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  • Philippines Approves Tobacco Tracking Bill

    Philippines Approves Tobacco Tracking Bill

    To deter illicit nicotine products, the House of Representatives in the Philippines approved a measure to introduce a track-and-trace system for tobacco products. Under HB 11286, cigarettes, vapes, and tobacco products would need to be affixed with a stamp that has “physical or digital features,” while requiring companies to register equipment needed in making cigarettes and electronic vapes with the government.

    “The illicit tobacco trade in our country is alarming,” Rep. Ray Florence T. Reyes, who sponsored the measure, said. “One in five sticks of cigarettes did not pass the quality control and is more likely to cause death. “These unregulated products expose consumers to greater health risks.”

    Meanwhile, the House Ways and Means panel is eyeing an annually alternating tax rate hike scheme on cigarette products, while also tweaking the tax rate over all tobacco products. HB 11360 seeks to implement an odd-and-even numbered tax rate increase for cigarettes to curb the surge of illicit tobacco products in the Philippines.

    “The rate of tax imposed shall be increased by 2% every even-numbered year effective on Jan. 1, 2026, and 4% every odd-numbered year, effective on Jan. 1, 2027,” the bill stated, changing the tax rate structure across all tobacco products.

     “The increase shall be implemented until Dec. 31, 2035, provided that after the 10-year period, a review of the tax imposed and its impact on revenue collections, health costs, and prevalence of smoking shall be conducted.”

    Discussions over the levied tax rates for cigarettes have taken a front seat at the House tax panel, which is eyeing to reduce excise tax losses over the tobacco industry due to smuggling. Excise tax rates for heated tobacco, cigarettes, and vape products are levied a yearly 5% tax rate increase from 2024, according to the Bureau of Internal Revenue’s (BIR) website.

    “BIR revenue data show that further successive increases in tax rates have failed to result in higher collections,” Euvimil Nina R. Asuncion, revenue operations group director for the Finance department, said. The BIR collected only P134 billion (USD $2.3 billion) of its budgeted P185 billion (USD $3.1 billion) tobacco excise tax in 2024.

    However, Anthony C. Leachon, former Department of Health advisor and convener of health advocacy group Sin Tax Coalition, said the bill would actually lower revenues collected.

    “We project that this will lead to P29 billion of forgone revenue for public health and tobacco farmers from 2026 to 2030 and will make cigarettes and electronic smoking devices more accessible to the youth and the poor,” he said.

  • Japan Tobacco Investing Heavy on RRPs

    Japan Tobacco Investing Heavy on RRPs

    Japan Tobacco Group, the parent company of Japan Tobacco International (JTI), announced that it will be investing 450 billion yen (USD $3 billion) on reduced-risk products (RRPs) by the end of 2026. The parent company is based in Tokyo and invests in various fields including pharmaceuticals and foods, while JTI is based in Switzerland.

    “One of our ambitions is to recoup by 2028 our investments in RRPs and reach profitability,” said Kazuhito Sumimoto, JT investor and media relations vice president, who noted the investment covers capital expenditures, sales promotions, and research and development.

    This investment stands on the shoulders of JTI’s 2021 launch of Ploom X—the latest generation of its heated tobacco product line designed to meet the changing needs of smokers.

    “The geo-expansion of Ploom, our investment priority, has now reached 23 markets, and in Japan, the largest Ploom market, we continued to gain share in this segment, reaching 11.8 percent quarter-to-date,” said Masamichi Terabatake, JT Group’s president and chief executive officer, who added that Ploom’s overall sales grew 40% in the third quarter of 2024

    JT investor and media relations director Ichiro Kawai said the company expects combustibles to decline 2% by 2035, but heated tobacco products to rise by 8%.

    It took two years for Ploom X to expand to 12 markets outside of Japan, including being introduced in the Philippines in November 2024. Its success in the Philippines gives JTI momentum and confidence that it can reach its goal of being in 40 global markets by 2026.

