Nigel Farage tweeted he is “appalled” to learn the EU plans to tax e-cigarettes at the same levels as tobacco. On this basis, the UKIP leader concludes, “All vapers must vote to Leave EU!”
Appalled that EU set to tax e-cigarettes at same levels as tobacco. All vapers must vote to Leave EU! https://t.co/6HrvCIyYL4
— Nigel Farage (@Nigel_Farage) March 2, 2016
Other Brexiteers voiced outrage at the suggestion e-cigarette products might face excise duty of 57%, on top of the 20% VAT already paid. Vote Leave noted that the tax hike was at odds with Public Health England recommending e-cigarettes to the NHS.
What’s the source?
The story originated in a Times article, with Leave campaigners also linking to a later version in the Daily Mail. The Times said e-cigarettes were “set to soar in price” and that “vaping will be brought in line with cigarettes and cigars”. Lower down, however, the piece spoke of the “first steps” in a review and said “officials will now decide what level of excise duty should apply to them”.
It was telling that the Daily Mail, having published a similarly sensational story, later toned down its article. It admitted taxes might not be “identical” to tobacco products, linked to a more objective piece in the EU Observer and changed the words “set to” to “could” in its headline.
What actually are the EU’s plans?
InFacts contacted the European Commission, which said the Times article was “incorrect” and there were “absolutely no plans at this stage to introduce excise duty for e-cigarettes. Nor has there been any suggestion that e-cigarettes would be taxed at the same level as cigarettes.”
Neither is the Commission the driving force behind this review. As the Times pointed out, it was initiated by members of Coreper – ambassadors from each of the 28 member states. And should a change in tax be proposed, it would require the unanimous support of all EU governments.
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The Commission said it must also include “an impact assessment, a public consultation and carry out a lot more technical work” before conclusions are made. These will consider the public health implications of raising the price of e-cigarettes and the long-term budgetary implications of tax-free vapes; the threat of national taxes on e-cigarettes could undermine the EU’s internal market (4.2).
£100 for an e-cig?
The Times included a table of possible price rises if e-cigarettes were taxed at the same levels as cigarettes. Brexit campaigners posted the table via social media.
.@thetimes showing the price hikes about to hit vapers thanks to raise in taxes imposed by the EU (@Vapers4Britain) pic.twitter.com/Wi1AZ9KaUE
— Liberal Youth Leave (@LY4Leave) March 2, 2016
The Times reckons users could end up paying as much as £100 for a “box mod” – a large type of vaping device. But going by the experience of the US, the suggestion that specific devices could be taxed as highly as cigarettes seems somewhat fanciful. With the exception of Minnesota, US states tend to tax only the nicotine liquid rather than the whole device. That makes the Times’s price predictions, while not inconceivable, rather unlikely.
Edited by Alan Wheatley
This is disingenuous, to say the least. Firstly, after the shenanigans surrounding the EU’s Tobacco Products Directive, the chances of e-cigarette users ever believing a word the Commission says are precisely nil. Secondly, the aforementioned TPD classes every component of an e-cigarette as a “tobacco product” despite them not actually containing any tobacco. So if excise duty is imposed it’s likely to be on everything. The references to what’s been done in the USA are irrelevant.
“The Commission said it must also include “an impact assessment, a public consultation and carry out a lot more technical work” before conclusions are made.”
That’s what they said about including e-cigs in the Tobacco Products Directive as well. Except, oops, they were lying!
That’s all very well – but there are plans to keep a very close eye on the sales of e-cigs, and to tax them should they take off.
https://pbs.twimg.com/media/CcqaEosW8AAEisl.jpg:large
This seems quite staggering. E-cigs are, to all *reputable* evidence (god knows, there’s plenty of deeply flawed studies out there, including ones that show basic lack of numeracy, yet still get parroted by the press), significantly less harmful than lit tobacco, have effectively zero short term risks, and the long term risks, while unknown, appear to be minimal at best, and compared to lit tobacco (users of which are almost exclusively the only users) are effectively not worth worrying about, compared to 1 in 2 deaths being caused by their combustion based forefathers.
So why on gods green earth do they want to *investigate* taxing them beyond the standard VAT for luxury goods, which by nature, would be a punitive tax? That would only harm the poorest in society, who statistically are at *far* greater risk of smoking related illnesses because *more of them smoke*.
