Author: Taco Tuinstra

UK Urged to Drop Proposed Vape Tax Hike

Delon Human (Photo: Taco Tuinstra)
A plan to hike the tax on vapes in the U.K. risks undermining the country’s efforts to reduce smoking rates and would increase smoking-related death and disease, according to tobacco harm reduction advocates.
The U.K. chancellor is reportedly considering the tax increase in the state budget this month. But harm reduction specialists say any rise could drive people who smoke back to far more dangerous cigarettes.
“Vapes are proven to be 95 percent less harmful than combustible cigarettes and are helping millions of people who smoke worldwide transition to a safer option,” says Delon Human, leader of Smoke Free Sweden.
“Both Sweden and New Zealand have dramatically reduced their smoking rates in large part due to the availability and accessibility of alternative nicotine products like vapes. As a result, both countries are now on the verge of being declared smoke-free and are reaping the subsequent public health dividend.
“Any policy that limits access to these alternatives—whether through taxation or other barriers—threatens to reverse such progress.”
Sweden is poised to be the first country to become smoke-free as a result of its progressive policy approach, which includes lowering taxes on reduced-risk products while increasing taxes on more harmful cigarettes.
Compared to the rest of the European Union, Sweden has 44 percent fewer smoking-related deaths, a 41 percent lower cancer rate and 38 percent fewer deaths attributable to any cancer, notes Smoke Free Sweden
“At Smoke Free Sweden, we advocate for sensible regulations that protect adult access to safer alternatives while discouraging underage uptake,” Human said. “This includes restrictions on youth-oriented packaging and clear communication about the risks of nicotine.
“However, excessive taxation of harm reduction products is a step in the wrong direction. Rather than penalizing vapers, governments should focus on creating an environment where adults have easy access to safer alternatives and are supported in their efforts to quit smoking.
“We urge the U.K. government to reconsider this proposed tax increase and to look toward evidence-based policies that have been successful in Sweden and other progressive nations. The world now has the tools to create a healthier, smoke-free future. We must not sacrifice those tools, which are already helping millions of people quit smoking for good.”
October 22, 2024
Illicit Smokes Top 10 Percent in Cyprus

Photo: Gelia
Illegal cigarette consumption in Cyprus reached 11 percent of the total market in 2023, reports Philenews, citing a KPMG report commissioned by Philip Morris International.
Despite a slight decrease in the percentage of illegal cigarette consumption since the previous report, the government still missed out on €18 million ($19.49 million) in tax receipts due to illicit tobacco trade in 2023.
Cypriots smoked an estimated 100 million illegal cigarettes during 2023, most of which were believed to originate from the northern part of the island, where the Republic of Cyprus does not exercise control.
Outflows of illicit cigarettes from Cyprus rose by 3 percent compared to 2022, with increased outflows to smaller markets.
This increase was partially offset by reduced outflows to the United Kingdom, although it remains the primary destination for illegal cigarette outflows from Cyprus in 2023.
At the EU level, smokers consumed more than 35 billion illegal cigarettes in 2023, accounting for 8.3 percent of the trading bloc’s consumption.
Illegal cigarette consumption has been increasing for five consecutive years in Europe, reaching 52.2 billion cigarettes in the 38 countries included in the study.
EU governments lost an estimated €11.6 billion in tax revenue in 2023 compared to €11.3 billion in 2022.
The report notes that the increase in counterfeit cigarette consumption across Europe, primarily driven by the U.K. and Ukraine, is now combined with growth in all other categories of illegal trade.
The recovery of legal cross-border quantities following the lifting of Covid-19 travel restrictions in 2022 has pushed overall nondomestic consumption in the 38 European countries studied to its highest recorded level (15.5 percent), equating to more than one in six cigarettes.
October 22, 2024
Philippine Raids Net Multiple Illicit Vape Sellers

