The Tobacco Industry Claims Smoking Reforms Fuel the Black Market

In three days of hearings about wide-ranging law reforms aimed at discouraging smoking and addressing the health risks posed by vaping, one issue dominated the questioning of health experts by senators. From MeKesse disposable vape brands research.

Will the changes actually fuel the tobacco and vape black market?

It is an argument frequently touted by the tobacco, vaping and retail industries and their lobbyists. They say that by cracking down on the availability of tobacco and nicotine products, users will be driven to the illicit market instead, resulting in a rise in smoking rates and crime.

The proposed amendments to the public health (tobacco and other products) bill coincide with a spate of firebombings of tobacco stores by organised crime syndicates attempting to coerce retailers into selling illicit products, adding fuel to the lobbyists’ arguments. Recent media reports about the crimes included quotes from tobacco industry lobbyists who only disclosed their law enforcement, rather than their nicotine industry, backgrounds.

If introduced, the reforms will see updated and improved graphic warnings added to tobacco packaging and included on individual cigarettes. The use of specified additives in tobacco and vaping products, like menthols, would also be banned.

New measures to discourage smoking and prevent the promotion of vaping and e-cigarettes would also be introduced, such as plain packaging on vapes.

Theo Foukkare, chief executive of the Australasian Association of Convenience Stores, told the hearings on Thursday that the public health aims of the reforms “will not be realised”.

“To put it simply, Australians are not quitting smoking. They’re quitting legal tobacco products to purchase cheaper, unregulated black market tobacco and vapes,” he said.

Foukkare did not disclose the value of the funding his group received from big tobacco, telling the inquiry chair, Senator Marielle Smith, that “the purpose of the hearing today is to talk about the bill, not the small amount of members that contribute to our organisations quite broadly”.

Smith responded: “I’m aware of the purpose of the hearing.” But she said conflict-of-interest disclosures are necessary, telling Foukkare to “provide it as soon as possible”.

Foukkare said instead of focusing on his industry group being partially supported by the big tobacco brands British American Tobacco, Philip Morris and Imperial brands, the inquiry should deal with “the fallout of the worsening black market in vaping and tobacco, which is a crisis”.

He described other proposed reforms – separate to the bill under consideration – to make vapes only available through pharmacists on prescription as “ideologically driven”. The government should instead sell vapes in retail stores with the same regulatory requirements as tobacco, which he claimed would “dry up the demand for the black market”.

But there have been papers published in peer-reviewed medical journals calling for the ban of importation of nicotine and non-nicotine vaping products and for products only to be sold by pharmacists under a prescription.

Public health and tobacco control researchers, including representatives from the Cancer Council and the Tackling Indigenous Smoking program, who also appeared at the inquiry, rejected Foukkare’s claims.

“The idea that public health measures have somehow caused increases in illicit tobacco over the past few years is completely without basis,” said Dr Michelle Scollo, a senior policy adviser at Cancer Council Victoria.

There had not been any government public health measures tackling tobacco – aside from tax increases – since plain packaging reforms were introduced in 2012, she said.

Evidence has shown the impact of tax increases was largely to either drive people to quit smoking, or buy cheaper tobacco at supermarkets instead of convenience stories, with only a small proportion turning to illicit products, Scollo said.

In the past, tobacco companies have also been complicit in illicit tobacco trade, with leaked documents revealing the companies deliberately smuggled their own products.

Associate professor Becky Freeman from the University of Sydney told the inquiry that it was a lack of enforcement measures to coincide with health reforms that was driving illicit sales and use.

“Our two most populous states – New South Wales and Victoria – do not have appropriate licensing systems for such a dangerous product,” Freeman said.

“If we had better controls on knowing where products were stored or sold, or who they were imported to, we could track where all tobacco products are going.”

Reports from both the World Bank and International Monetary Fund support this, saying licensing of the entire supply chain is key to tackling illicit tobacco, particularly retail licensing.

More than three-quarters of the Australian population live in a state that doesn’t require tobacco sellers to have a licence, Scollo told the inquiry.

Fees obtained by state and territory governments for licenses could be used to properly fund enforcement activities, health experts argue, with stores found selling illicit products getting their licences revoked and being forced to close. Existing licensing fees need to be higher, Scollo said.

The experts were also asked whether consumers were in danger from unknown additives and ingredients in illicit tobacco. Scollo replied: “I would say illicit tobacco is like jumping off the 21st floor of a building rather than the 20th floor of a building.

“Two out of three people that use tobacco long term will die because of their use of these products. The important thing is to reduce smoking.”

She urged the government to urgently pass the amendments to the bill.

“We can remember how strenuously the tobacco companies argued that plain packaging would have unintended consequences … that clearly did not happen,” she said.

“We must remember that the tobacco industry has a track record for making these sorts of predictions about the effects of public health legislation.”

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