The irony of it is, that member states plumb millions of pounds/Euros year into smoking cessation services and electric cigarettes, with no backing or promotion from governments, are basically taking over that market.
Article 20 of the TDP is another good reason to question the EUs competency; in the UK, manufacturers of vaping liquids face questionable charges based on specious reasoning for the extensive testing and approval of liquids they produce; some companies have dozens of flavours, in multiple nicotine strengths. Lets say, 24 flavours, four strengths. That’s 96 tests, at £200 a pop*. That’s £19,200. And they also have to wait six months before they can put those on the market. For an established operation, that can be done in the proposed ‘grandfather’ period between May 2016 and May 2017, but beyond that, no new company will be able to afford to start up with these regulations in place.
*Denmark, I hear tonight, are talking about charging £4000 per test – yes, four thousand pounds. Goodbye marketplace, as they are also proposing banning internet sales, and aren’t having a grandfather period for existing devices. How this can be described as fair and reasonable regulation I’ll never understand.
You can argue safety on this front (although some would suggest that the testing is over the top – I’m not in a position to comment on that) but lets take another example – the 20mg nicotine limit, 10ml bottle size limit and 2ml tank limit.
This is, apparently, for safety to help prevent nicotine poisoning. Of which there have been, in ten years, a handful of reported cases, all of which resulted in nausea. No-one – ever – has died as a result of consuming e-liquid. Yet, here we have restrictions on the higher strengths which most smokers *need* to get the same level of satisfaction as they did from a cigarette, this vastly reducing the chances that they will stick with it – especially if punitive taxes are imposed, and cause a basic kit that works well (not a CE4/cigalike – something *good*) that costs £30 nominally, to cost £50+.
For large parts of the e-cigarette related regulations, there is very little evidence to back up the massively sweeping regulations being put in place, and for other parts – such as a 2ml limit to the tanks – there seems no sensible rationale for what they are demanding other than inconveniencing the end user. And lets not even begin on the ‘leak free refilling’ which is demanded, but the definition of ‘leak free’ was never explained. I can fill a tank without leaks using a snipe nosed bottle – does that count?
But in the UK, despite my protestations above, we are getting off extremely lightly. We can still, for example, buy e-cigarettes and supplies online, and the leak free refilling doesn’t apply to us. Other countries are banning this outright and gold plating the entire thing. Which is utter insanity and will completely destroy the market for everyone other than the very biggest players – namely Big Tobacco, who are currently about eight years behind the rest of the industry, but under ;gold plated’ implementations, are the only ones who can afford to play. So the EU will be handing the market in, for example, Denmark, straight to PMI, BAT, etc. Lets have a slow hand-clap!
To recap, as I’m rambling a touch now:
For decades, tobacco harm reduction has been the core of public health.
The last decade of e-cig use has done more in ten years than public health has managed in forty.
The next decade will be a huge retrograde step, and in many parts of the EU, will result in a completely unregulated black market of liquids with dodgy nicotine contents, badly made tanks that will risk shorting and pumping 100W+ to the users mouth, and basically, the whole market going tits up. Those that do comply with the regs will be big tobacco owned as they are the only ones who can afford to put expensive, substandard (in terms of experience) equipment to market.
Until a few months ago, I was arguing with people about conflating e-cig regulation with the EU referendum – I’ve always been very pro-EU.
I’m not very much on the fence. All from one market that affects me being tampered with to a gobsmackingly incompetent degree by the desperately ill-informed, who are the perfect example of the Dunning-Kruger effect; “a cognitive bias in which relatively unskilled persons suffer illusory superiority, mistakenly assessing their ability to be much higher than it really is.”
It seems that nobody drafting these regulations is aware of how these devices work, what their purpose is, who uses them, and how quickly the market moves.
And they are the ones with the power. And we’ve seen this before, with snus. Research The Swedish Effect (Sweden opted out of banning snus for historical reasons), and note that their smoking related mortality rates are significantly lower than anywhere else in Europe (or the industrialised world). Now, it might be coincidence, you say, but Norway also has snus. And also has a similar story to tell.
The rest of the EU? It’s banned “because tobacco product” as opposed to being based on any evidence. Sounds like e-cigs, eh?
Staggering. Anyway, rant over….
Steven R