Today, and Ordinance issued TAR Lazio (Regional Administrative Court) suspended the e-cig tax on liquids without nicotine and sent the entire legislation to the Constitutional Court, which last April struck down the previous fiscal regime. Legislative Decree n. 188/2014, followed by a AAMS (Monopolies Agency) Provision, established a € 3,73 +22% VAT tax per 10ml of liquids with or without nicotine. The level of taxation has been decided by AAMS after an evaluation of the equivalence in terms of smoking time with respect to the traditional cigarettes, despite the absence of any industrial or scientific standard to evaluate such an equivalence. The existing law is based on the same framework of rules that the Court declared unconstitutional (i.e. equivalence with tobacco, excess of taxation, violation of the right to health, excess of power).
Mr. Massimiliano Mancini, president of Anafe Confindustria (the producers trade association) sounds satisfied, but not too much. “Unfortunately, it’s like watching againg the same movie, given the reasons of the decisions, which confirmed what the Court already said several months ago. We wasted a huge amount of time and money. This and theprevious tax system blocked all the investments and the growth, it’s a pretty unique situation“.
“The failure of the existing tax model is confirmed by the numbers. The Government expected 115 millions for 2015, while last July it cashed in just Euros 3.5 million, and this because the market flew abroad due to the excess of taxation“, Mr. Mancini added. “Our companies lost competitiveness, and the Italian consumers have been damaged by high prices and lack of choices. All this only favoured the illicit market and tobacco products“.
The decision arrived in the very same day in which UK’s PM David Cameron expressed his favour for the e-cigs as a legitimate method to quit. The same Cameron that two years ago fired his election strategist for his connections to Philip Morris. At the opposite, Italy’s PM Matteo Renzi went public several times (signatures of agreements, conferences, photo opportunities, etc.) to support PMI’s activities, investment and product (i.e. the “heated tobacco” iQOS, which obtained a favourable fiscal regime), while at the same time damaging the e-cig sector. It must not be by chance that PMI recently filed a document to the House of Commons for the approval of an e-cig tax in UK as well…
In these days, the Italian Parliament is working on the 2016 Budget Law. “We hope that the Government could find a way to act immediately, introducing a fair tax based on nicotine. But, the continuos judicial decision against the past provision should make the Government think about what was wrong, hoping that this time imaginative and inapplicable solutions will be avoided“. Mr. Mancini stated.