{"id":5529,"date":"2021-10-06T13:18:36","date_gmt":"2021-10-06T11:18:36","guid":{"rendered":"https:\/\/snusforumet.se\/?p=5529"},"modified":"2021-10-06T15:06:07","modified_gmt":"2021-10-06T13:06:07","slug":"proposed-us-tobacco-tax-could-have-game-changing-impact-on-nicotine-pouches","status":"publish","type":"post","link":"https:\/\/snusforumet.se\/en\/proposed-us-tobacco-tax-could-have-game-changing-impact-on-nicotine-pouches\/","title":{"rendered":"Proposed US tobacco tax could have \u2018game-changing impact\u2019 on nicotine pouches"},"content":{"rendered":"\n

The price of nicotine pouches in the US could rise by 178%, making them more expensive than cigarettes, if a new US tobacco tax proposal becomes law.<\/strong><\/p>\n\n\n\n

The budget proposal, put forward last month by the Democrat-led House Committee on Ways & Means, includes a large increase in the tobacco Federal Exercise Tax (“FET”). <\/p>\n\n\n\n

The levy, which has not been raised since 2009, would for the first time also cover vaping liquids and nicotine pouches<\/a>.<\/p>\n\n\n\n

\u2018Taxable nicotine\u2019 provision<\/h2>\n\n\n\n

The proposal includes a “taxable nicotine” provision<\/a> covering \u201cany nicotine (other than nicotine used in listed tobacco products) that has been extracted, concentrated, or synthesized\u201d.<\/p>\n\n\n\n

Should the proposal become law, a can of 20 nicotine pouches with 8mg of nicotine would be subject to a tax hike of $8.90, according to an analysis by the US-based Tax Foundation<\/a>. <\/p>\n\n\n\n

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Currently, nicotine pouches are not subject to federal taxes in the US and have an average retail price in the US of $4-6 excluding various state-level tobacco taxes.<\/p>\n\n\n\n

The proposal would also raise taxes on snus by an eye-popping 2,892%, according to the Tax Foundation.<\/p>\n\n\n\n

Nicotine pouches pricier than cigarettes?<\/h2>\n\n\n\n

An analysis by Librarian Capital<\/a> investment firm found that the Democrats\u2019 proposed tax hikes would have a greater impact on the retail prices of less-harmful nicotine products. <\/p>\n\n\n\n

While cigarette prices would only increase by 14 percent, the retail price of snus would rise by 32%, with vaping pod prices likely rising by 49%.<\/p>\n\n\n\n

The proposal would have the biggest impact on the price of nicotine pouches, which would rise by 178% according to Librarian Capital\u2019s analysis. This would make pouches more expensive than deadly cigarettes despite their much lower health risks.<\/p>\n\n\n\n

Speaking with Filter magazine<\/a>, health economist Michael Pesko from Georgia State University said it makes \u201clittle sense to increase taxes on the safer product more\u201d.<\/p>\n\n\n\n

\u201cA better strategy from a public health perspective would be to raise taxes on cigarettes more,\u201d he told the magazine.<\/p>\n\n\n\n

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If enacted, the proposed FET increases would have \u201ca potentially game-changing impact\u201d on nicotine pouch sales volumes in the US, writes Librarian Capital.<\/p>\n\n\n\n

The analysis predicted that Swedish Match<\/a>, the current nicotine pouch market leader in the US, would be a \u201cmajor loser\u201d if the proposal is passed in its current form.\u00a0<\/p>\n\n\n\n

However, Swedish Match\u2019s head of investor relations, Emmett Harrison, downplayed the potential impact of the US tobacco tax proposal, emphasizing it remained \u201cunclear\u201d what the final proposal might look like.<\/p>\n\n\n\n

Denmark also examining nicotine pouch tax hike<\/h2>\n\n\n\n

Speaking with Swedish financial newswire Direkt,<\/a> Harrison said that he believed a US tobacco tax hike on nicotine pouches of $8-9 per can was \u201chighly unlikely\u201d.<\/p>\n\n\n\n

\u201cIt would be counterproductive for efforts to make it easier to migrate away from cigarettes,\u201d he said.<\/p>\n\n\n\n

The US isn\u2019t the only country considering new taxes on safer nicotine products. The Danish government is also considering a massive tax hike<\/a> on nicotine pouches. <\/p>\n\n\n\n

The government\u2019s proposal would raise the price of nicotine pouches by about 11 Danish kroner per can. A budget brand can of 20 nicotine pouches currently costs around 30 kroner ($4.60).<\/p>\n\n\n\n

The stated aim of the measure is to raise prices to dissuade young people from buying the product. The bill will be considered by the Danish parliament in October with a vote expected before the end of the year.<\/p>\n\n\n\n

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