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EU Plans To Give Vapers ‘A Further Kick In The Teeth’ With Massive Tax Increase

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Guy Bentley Research Associate, Reason Foundation
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European vapers are facing a massive tax increase as e-cigarettes are soon to be treated the same as tobacco.

EUobserver reports European ambassadors asked the executive body of the European Union, the European Commission, to draft an “appropriate legislative proposal” in 2017 to put e-cigarettes under the same tax regime as tobacco.

EU finance ministers, who will meet March. 8, appear to be gung-ho for putting e-cigarettes on par with tobacco. “In order to facilitate an appropriate, equal taxation treatment of new products within the internal market and remove potential inconsistencies and legal uncertainty,” the ministers said in a document published Feb. 26.

But the EU’s agenda for raising taxes on e-cigarettes is not limited to avoiding legal grey areas. There “needs to be practical and foresighted, and strike the right balance between the revenue, expenses of tax administration and public health objectives,” according to the draft document.

The document argues there should be some “other specifically designed tax” for nicotine delivery systems that use steam instead of smoke. It adds a new tax regime should be “intensified” if “the market share of such products show a tendency to increase.”

The EU requires all member states impose an excise tax of 57 percent on tobacco products. Most states just impose a 20 percent Value Added Tax on e-cigarettes, according to EUobserver.

“Despite the fact that the appalling ‘Tobacco’ Products Directive will come into force between now and the (UK) referendum, the EU is already planning to give vapers a further kick in the teeth,” writes the UK’s Christopher Snowdon, Head of Lifestyle Economics at the Institute of Economic Affairs. (RELATED: What is Brexit? Everything You Need To Know About Britain’s EU Referendum)

“If this is what the EU is doing when the British have been given an escape hatch, imagine what it will be like if we vote to stay in,” he writes. (RELATED: Vapers For Britain: Why E-Cigarette Users Support Brexit)

The United Kingdom has one of the highest tobacco taxes in Europe — each pack of cigarettes net the government $8.60. Deeply indebted European governments could use further taxes on e-cigarettes to prop up dire public finances.

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