European Tax Consultation Findings

Posted 2nd October 2018 by Mawsley
The European Commission (EC) held a public consultation into the taxation of tobacco and vaping products, which ended at the beginning of September. The responses have been collated and the results published, although the EC is still compiling its report so vapers will have to wait to see what it decides to do.

The Collective of EU Vaper Associations urged vapers into action, asking them to take part in the consultation. It stated that vaping has “helped more than 7.5 million Europeans stop smoking and a further 9 million to cut down.” Just 11,410 participants across Europe replied.

At the time, New Nicotine Alliance trustee and INNCO board member John Summers said: "The EU has pushed tobacco taxes as being about health. By attempting yet again to leverage a "sin tax" on a far safer alternative they are playing with millions of lives and showing their true colours: Money and Ideology is more important than people."

"Since the implementation of TPD Article 20, this is the second attempt to bring about a tax when, as Professor David Sweanor and others have suggested, there should actually be a negative tax to encourage switching."

There was a previous consultation in
 2016, where 90% of the 7,686 replies were against the idea of a surcharge on vaping. This clearly didn’t fit in with what the Commission wanted to do so they declared that there was not enough data to make a firm decision.

This time around 88.9% of the 11'410 respondents are still opposed to the notion of placing a ‘sin tax’ on a harm reduction product that has helped so many people to quit smoking.

Most replies (95.78%) came from individuals, 242 (2.12%) from businesses, 15 public administrators, 92 from trade bodies/advisory groups/consultancies, 65 from non-government organisations and 67 classified as ‘other’. Of the business submissions, 202 were from vape shops, and 40 from those selling or making heated tobacco products.

The response from 425 people in the UK was pitiful – 3.72% – when compared to the 42.8% of those participating coming from Germany. France contributed 1,107 entries, and Spain made 1,576 submissions.

  • To the question “E-cigarettes are much less harmful than conventional tobacco products”, 88% agreed. Amazingly, 575 people disagreed – which means 574 people and Martin McKee. Despite all of the positive noise coming from the UK, 86 people still don’t know what to think.
  • To the question “E-cigarettes may represent a gateway to nicotine addiction for non-smokers”, 75% can see the wood for the trees. Either 883 people are incredibly stupid or exceptionally disingenuous when saying that vaping is a gateway to smoking.
  • To the question “E-cigarettes may support smoking cessation”, 85% of people know vaping works. Additional bedtime reading is required from the 485 people who said vaping doesn’t work as a quit tool.

1,180 people think electronic cigarettes are the same as tobacco cigarettes and should be treated in an identical manner, while 809 people think that vape devices are tobacco products and should therefore be taxed just like cigarettes.

Since the last time the EC carried out this exercise, fourteen individual countries have implemented a vape tax. Italy’s punitive tax in 2015 crippled its nascent vape industry overnight, driving many vapers back to buying tobacco cigarettes. The number of vapers fell from over six hundred thousand by almost two thirds, to 255,000.

Even Italy has worked out that this was a ridiculous situation, and its Deputy Prime Minister announced last month that the tax would be reversed.

There was a much more mixed response to the questions asking if taxes should be harmonised across the whole of Europe and whether there was enough information about the vape market to properly design a tax system for it.

The comedians had a field day when it came to the final question about what level of tax should be applied to vape products; 565 of them opted for imposing a VAT plus 30 to 49% mark-up. This could make a £50 mod cost over £70.