How do you bring American manufacturing to an industry that could be wiped out by government over-regulation in the next four years?
Short answer: Absent real regulatory reform, you don’t.
That was the message AVA President Gregory Conley and five other harm reduction advocates brought to Washington D.C. on July 24, 2018, when a public hearing was held before the Section 301 Committee of the Office of the United States Trade Representative (USTR) on President Donald Trump’s second set of proposed tariffs on a variety of products imported into the U.S. from China.
Vaping advocates had previously breathed a sigh of relief when the first round of President Trump’s increased tariffs on Chinese-made products did not impact vaping products. Regrettably, the trade war between the U.S. and China has not subsided since then, and in June and July, President Trump announced a second and third set of tariffs. Both packages contain provisions that would make it more expensive for adult smokers to switch to vaping.
As it stands today, enactment of President Trump’s proposed tariffs will result in all e-cigarette devices and parts (likely pods, tanks, coils, cartridges, batteries made for usage in vaping products, etc.) imported from China being subject to a tariff of 25% (or, more accurately, an import tax of 25%). The costs of this tax will inevitably be passed along to consumers in the form of higher costs.
At the hearing, the committee heard thirty minutes of testimony from six harm reduction and industry advocates about the severe harm to small businesses and public health that would result from these tariff hikes. As pictured above, giving testimony were Arnaud Dumas de Rauly (Blinc Group), Brittani Cushman (Vapor Technology Association), Carrie Wade (R Street Institute), Guy Bentley (Reason Foundation), Gregory Conley (American Vaping Association), and Tracy Musgrove (vape shop owner — Revolutionary Vapes in Williamsburg, VA).
AVA’s testimony focused on three main points:
- Vaping products are far less hazardous than smoking and helping smokers quit. Price hikes at the retail level will deter current smokers from switching.
- There is a great need for clarity about exactly what products will be subject to this tariff. (This point is now less critical since the Trump Administration announced that it would also be seeking to subject e-cigarette parts to the 25% tariff hike, rather than the 10% rate originally proposed.)
- FDA Commissioner Scott Gottlieb has thus far failed to enact real regulatory reform at the FDA Center for Tobacco Products. The vaping industry is not only banned from introducing new products, but also facing near-extinction in August of 2022 because of extensive and enormously expensive regulatory requirements. As such, there is little chance that American manufacturers would be able to attract the tens of millions of dollars in capital investments that would be required to domestically produce significant quantities of vaping devices.
AVA’s comments on the proposed tariffs were included in two Bloomberg reports and in an Op Ed published at Inside Sources by Michael McGrady.
Read our written testimony: AVA Tariff Testimony — Section 301 Committee
