Babylon Vardex Group sues over illegal tax on ENDS.

Sep.22.2022
Babylon Vardex Group sues over illegal tax on ENDS.
Babylon Vardex Group sues Moscow court over central excise tax on liquid in electronic nicotine delivery systems.

The main distributor of Electronic Nicotine Delivery Systems (ENDS), Babylon Vardex Group, has filed a lawsuit with the Moscow Arbitration Court, declaring the behavior of the Central Excise Tax (CAT) as illegal. The latter demands payment of consumption tax for the liquid contained in the ENDS.


Artem Shevelin, the chief lawyer of Babilon LLC, has explained that in addition to paying consumption taxes on equipment, customs authorities are also requiring liquid consumption taxes to be paid on immersed evaporators. The size of these requirements, which relate to goods imported between 2020 and 2022, has not been disclosed. A preliminary hearing for the claim will take place between September and October.


CAT stated that all activities involving ENDS are legal. The Ministry of Finance also pointed out that a consumption tax must be paid on the liquid used for ENDS. It does not matter whether it is sold separately or as part of a package.


Market experts add that pressure on market participants will only push them into a gray area, rendering legal businesses unprofitable for suppliers and sellers alike. However, the current situation calls for a cross-departmental meeting to discuss ways to avoid potential double taxation issues.


On August 9th, the Russian Ministry of Industry and Trade proposed to advance the label test on nicotine liquids and electronic nicotine delivery systems, and to enforce mandatory labels for these products starting from November 1st, 2022.


Statement:


This article is compiled based on third-party information and is intended solely for industry communication and learning.


This article does not represent the views of 2FIRSTS, and 2FIRSTS cannot confirm the authenticity or accuracy of the article's content. The article's translation is solely intended for industry-specific communication and research.


Due to the limitations of our translation abilities, the translated article may not accurately reflect the original text. Therefore, readers are advised to rely on the original text for accuracy.


2FIRSTS is in full alignment with the Chinese government's positions and statements on any domestic, Hong Kong and Taiwan-related, and foreign issues.


5. The copyright of the compiled information belongs to the original media and authors. If there is infringement, please contact us for removal.



Disclaimer

This article is provided solely for professional research, industry discussion, and informational purposes. Any references to brands, companies, products, technologies, or policies are made for factual reporting and analytical purposes only, and do not constitute endorsement, recommendation, promotion, or advertising by 2Firsts.

Nicotine-containing products, including but not limited to cigarettes, e-cigarettes, heated tobacco products, and nicotine pouches, carry significant health risks. Readers are responsible for complying with all applicable laws and regulations in their respective jurisdictions, including age restrictions and access limitations.

The information contained in this article should not be regarded as investment, legal, medical, regulatory, or commercial advice. While 2Firsts strives to ensure the accuracy and reliability of its content, it does not assume liability for any direct or indirect loss arising from errors, omissions, inaccuracies, or reliance on the information contained herein.

This article is not intended for individuals below the legal age for accessing tobacco or nicotine-related information in their jurisdiction.

 

Copyright Notice

This article is either original content produced by 2Firsts or content reproduced, translated, summarized, or adapted from third-party sources with attribution where applicable. The intellectual property rights of the original content remain with 2Firsts or the respective original rights holders.

No individual or organization may copy, reproduce, distribute, republish, modify, translate, or otherwise use this content without prior authorization. Any unauthorized use may result in legal action.

For copyright-related inquiries, corrections, or removal requests, please contact: info@2firsts.com.

 

AI-Assisted Translation and Editing Notice

Portions of this article may have been translated, edited, or reviewed with the assistance of artificial intelligence tools to improve efficiency and readability. Due to the limitations of AI-assisted translation and editing, discrepancies, omissions, or inaccuracies may exist when compared with the original source.

Where applicable, readers are advised to refer to the original source for the most complete and accurate information. If you identify any errors or believe that any content infringes upon your rights, please contact us at info@2firsts.com, and we will review and address the matter promptly.

