complexity. Giving two options will lead to uncertainty, defeating the purpose of a harmonization of excise rates.”

    Illicit Trade Could Increase

    The question about how the EU’s revised tobacco tax directive would impact the illicit cigarette market is justified. The experience of France provides a cautionary tale. Following a tax increase of almost three times the EC’s minimum level, the illicit market in that country more than doubled, from 13.7 percent in 2017 to 29.4 percent in 2021, leading to an estimated loss of €6.2 billion in tax revenues in 2021, according to a KPMG report. In general, the study found, illicit consumption in the EU increased by 3.9 percent, or 1.3 billion cigarettes, in 2021, which corresponds to a loss of €10.4 billion in taxes.

    How the suggested excise duty increase would impact markets with relatively low income and high smoking levels, such as Greece (42 percent smoking prevalence) and Bulgaria (38 percent), is anybody’s guess. “I have worked globally on illicit trade issues for decades,” says Sweanor. “There is much we can do to limit the trade, but the economics makes [illicit cigarette trade] so lucrative that it is hard to imagine bringing it under control so long as there remains a significant market for cigarettes. Markets meet needs, including illicitly. Cigarettes are extraordinarily inexpensive to make, and taxes and the huge profit margins of Big Tobacco create a business opportunity many people can be expected to see as a money spinner. The real answer is to facilitate disruptive technology that makes cigarettes as undesirable to consumers as unsanitary food or leaded petrol.”

    To achieve the latter, the EC would have to acknowledge the harm reduction and smoking cessation potential of novel tobacco products. In February 2022, the EU Parliament became the world’s first elected chamber to endorse THR when it adopted a resolution on cancer prevention and treatment that notes that e-cigarettes “could allow some smokers to progressively quit smoking.” Dahlmann praised the move as a “landmark declaration” that would help reassure smokers of the benefits of switching to vaping. “All other EU institutions—and in particular the European Commission—should take this on board and ensure that policy follows science, not the other way around,” he said at the time.

    Sweanor is less upbeat. “The taxation of low-risk products reflects an understanding of differential risks. But it fails to come to terms with the full magnitude of the harm from cigarette smoking and the enormous potential to dramatically reduce it. When we are looking at hundreds of thousands of annual deaths, surely it is a public health emergency—and policies should reflect that. Language such as “could allow some smokers…” and policies that limit the relative acceptability of low-risk alternatives indicate that the extent of the public health opportunity is not fully grasped.”

    Differentiated Approach Required

    Whether the EU is prepared to part ways with anti-novel nicotine product sentiment of the World Health Organization Framework Convention on Tobacco Control (FCTC), which the common market has ratified, remains to be seen.

    “The EU is obligated to support tobacco harm reduction as a signatory to the WHO’s FCTC as stipulated in the introduction, article 1 (d) of the treaty,” says Dahlmann. “The FCTC requires the EU to not only allow reduced-risk products but to actively promote them. However, this definition is not actively supported by the WHO. The rule here is much more ‘quit or die.’”

    “The WHO’s FCTC process has followed in the footsteps of narcotics protocols in being hijacked by ideologues who seek an abstinence-only approach on drugs where total abstinence is simply not a viable nor a humane goal,” Sweanor adds. “As with those narcotics protocols, caring governments that follow the Enlightenment principles of science, reason and humanism will either creatively skirt such guidelines or simply ignore them. This is something we are now seeing unfolding globally with cannabis policies.”

    The goal of the new tax directive to create a smoke-free European society, he says, is noble and achievable—and far more quickly than envisioned in that 2040 goal. “But it requires bold rather than tentative steps. Policymakers should act in ways consistent with cigarette smoking being a public health crisis of enormous importance,” says Sweanor. “The best way to tackle this is by use of cross-elasticities, of empowering and facilitating people who smoke cigarettes to make healthier choices. This is accomplished by measures such as the widest possible cost differential between lethal cigarettes and low-risk alternatives. Given the horrendous death and disease tool from cigarettes, this should be a huge priority.”

    “E-cigarettes need to remain accessible and affordable to smokers from all socioeconomic backgrounds who wish to quit smoking,” says Dahlmann. “E-cigarettes offer smokers an alternative that is 95 percent less harmful than smoking. Switching from tobacco to vapor has positive individual, social and economic implications and should be encouraged, not penalized by the tax system. If taxes make vaping more expensive than smoking, many smokers will lose an incentive to switch to the much less harmful alternative. We therefore would see no chance of achieving the EU’s ambitious goals.”

    Before it is enshrined in law, the proposal will have to be agreed on by all EU member states. BAT already noted that this is merely the beginning of a long legislative process. “I assume there will be amendments, but we do not yet know their likely nature,” says Sweanor. “The proposal could be changed to help facilitate a rapid public health breakthrough as people abandon lethal cigarettes in huge numbers. Or it could be amended to make that a pipe dream.”

    This article first appeared in Vapor Voice‘s sister publication Tobacco Reporter.

