Italian e-cigarette firms say new tax benefits tobacco

admin   •   March 2, 2015   •   2166

A man uses an E-cigarette, an electronic substitute in the form of a rod, slightly longer than a normal cigarette, in this March 5, 2013 file illustration picture taken in Paris.
CREDIT: REUTERS/CHRISTIAN HARTMANN/FILES

(Reuters) – Electronic cigarette firms in Italy say a new levy that doubles the price of e-liquid refills unfairly helps tobacco giants like Philip Morris International and will hurt their industry.

The tax, which was adopted in January, is set at half the rate of that on traditional cigarettes. The controversy centers on the fact that the lower rate is applied to both electronic cigarettes and to tobacco products such as Marlboro HeatSticks, which Philip Morris is launching in Italy alongside a 500 million euro ($568 million) factory investment.

E-cigarette companies say applying the discount to tobacco products is unfair, and designed to help Big Tobacco. The firms and industry experts also say the method of calculating the tax is too complicated and gives an unfair discount to Philip Morris’ products.

“It’s unjust,” said Massimiliano Mancini, president of ANAFE-Confindustria, a national trade association of e-cig and e-liquids producers. “It’s clear that this legislation has been drafted for other interests than just taxing the e-cigs.” He declined to elaborate.

Philip Morris would not comment on whether the new law gave it an advantage. “We have shared our views with the government via public hearings just like our competitors and others,” a spokesman told Reuters by email.

It pledged last year to make HeatSticks and other “reduced risk” products in a new factory in Bologna. Shortly before the plant’s inauguration, the firm’s CEO in Italy, Eugenio Sidoli, told the Senate Finance Committee that he welcomed the new tax rules, saying they would create “a certain and stable” regulatory outlook for the kind of investment his company was making.

Italy is one of the first countries to tax e-cigarettes; the European Union is considering the idea. The devices do not use tobacco, which contains hundreds of toxins, but instead heat liquids laced with nicotine. Many scientists agree the products are probably safer than conventional cigarettes.

Other new devices such as Marlboro HeatSticks do use tobacco and have not yet been tested to the same degree. Unless studies prove they are as safe as e-cigarettes, e-cig firms say, they should not be taxed at the lower rate.

In all, Italy collects around 12 billion euros a year in tobacco taxes. Philip Morris’ products account for 7.5 billion euros of that, according to the testimony Sidoli gave the Senate committee last October.

But Italy’s tobacco tax take has declined by more than 500 million euros since 2013. The government has said that’s partly due to the rise in e-cigarette sales. It began to think about taxing the devices in 2013 and initially introduced a tax that more than tripled e-liquid prices, and also applied to batteries and chargers sold with e-cigarettes.

That tax was blocked by Italian courts as too confusing, forcing Rome to rethink its plans. But e-cigarette distributors and some big tobacco companies object to the latest scheme, too.

The drawn-out controversy has hurt the industry in Italy, e-cig backers say. While e-cigarette use has been growing globally, the number of regular “vapers” in Italy has slumped to 255,000 from almost half a million in 2013, health ministry figures show. Thousands of e-cigarette shops have closed.

Italy’s Economy Ministry declined to comment.

“ABSENCE OF COMBUSTION”

Italy’s new law assumes that e-cigarettes are safer and should be taxed at a lower rate than traditional cigarettes. The e-cigarette lobby welcomes this but objects to extending that discount to other new products, such as the tobacco-based systems sold in Italy by Philip Morris and Japan Tobacco International (JTI), which heat tobacco in pen-like devices. The Philip Morris system uses tobacco sticks that look like mini cigarettes while JTI’s system, called Ploom, uses aluminum pods filled with tobacco.

Philip Morris says HeatSticks, which it is also testing in Japan, are potentially less harmful than traditional cigarettes “because they are not intended to be lit on fire and smoked, but rather heated and vaped.”

But neither it nor JTI include health claims in their marketing for heat-not-burn products. Philip Morris expects to have more scientific evidence during the first half of this year, its CEO told analysts earlier this month.

Even so, Italian lawmakers said in the tax decree that a tax discount on such products was justified by the “absence of combustion” which gives them “minor toxicity” compared with traditional cigarettes.

Valerio Forconi, Corporate Affairs and Legal Director in the Italian branch of tobacco giant Imperial Tobacco, says the principle of the tax is wrong.

Imperial, whose subsidiary Fontem Ventures plans to launch a new e-cig model in Rome in March, does not object to the tax charge, he said, but believes it is too high compared to tobacco products. Philip Morris’ HeatSticks can be lit and smoked, according to Forconi. This makes Italy perhaps “the only country in the world” that effectively gives Philip Morris a tax discount on smoking.

Philip Morris said HeatSticks should not be lit and smoked. “If burned,” the spokesman said, “the experience would not be pleasurable.”

(Additional reporting by Giuseppe Fonte and Steve Scherer in Rome; Edited by Simon Robinson)

Duterte signs into law higher taxes on alcohol, e-cigarette

Aileen Cerrudo   •   January 23, 2020

President Rodrigo Duterte

President Rodrigo Duterte has signed a law imposing higher taxes on alcohol, e-cigarettes, and other vapor products.

The Republic Act no. 11467 was signed to raise additional funds for the government’s Universal Healthcare Law.

Under the newly signed law, taxes on distilled spirits shall increase to P42 per proof liter this year and will increase by 6% every year starting 2025. There will also be an ad valorem tax imposed on the products which is 22% of the alcohol prices.