Nationwide raids in the Philippines uncovered illicit seller 408 sellers vape products, whose operations are unregistered or whose products do not carry the appropriate revenue stamps, reports Business World.
illicit retailers and resellers were found not only in metropolitan Manilla, but also in other places, including Ilocos Sur, Pangasinan and Benguet.
Beginning June 1, the BIR required all vape manufacturers and sellers to affix internal revenue stamps on their products to indicate tax compliance.
Republic Act 11900 instructs the Bureau of Internal Revenue (BIR) to order the immediate recall, ban or seizure from public sale or distribution of vaporized nicotine and non-nicotine products or novel tobacco products not registered with the BIR, including those sold online.
The BIR intends to conduct regulator raids on illegal vape sellers. “I have ordered weekly raids against illicit vape retailers, wherever they may be found,” said BIR Commissioner Romeo D. Lumagui Jr.
In the first half of the year, the BIR estimated foregone revenue of around PHP7.2 billion ($124.47 million) from seized vape and tobacco products.
October 22, 2024
Vietnam: Tobacco Damage Outweighs Earnings

Photo: Taco Tuinstra
The economic damage caused by tobacco far outweighs the revenue generated from taxes on tobacco products in Vietnam, reports VN Express.
According to statistics, the country spends about VND108 trillion ($4.28 billion), or nearly 1.5 percent of its gross domestic product, on tobacco-related healthcare every year. A study conducted by K Hospital revealed that 97 percent of lung cancer patients are tobacco users. Meanwhile, the World Health Organization reported that tobacco-related diseases account for around 104,300 deaths in Vietnam annually, including 19,000 deaths caused by secondhand smoking.
“Tobacco is placing a significant burden on both Vietnam’s economy and public health,” said Nguyen Thi Thu Huong from the Tobacco Control Fund under the Ministry of Health at a conference on Thursday.
She called for increased taxes on tobacco and the creation of more non-smoking spaces as key measures to combat the harmful effects of smoking. Vietnam currently taxes tobacco at 38.8 percent of the sale price, far below the 70 percent rate recommended by the WHO. The low tax rate makes tobacco easily accessible to young people and those with lower incomes, Huong added.
The WHO has been urging the country to implement a flat tobacco tax to reduce the number of smokers.
October 21, 2024
Philippines to Miss Tobacco Tax Goal

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The Philippines will miss its PHP362.2 billion ($6.32. billion) excise tax collection goal this year due to declining demand for tobacco products, reports Business World. Tobacco excise accounts for more than 40 percent of the country’s excise tax take, according to Jethro Sabariaga, assistant commissioner of the Bureau of Internal Revenue (BIR).
Sabariaga noted that tobacco consumption has been steadily decreasing over the past decade “You don’t see a lot of people smoking cigarettes these days. Even visually, you can confirm the shift in market demand,” Sabariaga said, adding that the collection growth in other excisable articles will not be enough to offset the decline in tobacco excise.
The public’s shift to vape products has also been affecting the bureau’s excise tax take, according to Sabariaga. A single vape product is equal to one cigarette pack in excise taxes, but vape products often take longer to consume, he said.
“So, a cigarette smoker shifting to vape, who usually consumes 10 to 15 packs of cigarettes a month, will probably just buy one vape product for the month, or worse, one for two months,” Sabariaga was quoted as saying.
The BIR has also faced challenges in collecting excise taxes due to the stubborn illicit trade in tobacco products.
In the first half of 2024, the agency lost around PHP7.2 billion in potential revenue from seized tobacco and vape products.
October 21, 2024
Austin Smokers Invited to Join IQOS Wait List

Photo: momius
Philip Morris International will hold several events in Austin, Texas, this weekend, to mark the upcoming introduction of its IQOS tobacco heating product in the United States.
In anticipation of launch, current nicotine users who are over the age of 21 and live in designated areas of Austin will be given the opportunity to join a wait list to be among the first to try IQOS once the product becomes available.
“We believe having a portfolio of satisfying alternatives can help traditional tobacco users switch completely and walk away from cigarettes for good,” said Stacey Kennedy, CEO of PMI in the U.S. operations “Austin is a hotbed for innovators, entrepreneurs and trailblazers. Cultural trends adopted here have a ripple effect, so it was a natural place to introduce IQOS in the U.S.”

