The Economic Impact of Banning E-Cigarettes in Russia

Jul.26.2022
Proposal to ban e-cigarettes and nicotine liquids could cost Russia up to 30 billion rubles in lost revenue.

As of June 23, 2022 at 11:59, this type of product accounted for approximately 22.1% or 37.4 billion rubles of total tobacco product sales.


On June 23rd, Moscow - Sibinfo reported that the Russian economy has been undergoing severe stress tests since March 2020. Lockdowns, restrictions, and layoffs have all affected the financial system in various ways.


However, it appears that these efforts are largely coming from representatives who are not part of the Democratic Republican faction, as they have submitted a bill to the National Duma that proposes a complete ban on the sale of e-cigarettes and liquid nicotine products in the territory of the Russian Federation.


At first glance, such an initiative may seem harmless, even beneficial, they say, "Look - representatives care about the country's health.


Let's start with a fact: if our so-called "representatives of the people" care, it's only about themselves. The transition away from electronic cigarettes could result in a loss of 30 billion rubles for the Russian budget, not including revenue from sales tax and liquid nicotine (o).


In addition, as you may be aware, the sale of electronic cigarettes, which have long been suffering from negative publicity, is not limited to independent sales outlets. It is actually a significant part of the wider industry, with almost 20,000 citizens in China making up its economic base. Consequently, this sector generates billions of dollars in revenue.


Experts have identified the value market of electronic nicotine delivery systems, tobacco heating systems, and electronic cigarettes to be around 2.5 billion USD in 2022. Based on the results of 2021, this figure ranges from 62 to 70 billion rubles. ESDN products, excluding heating systems and sticks, make up 22.1% of total tobacco sales, amounting to 37.4 billion rubles.


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