All but uniquely among fmcg industries, tobacco legislation is not simply a guiding element or a means of enforcing consumer standards but a central determining factor in the performance of tobacco markets. As the cumulative de-normalising impact of regulation and taxation drives down smoking prevalence worldwide, regulators are looking to the margins, towards next-generation measures that impair the revenue-generating capacity of manufacturers and further restrict access to tobacco products.
This report comes in PPT.
Since December 2012, when Australia became the first country in the world to fully implement plain packaging regulations, 18 more across regions have followed suit. A growing number of countries are now also openly considering the measure and it is likely to be extended to other categories such as e-vapour and heated tobacco.
The menthol ban on cigarettes was already implemented in the EU on 20 May 2020 and this measure is likely to be enforced in the US in the near future. This adds further momentum to flavour restrictions that could be replicated across other countries and be extended to other category products such as flavoured e-vapour products, that are suffering closer scrutiny globally.
With international tobacco manufacturers increasingly openly referring to a near future in which the combustion of tobacco is no longer mainstream, taxation of potentially reduced risk products is likely to reshape the tobacco industry globally. The US and the EU are already taking the first steps in e-vapour and heated tobacco legislation that might lead not just to further taxation but also stricter provisions in terms of product use.
The potential introduction of more aggressive measures to tackle smoking prevalence, in particular the birth year ban, is likely to put further pressure on tobacco sales. Plans to phase out smoking by gradually raising the legal age or adding written health warnings printed on individual cigarettes are expected to resonate well across countries and to spread globally, accelerating the shift away from combustible cigarettes where novel tobacco products are allowed and not subjected to the same legal framework as cigarettes.
Passport Tobacco covers the seven major tobacco categories: Cigarettes, Cigars & Cigarillos, Smoking tobacco (made up of Pipe tobacco and RYO tobacco), Smokeless Tobacco (snuff and chewing tobacco), E-Vapour Products (closed and open); Heated Tobacco; and Tobacco Free Oral Nicotine. Smoking paraphernalia such as pipes, rolling papers, lighters or matches, etc., are not included, nor are nicotine replacement therapy (NRT) products, which are part of Euromonitor's Passport Consumer Healthcare database.
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