Austin is a hotbed for innovators, entrepreneurs and trailblazers. Cultural trends adopted here have a ripple effect, so it was a natural place to introduce IQOS in the U.S.
Stacey Kennedy, CEO of PMI’s U.S. business
The (re)introduction of tobacco-heating products into the U.S. has been eagerly awaited by investors and tobacco harm reduction advocates, who hope the product will help transition smokers from deadly combustible cigarettes to less-harmful heating products. Tests suggest that heating tobacco produces lower levels of harmful chemicals than burning it. IQOS has been authorized by the U.S. Food and Drug Administration as a modified-risk tobacco product.
In Tobacco Reporter’s October issue, Cheryl Olson reflects on how the launch of tobacco heating products may impact the U.S. market.
IQOS was briefly test-marketed by PMI’s former U.S. partner, Altria Group. In September 2021, the International Trade Commission determined that the product infringed patents owned by British American Tobacco and barred IQOS imports.
PMI and BAT subsequently resolved their intellectual property dispute, clearing the way for IQOS sales in the U.S. In October 2022, PMI reclaimed the U.S. commercialization rights to IQOS, saying Altria had failed to meet certain milestones stipulated in their agreement.
IQOS is already available in about 80 countries, and since launching in Japan 10 years ago, it has helped more than 22 million people worldwide make the switch from cigarettes, according to PMI. A 2019 study by researchers at the American Cancer Society showed that cigarette sales decreased five times faster after IQOS was introduced in Japan.
IQOS is now PMI’s top revenue earner, surpassing the company’s bestselling Marlboro cigarette brand.
PMI’s latest integrated report shows that 38 percent of the company’s total net revenue now comes from its smoke-free business, which also includes the popular Zyn nicotine pouches .
“For the first time in history, smoke-free products have surpassed cigarette combustibles,” PMI CEO Jacek Olczak said at the Technovation event on Oct. 9 in Neuchâtel, Switzerland, according to Malaya Business Insight.
October 19, 2024
Tobacco Industry Nears Settlement of Litigation

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Canada’s three leading cigarette manufacturers will pay CAD32.5 billion ($23.6 billion) to settle a long-running lawsuit as part of a court-appointed mediator’s proposed plan, Philip Morris International announced on Oct. 18.
In 2015, a Quebec court award damages to some 100,000 smokers and ex-smokers who alleged the companies failed to warn consumers about the health risks of smoking, which they had known about since the 1950s.
The verdict was upheld in 2019, forcing the Canadian subsidiaries of PMI, BAT and Japan Tobacco International to seek bankruptcy protection.
The subsidiaries have been under a court-supervised mediation process negotiating a possible settlement since then.
The allocation of the aggregate settlement amount between the tobacco giants remains unresolved, according to Philip Morris.
“Although important issues with the plan remain to be resolved, we are hopeful that this legal process will soon conclude, allowing RBH [Rothmans, Benson & Hedges] and its stakeholders to focus on the future,” said PMI CEO Jacek Olczak.
“Today marks an important step towards a potential settlement,” said Eric Gagnon, vice president, corporate and regulatory affairs for BAT’s Imperial Tobacco Canada subsidiary in a statement. “The plan resolves all Canadian tobacco litigation and provides a full and comprehensive release to Imperial, BAT and all related entities for all tobacco claims.”
The Lung Health Foundation (LHF), too, welcomed the prospect of a settlement. “This is a meaningful first step in acknowledging decades of harm,” noted LHF President and CEO Jessica Buckley in a statement. “But financial restitution can’t make up for the loss of life. It can’t make up for the experiences of Canadians who have suffered through lung cancer and COPD.”
Buckley called for the funds to be reinvested into vaping and smoking prevention and cessation support, mental health and addiction initiatives, and improved access to screening and care for conditions like lung cancer and COPD.”
October 19, 2024
Elfbar and Lost Mary Create Advisory Board

