Healthcare is an important part of any government’s responsibility to its people, which is why the $12 million being raised as part of a proposed healthcare bill in the US is something that will be welcomed in many quarters. However, there are two things that pique our interest here at The London Vape Company – the first being that for a country the size of the US, that has a population of over 300m, this sum seems practically insignificant, unable to even scratch the surface of any healthcare issue, and the second is the bill’s targeting of e-cigarettes.

The United States House of Representatives has, irresponsibly in our view, decided to expand their excise tax to e-cigarettes and other devices designed for vaping liquids that contain nicotine. This is a potentially massive blow to this burgeoning sector that aims to do so much good for smokers looking for help in quitting their tobacco addictions.

The scary thing is that this will mean the cigarette sales tax or ‘floor stock tax’ that is due to increase by 33% over the next two years will be applied to e-cigarettes as well. Currently, e-cigarette excise tax is half that of regular cigarettes, at 46%, but this is now threatened with a significant increase.

If the bill was to pass, then almost a quarter of a million dollars will be raised through this additional e-cigarette tax. A drop in the ocean for the healthcare bill, but potentially a killer blow for many small vaping businesses currently happily helping smokers to reduce their tobacco habit with a view to quitting.

The one ray of light is that the vote to include e-cigarettes in this tax hike was only passed by a very narrow margin – 70 for versus 67 against – which suggests that maybe US feelings towards e-cigarettes are thawing.

According to the Centers for Disease Control and Prevention (CDC), six million people die each year from smoking-related conditions. So it seems crazy to me that a sector which has grown up on the promise of helping smokers to quit a habit that is killing them, often spearheaded by ex-smokers who themselves have found that vaping helped them when all other means had failed, would be under threat from a bill that is aimed at healthcare!

The irony is, that should smaller vaping businesses be hit by the new taxes, it would be likely that the ‘old guard’ tobacco companies would be the biggest winners from the situation.

You see, recognising that their stock-in-trade was finally being considered a ‘dirty’ habit, many of the leading tobacco companies have invested in their own e-cigarette brands. These have grown to be some of the biggest in the world because of the funds that back them – it would be these same funds that would likely protect these businesses from closure due to excessive taxing. And as those small dedicated firms created by passionate ex-smokers and other caring entrepreneurs fall by the wayside, the old monopolies are likely to remain.

At The London Vape Company we’re all for tough regulation to ensure that only the best e-cigarettes, mods and e-liquids are manufactured, imported and sold. But don’t tax electronic cigarette firms out of business or the result could be millions of optimistic vapers being driven back to old toxic habits.

SOURCE

  • http://vtdigger.org/2015/05/01/house-passes-12-million-health-care-package-with-e-cigarette-tax-restrictions/