    Stefanie Rossel is Tobacco Reporter’s editorial contributor. An experienced trade journalist, she combines sharp reporting skills with in-depth knowledge of the tobacco and vapor industries. Prior to joining Tobacco Reporter, Stefanie was editor-in-chief at Tobacco Journal International, where she worked for a decade. Fluent in English, German and French, Stefanie covers tobacco news around the world. She is based in Germany.
  • Consumer Group Denounces EU Vape Tax Proposal

    Consumer Group Denounces EU Vape Tax Proposal

    The World Vapers’ Alliance (WVA) has denounced the EU’s leaked plan to increase vaping taxes, according to the U.K. Vaping Industry Association.

    “The [EU] Commission claims that higher taxes will improve public health, but the reality is the exact opposite,” said WVA Director Michael Landl. “A less harmful alternative, such as vaping, must be affordable for ordinary smokers trying to quit cigarettes. If the commission wants to reduce the burden of smoking on public health, they must make vaping more affordable and accessible, not less.

    “High taxes hit the least advantaged people most. In times of multiple crises and people struggling to make ends meet, making vaping more expensive is the opposite of what we need. Policymakers must understand that tax increases on vaping will force people back to smoking or the black market, a scenario nobody wants. In times of crisis, people shouldn’t be further punished by an unscientific and ideological fight against vaping. This must be stopped,” said Landl.

    “Rather than fighting vaping, the EU finally must embrace tobacco harm reduction. What we need is risk-based regulation. Vaping is 95 percent less harmful than smoking and, therefore, must not be treated the same way as conventional smoking,” added Landl.

  • Brussels to Propose First EU-Wide Vaping Levy

    Brussels to Propose First EU-Wide Vaping Levy

    In a long-anticipated move, the European Union is to propose a bloc-wide vaping tax policy as part of a shake-up of levies on the tobacco industry. The new rules would also double excise duties in member states with low cigarette taxes, according to a draft European Commission document.

    The update to the 2011 EU tobacco taxation directive will tax novel smoking products, such as e-cigarettes, vapes and heated tobacco, comparatively with combustible cigarettes as policymakers worldwide take an increasingly dim view of the new products’ popularity among young people.

    Products with a high nicotine content would have an excise duty of at least 40 percent applied to them, while lower-strength vapes will face a 20 percent duty. Heated tobacco products will also be hit by 55 percent duty, or a tax rate of €91 per 1,000 items sold.

    The changes to legislation, part of a push by Brussels to cut smoking rates, will increase the EU’s minimum excise duty on cigarettes from €1.80 to €3.60 per pack of 20, which would raise prices in eastern European nations where packs can sell for under €3.

    Alberto Alemanno, professor of EU law at HEC Paris business school, told the Financial Times that the absence of an EU-wide excise framework for vaping and heated tobacco products had been “weakening tobacco control efforts” across the bloc.

    Excise duties on cigarettes would also increase considerably in countries such as Austria and Luxembourg where prices are low relative to income. The tax rise on cigarettes is expected to generate an extra €9.3 billion for EU member states.

    The changes aim to speed up the EU’s push for a “tobacco-free generation” by 2040. As part of the EU’s Beating Cancer Plan, health officials want to drive tobacco use among EU citizens from the current level of about 25 percent down to 20 percent in 2025, and below 5 percent by 2040.

    The commission this month imposed a ban on flavored heated tobacco products to curtail a surge in demand among younger consumers. In the U.S., regulators at the Food and Drug Administration have moved to ban popular vaping products, such as Juul.

    Peter van der Mark, secretary-general of the European Smoking Tobacco Association, an industry body, warned that “if you have a sudden very steep increase, you can create a market for illicit trade.” Dustin Dahlmann, president of the Independent European Vape Alliance, added that imposing taxes on novel tobacco products could lead to “the much less harmful alternatives” to smoking being “taxed far too heavily in many countries.”

    A leaked impact assessment said that the increase in the minimum excise duty would have “a strong impact on consumers and economic operators” in EU states where cigarette prices were low, including Bulgaria, Slovakia, Poland and Hungary. The assessment also noted that the excise duty on novel tobacco products “which are particularly appealing to young people, who are at risk of developing addiction” would aid public health efforts to cut tobacco use.

    The proposal will have to be agreed by all EU member states before it is enshrined in law. British American Tobacco, one of the world’s biggest cigarette manufacturers, stressed this was “the beginning of a long legislative process.”

  • EU Poll Finds Support for Smoke-Free Technologies

    EU Poll Finds Support for Smoke-Free Technologies

    Photo: trodler1

    Smoke-free technologies should complement the EU’s existing tobacco control measures, according to participants in a survey commissioned by Philip Morris International, according to Eureporter.

    Carried out Nov. 10-15 by Povaddo and presented in Brussels on Nov. 17, the poll surveyed 13,000 adults spread over 13 European countries.

