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Tumbling tobacco taxes have lit a fire under anti-vape campaign, says e-cig firm

Falling tobacco taxes have sparked an anti-vaping campaign, according to new analysis.

US states are paid revenues based on cigarette sales annually by tobacco companies under a settlement which promises them over 200 billion dollars.

But latest research from a leading UK e-cigarette company, shows that many US states who receive this cash have used the revenues to finance tobacco bonds.

California, which receives the most money, is behind on its tobacco bond payments and has spent 75 million dollars on a campaign to demonise vaping, according to ecigarettedirect.co.uk.

States need to pay up to 76 times the amount they originally borrowed despite lower revenues.

And while Public Health England estimates vaping is around 95% safer than smoking, it still receives negative press from US states who face billions of dollars in losses from these revenues, and in some cases face effective bankruptcy.

States are supposed to spend a portion of this money on smoking prevention and treatment of related diseases, but many have reinvested cash back into tobacco production.

James Dunworth, chairman of E-Cigarette Direct, said: “Vaping is a disruptive industry which threatens over USD700 billion in worldwide tobacco revenues and USD250 billion in tax revenues. It would be naive to think that those threatened by vaping would take no action.

“Negative stories around vaping are keeping smokers smoking, and need to be viewed with a sceptical eye rather than being taken on blind faith.”

BLOG: https://www.ecigarettedirect.co.uk/ashtray-blog/2019/05/vaping-lost-tobacco-revenue.html 

Origional sourcr: PRFire.com

Could Falling Tobacco Taxes Be Behind Anti-Vaping Campaign?

While Public Health England estimates vaping is around 95% safer than smoking, vaping has seen a steady stream of negative stories hitting the headlines. Many of these stories are coming from US states who are facing billions of dollars in losses from tobacco revenues, and in some cases could face bankruptcy.

US states are paid revenues annually by tobacco companies under a settlement which promises them over 200 billion in dollars. But these revenues are based on cigarette sales, and the fewer cigarettes sold, the less money the states receive.

States are supposed to spend a portion of this money on smoking prevention and treatment of smoking diseases, but in some cases states have chosen to reinvest this money back into tobacco production.1

An analysis by E-Cigarette Direct shows that many of the states who receive money from the tobacco companies have used the revenues to finance tobacco bonds. 2 These states need to pay up to 76 times the amount they originally borrowed despite lower revenues. 3 Moody’s estimate 80% of these bonds are likely to default, leading to interest penalties, lowered credit rates and even possible bankruptcy. 4.

Many of the negative publicity around vaping has originated from the very states likely to suffer most from falling cigarette sales. For example, California receives the most money from tobacco companies, is behind on its tobacco bond payments and has spent 75 million on a campaign to demonise vaping. 5

James Dunworth, Chairman of E-Cigarette Direct, said:

“Vaping is a disruptive industry which threatens over USD700 billion in worldwide tobacco revenues and USD250 billion in tax revenues. It would be naive to think that those threatened by vaping would take no action. Negative stories around vaping are keeping smokers smoking, and need to be viewed with a sceptical eye rather than being taken on blind faith.”

1. https://www.washingtonpost.com/blogs/govbeat/wp/2014/08/09/how-wall-street-struck-tobacco-deals-that-left-states-with-billions-in-toxic-debt/

2,3,4. https://www.ecigarettedirect.co.uk/ashtray-blog/2019/04/vaping-lost-tobacco-revenue.html
5.https://www.atr.org/california-department-public-health-launches-75-million-campaign-discourage-vaping

Original source PRFire.com