Australia should legalise nicotine vapes and regulate them as adult consumer goods – Report

Posted on October 26, 2022 By Colin

A NEW REPORT recommends that Australia should legalise nicotine vaping products and regulate them as adult consumer goods. [link]

The report by London-based Llewellyn Consulting was commissioned by British American Tobacco and examined the economics of different regulatory options. It concluded that

Legalisation and regulation is the most workable approach to addressing the rampant sale of illicit vaping products in Australia

The suggested model would

• Enable the government to properly monitor and regulate vaping products
• Generate nearly $200 million per year from GST. The estimated cost per user would be $200 annually
• Save Medicare costs of up to $45 million per year

Under the proposed scheme, nicotine vaping products would be sold as adult consumer products by licensed retail outlets such as vape shops, convenience stores and tobacconists with strict age verification.

The current model is not working

The review recognised the explosion in black market vaping products in Australia which is expected to increase further, in spite of Australia having "one of the world’s most restrictive laws on nicotine vaping."

Take up of the current prescription-only model ‘is very small, few doctors offer the service, and most are reluctant to do so”

A more open market would address the current problems:

• Poor compliance with packaging and warnings
• No monitoring of ingredients, device and electrical standards
• The loss of taxation (GST) revenue
• The proceeds from lucrative illegal activities are often used to fund additional criminal ventures (as seen in the illicit tobacco trade)

Alternative options are less effective

The report concludes that other ways to control illicit vaping will not be effective.

• Attempting to reduce importation “is extremely challenging” and resource intensive. The volume and complexity of Australia’s international trade makes it difficult to intercept and monitor concealed consignments of this nature.”
• Bolstering the current Medicare-based prescription scheme is “likely unworkable”. The take-up of the prescription scheme is minimal, with acceptance from GPs and patients in Australia markedly low. This also involves a substantial cost to the Medicare system.

A win-win solution

This report only examines the economic aspects of regulation.

But even more important is the benefit to public health of ensuring a safe, regulated and legal supply of vaping products to adult smokers, which would also restrict access to young people

The case for a legalized and regulated consumer market for nicotine vapes in Australia is clearly established for both economic and health reasons. It is now time for the Australian government to act

Report

Tobacco and vaping products in Australia: an economic assessment. Llewellyn Consulting. October 2022