WVS NEWS: Bans and taxes on disposables took centre stage in 2024

Written by Freddie Dawson | ECigIntelligence

“Disposables” was once again the word of the year in vaping – more specifically for 2024, “a ban on disposables” was the phrase of the year in the sector.

A cascade of jurisdictions passed laws to prohibit disposable e-cigarette products on grounds of protecting young people and the environment, while producers and retailers interested in continuing to sell the same sort of product quickly introduced new lines in anticipation.

For example, Belgium and France both successfully passed measures to ban disposables, while several other countries promised to bring similar legislation to fruition – including New Zealand, Ireland and the UK.

But as quickly as governments legislate, companies are moving even quicker. Already a wave of disposable-like e-cigarette devices have hit the market, with features that meet the word of the law (for example, replaceable batteries or ports to refill e-liquids) but are made from the same cheaper material as their disposable predecessors, and, in some cases, lack aspects to render them fully reusable (for example, not having access to replace the cartomiser).

Using tax to push up prices

Not everyone took the same approach to disposables. Rather than ban, some lawmakers attempted to implement taxes on vaping that would increase the price enough to make them unattractive to younger users. That was the plan for a new tax in the US state of Georgia that specifically increased the price on disposable vaping products more than reusable ones.

Others, such as in the UK, increased the price of all vaping products across the board in an effort to reduce youth uptake. The idea behind the UK’s plan was to increase duties on conventional tobacco products by an amount equivalent to or higher than those on vaping to keep e-cigarettes attractive as a cessation option while limiting their potential appeal to youth.

In other jurisdictions, it was decided to increase the price of vaping products, regardless of the impact on their usefulness as a cessation tool. That was the case in both Canada and Ireland, where planned tax increases announced in 2024 will effectively double the cost of vaping products.

But not all tales of taxation are necessarily bad news. Plans announced to tax vaping products in places like Vietnam and Argentina raised hopes that this would clear the way for official regulation – moving e-cigarettes from grey or outright illicit products to legal, regulated and taxed ones, creating new markets for vaping brands.

That does not appear to be the case in Vietnam, though, where recent announcements show the government intends to fully prohibit vaping products, but may still happen in Argentina, where those in the industry express a degree of optimism.

Wavering on flavours

Also potentially sparking optimism in the industry is the lack of flavour bans. They could have also been the talk of 2024. But while there were many demands from anti-vaping groups and several discussions, very few concrete plans were actually executed, with the few jurisdictions that have a flavour ban in place continuing to be the exception rather than the norm.

Similarly, while it is unclear whether the administration of US president Joe Biden will attempt to race through its intended, but then delayed, menthol ban for non-vaping tobacco products – as it may be trying to do in attempts to limit nicotine levels – the authorisation of a menthol vaping product by the US Food and Drug Administration (FDA) should be taken as a positive sign for the industry.

It is also unclear what the incoming administration of president-elect Donald Trump will do regarding the menthol ban. There is an opinion that Trump would not follow through with any such plans on consumer-rights grounds. But he is no fan of smoking, nor does it seem is his nominee for health secretary, Robert F Kennedy Jr. It would not be the first time Trump implements a completely unexpected policy.

Red, white and blue

Trump’s red sweep in the US elections delivered the Republican party control of the presidency, Senate and House of Representatives – alongside a Republican-leaning majority in the US Supreme Court.

This gives Trump an effective overall carte blanche to attempt to implement whatever legislation he desires. And though he did suggest he would save vaping, he has not mentioned other alternatives such as heated tobacco or pouches. Nonetheless, there is optimism that, at worst, he will take a laissez-faire, consumer-rights approach to regulation for nicotine alternatives and – in a more industry-friendly scenario – effect sweeping changes to existing regulations and bureaucracy at agencies such as the FDA, where applications to legally sell nicotine products on the US market have been widely denied or have languished unanswered for years.

Some doubts do remain on how committed the president-elect will be to keeping that promise or in fact dealing with tobacco control as an issue overall, given the myriad other pressing issues and priorities his administration will face.

Nonetheless, Trump’s win represents the biggest opportunity to enact sweeping changes since Barack Obama won the White House and the Democrats managed to also control the House and Senate 16 years ago – perhaps even bigger, given the Supreme Court is likely to be sympathetic to Republican positions.

In some irony, the Supreme Court may end up making more work for itself in that regard as, having struck down the so-called Chevron doctrine, lower courts will not necessarily have to defer to the expertise of federal agencies attempting to implement Trump policies. This could in turn eventually lead to more appeals to probable Democrat/leftist challenges appearing before the Supreme Court justices. An early indicator of how the Supreme Court will view the FDA post-Chevron doctrine may come from the Triton Distribution case, in which hearings are already underway.

A shift to the right

More globally, almost every electoral contest saw a drift towards the right, in what would generally be considered a positive for nicotine alternative markets – one major exception in the UK excluded. However, the reality may not be quite so clear-cut.

In the EU, the move right was not as sharp as some had anticipated – leaving a centrist coalition that is largely the same to continue on in power. This would suggest a fairly similar approach will be taken in what is expected to be a crunch couple of years for tobacco and nicotine regulation in the bloc.

The incoming legislators will finally have to issue a revised EU Tobacco Products Directive (TPD) as well as act continue to act on constructing a regulatory framework based on the EU’s Beating Cancer Plan.

Still, the European Conservatives and Reformists group has expressed support for harm-reduction arguments, and the far right is likely to be reluctant to enact strict measures at the EU level on philosophical grounds (either consumer choice or public health powers belong to member states). This could, at the very least, increase the debate and delay proceedings.

Overall, it was a mixed year, which has been reflected in market sentiment, with 2024 set to have the smallest increase in global vaping market size since Covid-19 impacted 2020. For the full year, ECigIntelligence estimates a global market of $31.7bn – an increase on 2023’s $28.5bn, but a smaller one than seen in any previous year this decade.