    Among the participants, 73 percent said that industries should be incentivized to develop innovative products that are better for consumers and the environment. Sixty-nine percent said interested adult smokers should be encouraged to switch to scientifically substantiated, smoke-free alternatives by taxing these products at rates that are lower than cigarettes but high enough to deter youth and nonsmokers. Additionally, six in ten respondents agreed that government endorsement of innovative tobacco products would have a positive impact on smokers.

    “We know the potential to do better for adult smokers exists, as several member states have carried out similar policy approaches in, among others, energy, cars and alcohol,” said PMI Senior Vice President for External Affairs Grégoire Verdeaux during the presentation of the survey results.

    “Pragmatic policies have the power to improve people’s lives, incentivizing companies to innovate for the better and provide equitable access to technological advances, especially in a time of economic instability.”

    Povaddo Research President William Stewart said he hoped the results would encourage EU and national authorities to assess the results of current policies and consider other approaches, including “sensible regulation and taxation, while creating an environment that fosters innovations.”

  • Looking Back: SHEER Report ‘Fundamentally Flawed’

    Looking Back: SHEER Report ‘Fundamentally Flawed’

    A scientific report on e-cigarettes prepared for the European is fundamentally flawed, according to the Independent European Vape Alliance (IEVA).

    As part of the European Commission’s forthcoming review of the Tobacco Products Directive, the Scientific Committee on Health, Environmental and Emerging Risks (SCHEER) Committee was tasked with producing a scientific review of the health effects of e-cigarettes. On Sept. 23, SHEER adopted its preliminary opinion. The public consultation on the preliminary opinion closed on Oct. 26.

    “While we welcome the initiative from the European Commission in taking a view on the science of electronic cigarettes, the draft report it has produced is fundamentally flawed,” IEVA wrote. “What is most striking about the draft scientific review is its failure to compare the risks of electronic cigarette use with the risks of smoking.”

    In its response to the preliminary opinion, IEVA cited several areas of concern:

    • The Committee has concluded that there is insufficient evidence that e-cigarettes are not a useful tool for smokers seeking alternatives, despite quoting two randomized control trials stating precisely the opposite.
    • In its risk assessment, the Committee has not taken a risk-based approach at all, but rather a hazard-based approach. It states the potential risks of using e-cigarettes without even attempting to compare these with the risks from cigarette smoking, which are exponentially higher.
    • The Committee has concluded that there is strong evidence that e-cigarettes act as a “gateway” to smoking. However, it has done so based almost exclusively on data from the United States, where an entirely different regulatory regime exists. The Committee also fails to acknowledge that smoking among young people has declined significantly: if vaping leads to smoking, then why are there not more smokers observed during the period where the e-cigarette market grew rapidly?

    According to IEVA, the poorly founded conclusions undermine the utility of the report as a document upon which EU decisionmakers can make policy decisions in the best interests of Europeans.

    Earlier this week, British American Tobacco voiced similar concerns about the SHEER report.

  • Juul Labs to Exit South Korea, 5 EU Markets

    Juul Labs to Exit South Korea, 5 EU Markets

    Juul Labs said today it would end operations in South Korea, a year after it entered the market. The company states the cause was its inability to gain market share amid government health warnings.

    In a statement, Juul Labs stated that since the beginning of the year it was working through a restructuring process aimed a re-establishing a viable business in South Korea by significantly reducing costs and making changes to its products.

    “However, these innovations will not be available as anticipated,” the statement said. “As a result, we intend to cease our operations in South Korea.”

    In October last year, South Korea’s health ministry advised people to stop vaping because of growing health concerns, especially after a case of pneumonia was reported in a 30-year-old e-cigarette user that month, according to Reuters news article.

    The announcement prompted convenience store chains and duty free shops to suspend the sale of flavored liquid e-cigarettes, including those made by Juul Labs.

    In December, South Korean health authorities said they had found vitamin E acetate, which may be linked to lung illnesses, in some liquid e-cigarette products made by Juul Labs, but the company denied using the material, according to Reuters.

    Juul Labs launched a product portfolio that was specifically developed for the Korean market in May 2019, but “our performance has not met expectations in terms of meeting the needs of our Korean adult smokers to successfully transition from combustible cigarettes,” according to the statement. “We have learned through this process and are focused on innovating our product portfolio.”

    Juul Labs is also reportedly ready to withdraw from a handful of EU markets as well, claiming the regulatory environment has become overly hostile to the device.

    According to BuzzFeed News, Juul will soon remove its products from shelves in Austria, Belgium, Portugal, France, and Spain.

    The news outlet reports the European Union’s strict requirement that e-cigs contain no more than 20 milligrams of nicotine makes it difficult for Juul to do business there.

    Austria, Belgium, and Portugal are very small markets for Juul, but the leading e-cig manufacturer generates significant sales from France and Spain. It will exit France by the end of the year, but withdraw from the other countries in July, paring its presence in global markets to a narrow selection that includes Germany, Italy, Russia, and the U.K.