The war against the taxation of e-cigarettes: The Finance Committee will convene today (Tuesday) at noon to discuss the tax order on vaporizers and e-cigarettes, with behind-the-scenes pressure to reduce the amount of tax or at least make it a gradual procedure.
Representatives of the evaporation companies have in recent weeks sent position papers to Knesset members and also asked to meet with them to present the gap between the proposed tax and that of Western countries. According to the draft order that will be discussed in the committee on liquid for filling e-cigarettes, a purchase tax of 270% of the common wholesale price will be imposed plus NIS 11.39 per ml, which in any case will not be less than NIS 21.81 per ml. Disposable cigarettes will be subject to a purchase tax of 360% of the common wholesale price – a minimum of NIS 32.72 per unit.
The order further seeks to stipulate that it will be possible to put liquid in an e-cigarette in an amount not exceeding 10 ml, and in the case of a disposable e-cigarette – the amount of cigarettes shall not exceed 5.
Evaporation companies: Aggressive taxation
The evaporation companies claim that this is an aggressive taxation that does not address the nicotine concentration in the products and will cause the market to collapse, but the Ministry of Health claims that this is a direct comparison to the taxation imposed on regular cigarettes.
The discussion that will take place today was attended by 13 stakeholders in the field of vaporizers, including three lobbyists: Avraham Ovadia, a representative of Take Air Israel – the chain of stores selling e-cigarettes; And Adv. Doron Dan and Adv. Yigal Koloff, who represent “Bifarsh”.
The director general of the Association for Progressive Democracy, Shabi Gatnio, sent a letter to the chairman of the Finance Committee, MK Alex Kushnir, yesterday (Monday), regarding Zvi Herzig’s participation in the discussion, in which he asked the chairman to clarify on whose behalf he was present. “We have been informed that Mr. Zvi Herzig, who presents himself as an anti-smoking activist, has initiated the sending of a letter regarding the position of various parties against the taxation of e-cigarettes. I would like to inform you about past events concerning Mr. Herzig, At most it can be defined as ‘active for e-cigarettes’ “.
Gatnio also wrote that “In case Mr. Herzig participates in the planned hearing, please make sure he is there on behalf of a particular body, and if the answer is yes, then what is the name of the body and what is Herzig’s role in that body. Does this body or Mr. Herzig receive direct or indirect funding? “From some factors, and if so, who are those factors. It is obligatory to demand from Mr. Herzig transparent conduct regarding his activities, so that the committee chairman and its members can associate his remarks with the group of opinion leaders relevant to the discussion, and not mistakenly think he belongs to another group.”
Herzig himself told Globes that “I have been active against smoking most of my life, with no conflict of interest with tobacco companies or e-cigarettes.”
The position papers distributed to Knesset members by the evaporation companies state that the taxation that will be approved has no equal in the world. “A growing list of reputable science and health organizations and governments around the world have issued statements confirming that nicotine vaporization (‘e-cigarettes’) is safer than cigarette smoking. More than 70 organizations agree – ‘vaporization is safer than smoking’, and state clearly and unequivocally Because the e-cigarette is healthy in relation to tobacco cigarettes with broad international agreement on it.
“The Minister of Finance, Mr. Avigdor Lieberman, apparently was not updated on these most basic data on the subject and even said in the media: ‘The Ministry of Health has clearly stated – it is no less harmful than regular cigarettes.’ The tax electronics imposed on burning tobacco cigarettes, and all those that added taxation, it applies, by an absolute majority, only to filling liquids with nicotine.
“In light of all the above, most countries in the world did not impose any tax on evaporation products. Some countries imposed a partial tax. However, no country in the Western world imposed the same tax rate on burning tobacco cigarettes and e-cigarettes, as the State of Israel did.”
According to Shai Partig, an activist in the evaporation community in Israel and a representative of the evaporation companies forum who will participate in the discussion, “Although they manage to obscure this, it must be remembered – evaporation products are the only existential threat to tobacco giants in the world.” Absolutely (95% according to the English Ministry of Health) and intended for adult smokers who can not quit smoking. “Jol’s cartridge, a product that was outlawed in Israel, because of its high nicotine concentration (three times what is allowed by law), and has not existed for almost 3 years.”
Ministry of Health: Do not differentiate between different smoking products
In contrast, the policy of the Ministry of Health presented to the committee members was that the vaporizers are just as dangerous as the tobacco materials. “The Ministry of Health presented in the report is that there is no difference between the different types of smoking products. According to the ministry, taxation on e-cigarettes should be determined similar to that imposed on tobacco products. “Filling fluid per 10 ml in accordance with the European directive, and it was also recommended to consider taxation not only on the filling fluid but on all components, including the device, batteries and cartridges, in order to create a price barrier.”
The Knesset’s legal counsel visited the Ministry of Finance, which presented the order for public comment for only six days, as well as the fact that the order is submitted for approval retroactively after it has already been applied. The Knesset’s legal counsel also criticized the fact that a graded outline was not presented as was the case with tobacco.
“During 2012, when it was decided to raise the tax on hookah tobacco and pipe tobacco and compare it to the tax on rolling tobacco, the Finance Committee did not approve an immediate and sharp increase in tax rates, but a graded outline in which the tax increase was spread over three years. It is right to set a graded outline for raising taxes. “
Adv. Shlomit Erich also wrote that it should be examined whether there was an effect on the volume of tobacco consumption following the taxation: It is proposed to find out in relation to the different types of tobacco products whose tax rates have been compared to the tax rates of e-cigarettes – whether this has had an effect on the volume of consumption over the years. “
The discussion in the committee is expected to be heated, since in recent years since Gatnio addressed the Knesset, representatives of the tobacco companies have not been allowed to participate in the committee discussions. The coalition also has a dispute over the amount of the tax, and some Knesset members intend to oppose the wording of the proposed order in the debate, but the committee chairman, it seems, intends to keep the wording and approve the order as written.
Today’s debate will be the first in a series of debates, and a vote is not expected.
Members of the Knesset who spoke with the lobbyists of the evaporation companies told Globes that the companies told them that comparing the tax on e-cigarettes was intended to make smokers return to regular cigarettes and do better with tobacco companies, and even argued for cooperation between the finance minister and these companies.