  • Massachusetts Judge Issues Record-Setting Judgement

    Massachusetts Judge Issues Record-Setting Judgement

    A judge in Hampden County, Massachusetts, issued one of the biggest individual civil judgments in history, awarding $105 million to the family of a deceased smoker. Judge Edward McDonough Jr.’s decision came a month after a jury awarded the plaintiffs $10.6 million after a month-long trial, with the judge saying the defendant, R.J. Reynolds, “willfully and wantonly” engaged in a conspiracy to hide the health hazards of cigarette smoking.

    Kevin Penza, along with his daughter, Kimberly Breen Penza, sued on behalf of his late wife, Jacqueline, who died from lung cancer at 59. The plaintiffs argued Jacqueline spent much of her life trying to quit the smoking habit, but was trapped in a nicotine addiction she could not defeat. The defense countered she was a committed smoker who made her own choices and refused to quit despite pleas from her family and doctors.

    McDonough began with the jury’s $10.6 million decision and added $2 million in attorney’s fees. The additional sum included interest and fees, but he did not clarify how the final sum was reached. R.J. Reynolds is expected to appeal this ruling.

  • Busy Day for BAT Stocks

    Busy Day for BAT Stocks

    British American Tobacco (BAT) executed a share buyback program January 27, purchasing 129,541 ordinary shares at an average price of £29.951908 per share. According to TipRanks, this move, authorized by shareholders, “is part of its broader strategy to enhance shareholder value by reducing the number of shares in circulation, which could potentially impact the company’s stock value and stakeholder interests.”

    Later in the day, the stock rallied to £31.50 on what proved to be an all-around great trading session for the stock market, with the FTSE 100 Index. According to MarketWatch, that price was a 52-week high for BAT, surpassing the £30.47 from January 24.

  • Hong Kong Proposes Public Vape Ban

    Hong Kong Proposes Public Vape Ban

    Hong Kong authorities have proposed a citywide ban on the use and possession of e-cigarette cartridges and flavored tobacco products in public places, according to the South China Morning Post. The public ban would be the first of two phases, with the second phase expanding to non-public spaces.

    The proposal comes after a heated public debate where the government touted 10 measures aimed at reducing the city’s 7.8% smoking rate.

    Several business leaders cautioned that bans would discourage visitors and businesspeople from coming to the city.

  • Washington: More Tax Hikes Proposed

    Washington: More Tax Hikes Proposed

    On January 20, the state of Washington saw two bills proposed, House Bill 1416 and House Bill 1417, that would further hike the state’s higher-than-average tobacco taxes. We reported that the two bills would add an additional 33 cents of taxes per pack of cigarettes (currently based at $4.035 before any local sales taxes), and that “existing taxes on most vape juices, cigars, and other products would be raised.”

    Writing for Halfwheel, Patrick Lagreid dug into the actual increases on several nicotinereu products. Washington has a tax rate of 95% of the taxable sales price, maintaining a cap on the maximum tax that can be charged. Lagreid said the cap on premium cigars would be raised from 65 cents to 72 cents.

    “The bill also raises the tax on vapor products from 27 cents to 30 cents per milliliter of solution, while what are described as ‘accessible containers of solution’ will go from nine cents to 10 cents per milliliter, regardless of whether or not they contain nicotine,” he wrote. “Moist snuff would also see an increase, going from $2.526 to $2.776 per package of 1.2 ounces or less, though there is a provision that the tax must be at least that amount or 83.5% of the cigarette tax.”

    The bills were proposed by Rep. Kristine Reeves and referred to the House Committee on Finance for initial rounds of debate. If passed as written, the increases would go into effect October 1.

  • New Administration Withdraws FDA’s Menthol Ban Bid

    New Administration Withdraws FDA’s Menthol Ban Bid

    The Trump administration issued a setback to health regulators and anti-tobacco activists as it withdrew a plan to ban menthol cigarettes in the United States.