Meanwhile, taxes of wine and beer products will increase by P50 and P35 per liter respectively. These products will also be subjected to a 6% tax increase every year starting in 2025.

For vapor products, a pack of heated tobacco will have an excise tax of P25 this year. Salt nicotine products will have excise taxes set at P37 per milliliter while cigarette taxes are set at P45 per pack this year.

Taxes of all vapor products will increase by 5% every year in the succeeding years.

The law, meanwhile, exempts medicine for diabetes, hypertension, and high cholesterol in value-added tax.

By 2023, the law will also exempt value-added tax on prescription drugs for cancer, mental illness, tuberculosis, and kidney disease.

However, Presidential Spokesperson Salvador Panelo said the President has vetoed section 5 of the Republic Act.

“The sin tax law that has been approved, there’s one provision that was vetoed, section 5, regarding the authority of the court to first grant seizure of properties as well as searching,” he said.—AAC (with reports from Rosalie Coz)

Eiffel Tower closed as France braces for major strikes

UNTV News   •   January 9, 2020

Paris – The Eiffel Tower will remain closed Thursday as France braces for a fourth consecutive day of major cross-sector strikes against pension reforms.

Teachers, health workers, lawyers and railway personnel are participating in a strike called by unions to demand the total withdrawal of a pensions reform bill which was announced in December.

Transport will continue to be affected by strike action with both the national railway network (SNCF) and the transport in the Paris region offering reduced services.

This will be the 36th day of strike action affecting the transport sector, the longest in history.

The SNCF expects traffic to be very disrupted with more than half of train services cut, as well as the Paris subway.

The French Civil Aviation Authority also warned of disruptions and delays and urged companies to cancel a third of their flights to or from Toulouse (southern France).

In Paris, the Eiffel Tower will be closed on Thursday, according to the company that manages the monument, as some of its workers have joined the strike.

From the first day of action on 5 December, when between 800,000 people (according to the Ministry of Interior) and 1.8 million workers (according to the unions) flooded the streets of France to demand the government to reverse a pension reform bill.

According to a survey published on Sunday by Le Journal du Dimanche, more than half of the population (55%) want the government to withdraw the reform.

However, rejection of the strikes has also grown, the effects of which can be seen in the rail and metropolitan transport sector of Paris.

Thursday’s industrial action is the first mobilization of the year and will serve as a test to verify the support behind the protests after strikes on 10 and 17 December failed to raise the same level of support as the first one.

Trade unions have called for “the withdrawal of the reform project and the opening of constructive negotiations to improve the current regime”.

But the clash over pension reforms has seen one of President Emmanuel Macron’s key policies to transform the labour market come under fire.

Macron has led on several labour reforms in an attempt to create a more flexible market reminiscent of Nordic models, but his move to streamline the complex pensions system under one points-based model has triggered the largest unrest of his presidency.

The largest union in the country, the reformist French Democratic Confederation of Labor (CFDT), has opposed setting the retirement age of 64 but has backed the move to create a universal system to replace the current one which has 42 different pension plans in place.

The Government is still negotiating with unions until the reform goes to the Council of Ministers on 24 January.

So far, some concessions have been made such as an earlier retirement for professions deemed dangerous, a revaluation of teachers’ salaries, a delay in the implementation of the plan in the railway sector and for the dancers of the Paris Opera, which since 5 December has been forced to cancel more than 60 representations. EFE-EPA

mdv/ch

PNP to enforce arrest-and-release system for individuals vaping in public

Aileen Cerrudo   •   November 21, 2019

The Philippine National Police (PNP) will implement an arrest-and-release system for individuals caught vaping in public.

PNP officer-in-charge Lt. Gen. Archie Gamboa clarified that they will not detain apprehended vapers while the new executive order is still pending in Malacañang.

“We can arrest but we cannot punish, arrest in not punishment,” he said.

Arrested individuals, according to Gamboa, will be recorded in the police blotter and will be released.

“If you include vape in that EO, it’s actually an expansion of the definition of smoking, kaya sabi pwede i-implement agad (that’s why it can be implemented immediately). However, in the absence of publication, which is required for any state to impose punitive action, hence, another EO is required for it to be published and then tsaka magkaroon ng (there will be) punishment,” he added.

The PNP OIC also assured there will be no abuse in the implementation of the arrest-and-release system.

Gamboa released a memorandum on Wednesday (November 20) declaring all PNP camp and office a ‘no vape zone’.

He also directed police officers to arrest individuals caught vaping in public.

This was after the directive of President Rodrigo Duterte on Tuesday (November 19) to ban the importation and use of vaping.—AAC (with reports from Lea Ylagan)

TAGS   

REACH US

The Philippine Broadcast Hub

UNTV, 915 Barangay Philam,

EDSA, Quezon City M.M. 1104

(+632) 8396-8688 (Tel)

(+632) 8920.8336 (Fax)

info@untvweb.com (General inquiries)

support@untvweb.com

UNTV News and Rescue Emergency Hotlines:

LANDLINE (+632) 8396-8688

ADVERTISE WITH US

(+632) 8 442.6244 Loc. 143, 144, 162, 164

advertising@untvweb.com

ABOUT UNTV

UNTV is a major TV broadcast network with 24-hour programming. An Ultra High Frequency station with strong brand content that appeal to everyone, UNTV is one of the most trusted and successful Philippine networks that guarantees wholesome and quality viewing experience.