New laws on tobacco and vaping are another step towards bootleg Britain

    20 May 2016

    It is a reflection of the EU’s democratic deficit that smokers and vapers have only recently become aware of a Brussels directive that will directly affect them. The public shouldn’t feel too bad about being kept in the dark. David Cameron and several members of the House of Lords didn’t know much about it either. Nor did Anna Soubry, and she was minister for public health when the directive was passed.

    The Tobacco Products Directive, which comes into force today, regulates tobacco and e-cigarette products down to the last detail. Packs of ten will be banned. Most e-cigarette advertising will be banned. High strength e-cigarette fluid will be banned. Large tank e-cigarette devices will be banned. In 2020, menthol cigarettes will be banned. As if that were not enough, the UK is gold-plating the directive today by introducing so-called plain packaging.

    What effect will this frenzy of legislation have on consumers? In the short term, not much. Retailers are allowed to sell old stock until May 21 2017 and there is certain to be old stock available for most of the next year. After that, however, vapers will be faced with less choice and inferior products while smokers will be forced to buy larger packs of cigarettes in silly packaging.

    I have written about the e-cigarette regulations before so let’s look at what’s happening with tobacco. The ban on packs of ten is particularly bizarre. Nudge theorists such as Cass Sunstein recommend that governments force tobacco companies to sell cigarettes in smaller packs because smokers use them as aids to self-restraint. The EU is doing the exact opposite, forcing smokers to keep plenty of cigarettes on them and reducing the number of times they need to make the conscious decision to buy tobacco from a shop. At a time when ‘public health’ campaigners are demanding smaller chocolate bars, their anti-smoking colleagues are demanding larger servings of tobacco. Such is the prohibitionist zeal of the nicotine nannies that even this patently nonsensical ban has been welcomed by the likes of ASH.

    Then there is plain packaging, a policy that rose to prominence for no apparent reason other than the anti-smoking lobby needing something to justify its continued existence at taxpayers’ expense. The evidence put forward for it has never amounted to more than asking focus groups if they find ugly packaging ugly and it remains an awkward fact for its proponents that cigarette sales in Australia rose for the first time in years as soon as the old Labor government introduced it. Smokers have been clobbered with tax hikes ever since in an effort to force sales back down.

    If you believe that people start smoking because of colour schemes and logos, the idea of turning cigarette packs olive green might not seem entirely absurd. If, on the other hand, you are on nodding terms with reality, the only obvious consequences of plain packaging are that counterfeiters will have their costs lowered and smokers who want their cigarettes in familiar branded packs will turn to the black and grey markets.

    HMRC says the illicit tobacco market has risen by 24 per cent in the last five years. It currently amounts to £2.1 billion in lost tax revenue. Such figures are only guesstimates, however, and the black market could be even larger.

    Considering the scale of the tax gap, it is surprising that HMRC does not try harder to get reliable figures. In the old days, the government collected empty cigarette packs at football matches to see how many of them came from the UK. Budget cuts put an end to that, but thanks to plain packaging the true scale of the problem could soon become obvious to anyone who frequents a beer garden.

    This time next year, any cigarette pack you see that is not in plain packaging will have been bought abroad or on the black market. The same will be true of any menthol cigarette you see after 2020, not to mention all the vaping fluids and paraphernalia that are being outlawed by the EU. By necessity, Britain is becoming a nation of bootleggers. One unintended consequence of plain packaging will be that this becomes visible to all.