    In April 2022, the U.S. Food and Drug Administration (FDA) proposed to ban the sale of flavored cigars and menthol cigarettes after several health advocacy groups said they were highly addictive and attractive to young people. A January 21, 2025, filing by the Office of Information and Regulatory Affairs shows that the proposal has now been “withdrawn.”

    The FDA sent its final version of the regulation to the White House in October 2023, however, the administration allowed dozens of meetings with groups opposing the rule, including civil rights advocates, business owners, and law enforcement officials, according to Reuters, with the government missing deadlines in December 2023 and March 2024 to issue a final rule on the ban.

    An estimated 18.5 million smokers consume menthol cigarettes, comprising one-third of the U.S. market share, meaning a ban would have cost billions of dollars in annual revenue for the industry.

    With news of the proposal withdrawal, Tobacco companies saw their stocks rise today, with British American Tobacco gaining 1.3% and both Altria Group and Philip Morris International gaining 1%. The market’s response suggests investor relief at the removal of a significant regulatory risk for these companies.

  • Wall Street Likes Big Tobacco

    Wall Street Likes Big Tobacco

    According to Seeking Alpha, a leading financial research firm, U.S.-listed tobacco companies had a successful year of returns in 2024. “The dividend aristocrats Philip Morris, British American Tobacco, and Altria Group rose between 24% and 27.9% last year, compared to S&P 500’s 23.3% gain during that period,” Seeking Alpha wrote.

    Seeking Alpha’s analysts and Wall Street opinions think 2025 will be equally positive for Big Tobacco.

    “On British American Tobacco, the bullishness of SA analysts crossed with one Sell, two Holds, and a Buy recommendation of sell-side analysts. Similarly, Altria Group got a resounding Buy from Seeking Alpha analysts compared to a wide spectrum of opinions on Wall Street.

  • U.K. Vape Market on the Rise

    U.K. Vape Market on the Rise

    The e-cigarette market in the U.K. is estimated to grow by $1.47 billion from 2025-2029, according to Technavio, a market research company that specializes in growth opportunities, growing at a CAGR of 13.6%.

    “The U.K. e-cigarette market is undergoing a substantial evolution, marked by inventive product improvements,” Technavio writes. “Notable is the shift from disposable e-cigarettes toward reusable pod systems. These systems offer environmental benefits, as they allow for recharging and refilling, thereby reducing waste. Moreover, advancements in e-liquid formulations, like nicotine salts, provide enhanced nicotine delivery with a smoother sensation. Innovations in coil technology further boost flavor intensity and vapor production, thereby improving user experience.”

  • Washington State Wants High Taxes Higher

    Washington State Wants High Taxes Higher

    The state of Washington saw two bills proposed this week that would further hike the state’s higher-than-average tobacco taxes. Rep. Kristine Reeves proposed House Bill 1416 and House Bill 1417 with a number of other Democrat cosponsors. Both measures impose additional taxes on those already in place for tobacco products. 

    HB 1416 imposes a new $0.015 per cigarette tax, about 30 cents for a standard pack. It also raises existing taxes on most vape juices, cigars, and other products. HB 1417 imposes a new $0.0015 per cigarette “embodied carbon tax,” about 3 cents a pack.

    These proposals are in addition to the taxes already in place, including $3.025 tax per pack from the state, $1.01 per pack federal, and other local sales taxes. Reeves also wants to ban flavored tobacco products.

    Because Washington has some of the nation’s highest tax rates on nicotine products, it, according to the Tax Foundation, also has some of the highest smuggling and counterfeit rates, costing the state an estimated $178.8 million in revenue. 

    According to HB 1416, revenue from vape products would be split evenly between cancer research and public health services, however, revenue from other taxed products would go directly to the general fund. The revenue from HB 1417 would go to the general fund and would be earmarked to “counteract carbon emissions,” but the bill does not explain how that would work. Coincidentally, both proposals come as the state anticipates a revenue shortfall between $10 billion and $16 billion over the next four years.