Special Report|Virginia Vape Directory Shows Contrast Between Vuse and JUUL Pod Systems and CrossBar 20K, Loon Flavored Disposables
Special Report|Virginia Vape Directory Shows Contrast Between Vuse and JUUL Pod Systems and CrossBar 20K, Loon Flavored Disposables
A 2Firsts analysis of Virginia's liquid nicotine and vapor product certification directory identified 213 product records from 15 manufacturers. Companies associated with BAT, Altria, Imperial Brands, JTI and JUUL account for 127 entries. The directory also includes independent brands CrossBar 20K, Loon and Breeze. CrossBar advertises a 13mL disposable capable of up to 20,000 puffs, while Loon has 16 disposable entries featuring fruit, cooling and beverage-related flavors. Of all records, 120 are labeled as under FDA PMTA review. Virginia introduced revised penalties on October 1, 2026, including a minimum first-violation civil penalty of $5,000 per unlisted product, alongside new retail tobacco permitting requirements.
Regulations
Oct.30
Beyond IQOS ILUMA, PMI Expands Lower-Priced BONDS Heated Tobacco Platform: Seven Markets Added in Q3, With Rollouts in Japan, Europe and North Africa
Beyond IQOS ILUMA, PMI Expands Lower-Priced BONDS Heated Tobacco Platform: Seven Markets Added in Q3, With Rollouts in Japan, Europe and North Africa
Philip Morris International (PMI) is expanding the international footprint of BONDS by IQOS, its lower-priced heated tobacco platform. The company's third-quarter 2026 SEC filing shows that BONDS devices and BLENDS tobacco sticks were available in 15 markets at the end of September, up from eight at the end of June. In November, PMI announced plans to extend sales from three to 17 Japanese prefectures and introduced BONDS in Spain and Morocco. The platform uses ROUNDHEAT external heating technology and proprietary tobacco sticks, separate from the IQOS ILUMA system. In Japan, BONDS retails for ¥2,980, approximately 25% below ILUMA i ONE, while BLENDS costs ¥570 per pack. PMI management says BONDS targets cigarette smokers who have not adopted heated tobacco. Separate sales and revenue figures remain undisclosed.
company
Nov.06
2Firsts First Look|China to End VAT Export Rebates on Vape Devices and Nicotine in April 2027, Following Earlier Removal for HTP Devices and Nicotine Vapes
2Firsts First Look|China to End VAT Export Rebates on Vape Devices and Nicotine in April 2027, Following Earlier Removal for HTP Devices and Nicotine Vapes
China's Ministry of Finance and State Taxation Administration announced on October 12, 2026, that value-added tax (VAT) export rebates for vape devices, nicotine and its salts, and certain non-combustible inhalation products will be eliminated from April 1, 2027. The measure adds four tobacco- and nicotine-related customs codes, including 8543400010, which covers vape devices and qualifying empty pods. China previously eliminated rebates for nicotine-containing vaping products and devices under code 8543400090 in April 2026. According to industry classification information held by 2Firsts, the latter currently corresponds to heated tobacco devices. Export excise tax refund and exemption arrangements will remain unchanged.
Special Report
Oct.12
Product | BAT Launches VELO WRKS Nicotine Pouches in Sweden, Introducing Dual-Compartment Cans With Two Flavours
Product | BAT Launches VELO WRKS Nicotine Pouches in Sweden, Introducing Dual-Compartment Cans With Two Flavours
British American Tobacco (BAT)'s VELO brand launched the VELO WRKS nicotine pouch range in Sweden on November 2, 2026. The initial release features three Dual Can variants, each containing two separate flavours in a dual-compartment container. Each can holds 20 slim pouches with 8mg of nicotine per pouch and retails for SEK 52.99. According to VELO, the first release, Drop 1, is limited to 75,000 cans and will remain available until February 2027 or while stocks last. VELO positions WRKS as a platform for testing new product concepts and has introduced an online consumer feedback survey. EU trademark records show BAT applied to register VELO WRKS in March 2026 under Class 34, covering nicotine pouches, e-cigarettes, heated tobacco products and other tobacco-related goods.
product
Nov.03
Why AIRSCREAM Built its European Production Hub for Regulated Market Growth
Why AIRSCREAM Built its European Production Hub for Regulated Market Growth
AIRSCREAM’s production hub in the Czech Republic brings nicotine pouch manufacturing, e-liquid bottling, product documentation, warehousing and international logistics into one operation, giving brands and commercial partners a practical platform from which to launch, expand and enter new markets.
Market
Sep.16 by 2Firsts Perspectives
Russia Expands Temporary Administration of JTI Assets in Second Round: From Four to All Seven Russian Entities, With Approximately $9.5 Billion in Related Assets
Russia Expands Temporary Administration of JTI Assets in Second Round: From Four to All Seven Russian Entities, With Approximately $9.5 Billion in Related Assets
Japan Tobacco Inc. (JT) confirmed on November 9, 2026, that all seven of its Russian entities had been placed under temporary administration after a second presidential decree added three companies to the four designated a day earlier. The additional entities are associated with importing, management, holdings and the former supply of Ploom heated-tobacco devices. JT disclosed approximately ¥1.5 trillion in Russian business-related assets as of September 30, including ¥360 billion in cash and deposits, and approximately ¥200 billion in liabilities. Under its revised FY2026 forecast, Russia accounts for about 25% of adjusted operating profit. JT said operations in Russia were continuing, while the financial impact remained under assessment.
company
Nov.09