Japan’s Emerging IQOS Tobacco Sticks Are Taxable, Customs Steps Up Raids
As Hong Kong moves to regulate vaping products, Japan’s IQOS heated tobacco sticks have created new tax and customs challenges due to the rapid evolution of tobacco product formats and components.
The Hong Kong government is preparing to introduce legislation to regulate e-cigarettes, but the range of products on the market keeps evolving. In recent years, Japanese IQOS heated tobacco products have also appeared, and whether the new rules can keep up with the rapid changes in the ingredients and components of e-cigarettes has become the biggest challenge. The Food and Health Bureau said that, in view of new tobacco products being developed by tobacco companies, the authorities will study how to make the law more flexible, and hopes this legislative amendment will bring e-cigarettes and other new tobacco products under the same regulatory framework.
IQOS heated tobacco products use an electronic heating device to heat tobacco sticks, and are claimed to operate at a lower ignition point and release fewer chemicals. Because the tobacco sticks contain tobacco, bringing them into Hong Kong is subject to the Dutiable Commodities Ordinance and they are classified as dutiable goods. Customs has recently handled a number of suspected cases involving unpaid-duty heated tobacco products.
In several shopping malls and centers in Mong Kok where IQOS heated tobacco products were once sold, vendors have switched to selling only the heating devices because of intensified customs enforcement, with prices ranging from HK$800 to over HK$1,000. An on.cc reporter recently visited these malls and found tobacco sticks hard to come by. Pretending to be a customer at one shop, the reporter asked whether tobacco sticks were sold together with the device. A female staff member said the tobacco sticks had to be purchased separately: “You won’t find tobacco sticks on the Hong Kong market now, because they’re illegal.”
So will this type of heated tobacco product also be regulated under the new law in the future? The Food and Health Bureau said it has noted that tobacco companies have developed new heat-not-burn tobacco products, claiming them to be a hybrid of conventional cigarettes and e-cigarettes. However, it stressed that such products contain real tobacco and, like conventional cigarettes, contain carcinogens. The bureau will closely study different regulatory approaches in order to formulate a more flexible e-cigarette policy.
