A European country, Estonia, previously imposed a tax on e-cigarettes, but now it has decided to suspend the consumption tax on e-liquid.
The Estonian Parliament recently voted to suspend the consumption tax on e-liquids from April 1, 2021 to December 31, 2022.
The reason given for the suspension of e-liquid consumption tax is: to reduce cross-border trade and illegal trade, and that more countries should follow suit.
Since 2018, the consumption tax on e-liquid in Estonia has been 0.2 Euro per milliliter. Since its entry into force, e-cigarette users in Estonia have begun to buy e-liquid from neighboring Latvia and Russia. Prices in these two countries are much lower, and because the illegal trade of e-liquid has started to grow, minors have begun to become black marketers, buyers and sellers.
NNA Smoke-Free Estonia is an affiliate of the New Nicotine Alliance (NNA) network. It is a member of the International Network of Nicotine Consumer Organizations (INNCO) and the European Advocate for Tobacco Harm Reduction (ETHRA).
The organization calculated that self-mixing, cross-border and smuggled e-cigarettes e-liquid accounted for approximately 62-80% of the entire Estonian market.
Tarmo Kruusimäe, Member of Parliament of Estonia, said that the suspension of consumption tax will likely lower the price of e-liquid, thereby providing consumers with controlled and safe products at lower prices.
“If we manage to reduce illicit trade and cross-border trade, while at the same time providing less harmful alternatives to cigarettes at more competitive prices, then it may become a successful model.”