Image: Mariakray
Elfbar and Lost Mary have created a board in the U.K. to provide strategic advice for the brands.
Board members are from across relevant disciplines in the U.K. with senior-level experience, including in the national and local government, the medical profession and law enforcement.
The newly formed advisory board also serves Heaven Gifts, the company that manages Elfbar and Lost Mary.
“The creation of this advisory board marks a milestone in the global operations of Elfbar and Lost Mary. This aligns with our long-term commitment as the responsible market leader for the vaping sector worldwide, and our exploration of the smoking cessation role vaping products play,” said Heaven Gifts Global Vice-President Victor Xiao in a statement.
“This board further signals our intent to address concerns around, for example, youth vaping, the environmental impact, and illicit trade. Starting in the U.K., we are looking to bring this mechanism to more global markets, particularly those in Europe.”
Members of the advisory board include Steve Bennett, former director of investigations at the National Crime Agency; George Eustice, former member of parliament and secretary of state for the department of environment, food and rural affairs; Susie Kemp, former CEO of Swindon Borough council and deputy chief executive of Surrey county council; Lord Porter, former council leader and chair of the Local Government Association; Sairah Salim-Sartoni, a health psychologist with extensive experience in smoking cessation and tobacco harm reduction; and Lord Walney, a former member of parliament and special advisor to Prime Minister Gordon Brown and Business Secretary Lord Hutton.
October 19, 2024
U.K. Urged to Invest in Smoke-free Future

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More than 200 leading doctors, professional bodies and charities are urging the U.K. Chancellor to use the budget on Oct. 30 as an opportunity to invest in creating a smoke-free U..K as quickly as possible, and make the tobacco industry pay.
In an open letter published by The BMJ on Oct. 16, they warn that unless smoking is addressed, there is no prospect of delivering on Labour’s manifesto commitment to halve the gap in healthy life expectancy between the richest and poorest regions.
According to the authors, the rationale for investing to end the tobacco “epidemic” could not be stronger. The annual cost of smoking to individuals, public services and the wider UK economy is £93 billion ($121.43 billion), while the direct cost of smoking to the U.K. public finances in 2023 was £21.9 billion, with a net cost of £13.5 billion.
The letter writers acknowledge that there are acute constraints on spending, but point out that smoking cessation treatment saves £2.37 for every £1 invested, while improving health improves economic productivity.
What’s more, introducing a “polluter pays” levy on tobacco manufacturers “could raise £700 million a year for vital tobacco control activity in a way that would prevent companies from simply passing the cost on to consumers, according to the authors.”
“It is a scandal that smoking continues to have such a devastating impact on the nation’s health, being linked to 15,000 heart disease deaths in the U.K. each year. Besides the grief and pain each death causes countless families, ill health caused by smoking also puts a strain on the NHS and our economy,” said Charmaine Griffiths, CEO of the British Heart Foundation, in a statement.
“The status quo is unacceptable, and we need a bold and far-reaching package of measures to consign smoking to history.”
October 19, 2024
BAT to Launch Synthetic Nicotine Pouch in the U.S.

Photo: Andrii
BAT will launch a new version of its Velo pouches using synthetic nicotine in the United States next year, reports Reuters.
Made in a laboratory rather than derived from tobacco leaves, synthetic nicotine has gained popularity among manufacturers recently as a means to avoid the Food and Drug Administration’s lengthy and cumbersome tobacco product authorization process.
While the FDA initially had authority only over naturally occurring nicotine, President Joe Biden in March 2022 signed into law a bill that extended the agency remit to synthetic nicotine. BAT’s launch would mark the first time a major tobacco company introduces a synthetic nicotine product in the U.S., according to Reuters. To date, synthetic nicotine has been used primarily by smaller manufacturers of vapes or pouches.
David Waterfield, president of BAT’s Reynolds American subsidiary, said that the product’s previous owner submitted a premarket tobacco product application before the May 2022 deadline, meaning it can stay on the market while its application is pending, Waterfield said.
The FDA, however, told Reuters that a pending application is insufficient for a synthetic nicotine product to be sold in the U.S. Products on the market without FDA authorization, the agency added, may be subject to enforcement.
BAT expects U.S. nicotine pouch industry revenues to grow from £1.7 billion ($2.21 billion) today to up to £7 billion by 2030.
October 18, 2024