A survey of more than 200 professional tobacco traders in South Africa has revealed that the vast majority of them oppose the new Tobacco Products and e-Cigarette Regulation Bill, which was recently tabled in Parliament. Brand distributor Clippa Sales said in a press release that FLOW-wrap: break-word! important;” The bill proposes a total ban on the display and display of tobacco products and related products, including e-cigarettes, cigarettes, cigars, and hookahs.
The press release said the bill would hurt small businesses that sell only those tobacco products. In response, professional tobacconists have called for international precedents to exempt professional tobacconists who sell only these categories and not others from such bans.
98% of respondents to the survey, which covered 1,769 stores employing 3,194 people, opposed the display ban, saying it would seriously affect sales. Seventy-five percent said the bill would criminalize legitimate businesses that work hard, 86 percent said it would hurt the lives of employees who rely on small businesses,
96% of respondents also said the display ban would lead to more illegal trade. At present, the illicit trade accounts for about 60% of the total tobacco market in South Africa. It is clear from the survey of specialty tobacco products stores that in most cases, a total ban on displaying the only tobacco products sold in their stores would pose an existential risk to the store’s business.
Diane Bravo, head of specialist tobacco retailer Casa Tabacs, called on the South African government to consider the economic impact of the bill and work with the tobacco industry to find a balanced and sensible approach to tobacco regulation in South Africa.
The public consultation on the Tobacco Products and e-Cigarettes Regulation Bill mentioned above will end early on July 28 (the previous end time was set for August 4), and the bill mainly includes the following:
Regulate the sale and advertising of tobacco products and e-cigarettes;
Regulating the packaging and appearance of tobacco products and e-cigarettes;
Develop standards for the manufacture and export of tobacco products and e-cigarettes;
Ban the sale of tobacco products and e-cigarettes to children;
Ban the free distribution of tobacco products and e-cigarettes;
Banning the sale of tobacco products and e-cigarettes through vending machines;
The announcement of this bill has attracted a lot of different voices in South Africa’s tobacco industry. Some people think it is inappropriate to confuse traditional tobacco products with e-cigarettes. People in the tobacco industry think the bill will affect their business; Others say the bill will have a negative impact on South Africa’s finances, which are heavily dependent on the tobacco industry.
The challenges of e-cigarette regulation in South Africa do not end there.
South Africa introduced an excise tax on e-cigarettes on June 1, 2023, at a rate of 2.9 South African rand/ml. Manufacturers have until June 1 to apply for production licenses for their businesses. The direct impact of this is that the retail price of e-cigarettes in South Africa has increased significantly.
Barry Buchman, managing director of South African e-cigarette retailer Vaperite, estimated in an interview in mid-June that the price of a 30ml bottle of nicotine salt-liquid would rise from about 180 South African rand per bottle to 280 rand per bottle. A 100 ml bottle of free base liquid will increase from the previous price of 280 South African rand per bottle to 613.50 South African rand per bottle, an increase of more than 100%.
To that. The CEO of the South African e-Cigarette Products Association (VPASA) pointed out in an interview in May that the South African e-Cigarette Products Association expects that the demand for e-cigarette oil will be reduced by 26% after the introduction of excise duty.
In summary, if South Africa finally passes the current version of the “Tobacco Products and electronic Cigarettes Regulation Act”, coupled with the factors of the introduction of excise tax before, the sales of electronic cigarettes in the compliance market may decline significantly in the future.