There is much uncertainty ahead for the tobacco industry in Israel, particularly because of questions around cannabis legislation and taxation. For several years, government officials have been discussing the need to regulate the cannabis industry because of the prevalence of illicit trade.
After the increase in tax for e-vapour liquids at the beginning of the year, adjusting the tax to align with that of cigarettes and fine-cut tobacco, the Israeli Government decided to reduce tax on the former once again as it is considered less harmful to health. In addition, the move to equalise taxation between cigarettes and fine-cut tobacco, means that the latter is now much less affordable for price-sensitive local consumers, which will likely impact sales in the coming years.
The distribution landscape is set to favour small local grocers and food/drink/tobacco specialists over the forecast period, although e-commerce has ongoing scope for growth.
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Cigars, Cigarillos and Smoking Tobacco
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