China Hit with US Tariffs on Vaping Products

Vaping in America isn’t as easy as it is in selected other countries around the world (such as the UK, for example). Now comes news of yet another change in regulations that will hit US vapers.

Take note of the date, 23rd August 2018. That was the day when new vape tariffs brought in by the Trump administration came into play. These have been applied to vaping products brought into the US from China. The tariffs consist of a new tax of 25% on vaping products. The tax covers electronic cigarettes, the batteries that power them, and similar items.

What’s the idea behind the new tariff?

The principle is simple enough to understand. Let’s say you have a choice of purchasing a US-made electronic cigarette or one that was made in China and imported into the US for sale. The US-made version wouldn’t be subjected to the new 25% tariff. The Chinese one, meanwhile, would be slapped with the new 25% tax.

That 25% will make a hefty difference to the likely price that will eventually be charged for the Chinese version of the e-cig or similar device. The idea is that American-made vaping devices will be cheaper and more appealing to businesses selling them. The price will also likely be more appealing to US vapers wanting to buy a new electronic cigarette.

Therefore, the import tax will make US-made vaping devices far cheaper and more economically attractive, and hopefully bigger sellers too. That sounds great for US-based businesses… however, it doesn’t tell the full story.

Could there be higher prices for US vapers to pay in future?

This could well happen as an unlikely consequence of what might initially seem a good idea. As Gregory Conley, president of the American Vaping Association, pointed out, the US production of vaping products is hardly significant. With most vaping products coming into the country from China and elsewhere, vapers throughout America are likely to see a rise in prices.

This probably won’t happen straightaway. However, once existing stock is sold, and US businesses look to China for their next imports, the additional costs will undoubtedly come into play. Some products already have a small profit margin. Trying to absorb the new tax will eat into most if not all that margin. It is clear prices will increase, hitting the American consumer in the pocket.

Those consumers are also likely to suffer if vape shops end up closing because the owners cannot survive, whether that is through lower profit margins or customers who will not pay the new prices. There are always cheaper alternatives, including online vape shops.

But surely only part of the vape product line is affected?

True – for now. The new tariffs only apply to specific items. But more tariffs are being brought in soon as well, targeting other vaping products. And if prices rise across the board, American consumers may think twice about switching from smoking to vaping. Currently, there is a lot of money to be saved from that switch, aside from the positive health implications. If these new tariffs begin to close that gap, wiping out some small businesses in the process, health could suffer just as much as the US vaping industry.

What do you think about the new tariffs coming in against Chinese vaping products? If you live in the US, how are you going to be affected by the new prices? Could they prompt you to forget vaping altogether, if you are still considering whether to make the switch? Please leave your comments on this topic below.