E-Cigarettes, Regulation and Tax Duty
Smoking cigarettes is dangerous and all smokers are aware of the risks they take by smoking. Smokers of cigarettes have a far greater likelihood of dying from cancer at a younger age than non-smokers. Many governments around the world are influenced by the tobacco industry.
Smoking and the Law
We are all led to believe that our Government have our best interests at heart and yet they still raise billions every year by taxing a product that they know kills us. The government also raise billions annually from alcohol which is similarly harmful.
There is an increasing movement making lots of noise, voicing their concerns over the potential dangers of e-cigarettes and vaporizers. Each year, 200 people die in work related accidents, leading the government to introduce health and safety legislation to protect them, however, at the same time they allow 100,000 people to die each year from smoking related illnesses because the exchequer needs the tobacco duty.
Where would the government find the £12.1 billion it would lose if smokers all quit tobacco? It seems that the government don’t mind dangerous products as long as they make a profit from them.
The Regulation of E-Cigarettes
At some point as the revenue from tobacco duty falls, the government will look to regulate and tax e-liquid and vaporizers in order to replace the lost taxes. It is likely that regulation will mean the demise of smaller manufacturers making and selling e-cigarettes.
Will any regulation of e-cigarettes be in the public interest or the interests of the exchequer? The main reason for regulation of e-cigarettes will be to allow the government to effectively tax them and their use.
Opponents to Electronic Cigarettes
Two powerful industries, the tobacco and the smoking cessation sectors are going to be worst hit by increased e-cigarette use. Nicotine patches and gum don’t give the user the same satisfying hit of nicotine when used.
The tobacco companies are looking to protect their market share and don’t want e-cigarettes to become even more popular however, it’s not easy for them to argue against electronic devices on a health platform. It is suspected that some tobacco companies are quietly supporting the anti e-cigarette stance being taken by the smoking cessation industry.
Potential Regulation of E-Cigarettes
How hard will the government really try to push healthier alternatives to smoking when it is s reliant on the income that tobacco duty provides? If you can make e-liquid at home with household ingredients then there will always be an “underground” supply avoiding any duty levied on official products.
The level of duty on e-liquid will have an affect on the amount of users that start to make their own. As long as cigarettes tasted OK and had nicotine in them we weren’t that concerned where they came from as I recall. In the next few months we will discover what legislation will be past to regulate e-cigarettes. In order for e-cigarettes to become a mainstream product, the government will need to be able to apply duty to e-liquid.
Despite being a much safer alternative to smoking tobacco, it electronic devices can’t be properly taxed then governments around the world are more likely to ban then instead.
Regulation will allow governments to protect their current income from cigarette duty. Taxation of e-liquid would go some way towards mitigating the gradual erosion of tobacco duty revenue.
In conclusion, it is unlikely that electronic cigarettes will continue to be sold unregulated for much longer.