Russian Temporarily Stop Of Ban Vape Due Consider Of Fiscal Revenue

Russian Temporarily Stop Of Ban Vape Due Consider Of Fiscal Revenue

TASS reported that the Russian government has temporarily suspended the comprehensive ban on vapes, mainly due to considerations of fiscal revenue. The Ministry of Finance expects that the new consumption tax policy implemented from March 2025 will bring 156 billion rubles (approximately 2 billion US dollars) in revenue to the national budget within two years. The health department has clearly pointed out the harm of vapes to public health, but the financial, economic, and regulatory departments tend to “control but cannot help” in the multi-party game.
One of the important market regulatory measures launched by Russia at the end of 2022 is the honest labeling of vapes and their e-liquids. The purpose of this measure is to “legalize” the vape industry and protect the public from the harm of counterfeit nicotine. According to the Center for Advanced Technology Development (CRPT), after this requirement was introduced, the number of legal sales points almost doubled.
According to Article 15.12 of the Administrative Violation Code, selling unmarked vapes will be punished, and for legal persons, a fine of 300000 rubles (approximately 3761 US dollars) will be imposed; For crimes with particularly large scale or conspiracy, a fine of 400000 to 800000 rubles (approximately 5015-10000 US dollars) or up to 6 years in prison and a fine of up to 1 million rubles (approximately 12000 US dollars) shall be imposed.
In addition to labels, sellers of “electronic products” must also comply with the requirements of the law passed in April 2023. According to the law, the selling price of nicotine containing products shall not be lower than the minimum price set by the government. In addition, the sale of vapes to minors, including nicotine free vapes, is completely prohibited. It is prohibited to advertise and demonstrate the use of such products, as well as to publicly display them in retail stores.

The comprehensive ban is temporarily put on hold

In 2024, a group of legislators led by Yaroslav Nilov, Chairman of the Labor, Social Policy, and Veterans Affairs Committee of the State Duma, proposed a more radical initiative: a complete ban on the sale of vapes. The bill was submitted to the lower house of parliament in May 2024.
Although certain bans on the sale of vapes have been established, these bans are easily circumvented and minors continue to purchase vapes, “the statement of the bill reads. In order to save the country, we believe it is necessary to completely ban the sale of vapes at the federal level. The bill never entered first reading.
The website of the State Duma has published the conclusions of the Joint Executive Committee (Youth Policy Committee and Family Protection Committee) and the legal department. The First Committee welcomes the bill, but requests consistency in its terminology. The Second Committee acknowledges that there have been cases of deaths from vaping in Russia, but also recommends amending the document. The legal department pointed out that the proposed amendment conflicts with the provisions of Section 19, Parts 1-7 of the federal law, which allow for such trade but impose restrictions on its implementation.

Seeking a balance of interests

The drafter of the suspended bill acknowledged in the statement: “According to data from the Russian Ministry of Finance, as of January 1, 2023, the consumption tax revenue for the above-mentioned goods reached 6.4 billion rubles (approximately $80.07 million).” In 2024, the consumption tax doubled. The amendment to this bill will come into effect from March 2025.
According to calculations by the Ministry of Finance, the consumption tax on nicotine raw materials and nicotine free tobacco products implemented from March 1, 2025, will bring an additional revenue of 156 billion rubles (approximately 2 billion US dollars) to the national budget over the next two years. Perhaps the risk of a significant reduction in budget revenue is one of the reasons why the bill has been put on hold.
Yaroslav Nilov told TASS News Agency, “The government and the State Duma are discussing the development of a comprehensive resolution aimed at taking into account the opinions of numerous stakeholders. Currently, the political process is underway, and the positions of all parties are converging. The Ministry of Health believes that vapes are harmful to health and can shorten lifespan. The heads of the economic and financial departments have stated that vapes are taxable products, that is, budget revenue. At the same time, the ban will also lead to the import and distribution of counterfeit goods, although research shows that the market is already filled with counterfeit goods, which have caused damage to public health and the national economy.

Not childhood lollipops

Although a comprehensive ban has not yet been decided, Yaroslav Nilov’s colleagues are proposing new measures aimed at reducing the appeal of vape. Therefore, Ksenia Goriachova, a member of the State Duma from the New People’s Party, sent a letter to Prime Minister Mikhail Mishustin proposing to require vape product manufacturers to use single color low tone packaging.
Redesigning packaging is not a panacea, but it is an important step. When the packaging of vape looks like childhood lollipops, we not only need to sell the product, but also target children with targeted advertising. Of course, we need education programs, stricter sales controls, and psychological and social assistance for people who are already addicted, “said Ksenia Goriachova.
Ksenia Goriacheva expressed her support for the idea of completely banning the circulation of vapes. Meanwhile, she pointed out that it is crucial to avoid plunging the market into darkness. We also propose a gradual and comprehensive ban on the sale of nicotine containing products to people born after 2009. This way, children will have no time to develop bad habits. This is a global change, and we are working together with experts and colleagues. We also understand that the age limit needs to be lowered again, “she added. According to her introduction, these measures are currently being formulated, with the primary task of restricting access to vapes, reducing their appeal, and controlling their quality.
The Chairman of the Youth Policy Committee of the Russian State Duma, Artem Mendeleev, also proposed a similar initiative. Recently, he wrote to Anton Sharaev, the director of the Russian Standards Agency, requesting him to consider amending the regulatory regulations of the Russian National Standards Agency on the production of nicotine containing e-liquid for vapes. The deputy director proposed to require manufacturers to affix warning labels on the packaging of vapes and nicotine containing e-liquid, informing consumers of the dangers of using these products, similar to current cigarette regulations.
According to Ksenia Goriacheva, the government has not yet replied to her letter. The deadline has not yet passed. The labeling and registration issues of nicotine containing products are currently a focus of attention for multiple institutions, and I hope the government can take similar measures, “she said.

Russian men who don’t smoke vapes are also cool

Another initiative comes from a group of members of the Liberal Democratic Party (LDPR). Under the leadership of party leader Leonid Slutsky, they submitted a bill to the State Duma to ban the use of “substances aimed at increasing the attractiveness of such products, including food flavorings and additives that increase nicotine addiction,” in the production of e-liquids.
The explanatory document states that from September 1, 2023, the government has been granted the power to determine the list of allowed substances for production, but this power has not yet been implemented. Experts emphasize that one of the reasons why the list of such substances has not been determined is that the Eurasian Economic Commission is developing a draft technical regulation for nicotine containing products in the Eurasian Economic Union. Once the regulation is passed, it will provide a universal list for all member states of the Union, listing substances that cannot be used to produce nicotine containing and nicotine free e-liquid.
Leonid Slutsky stated that he supports a comprehensive ban on vapes and cigarettes – a bill proposed by the Liberal Democratic Party as early as 2017. But he believes that the purpose of banning flavorings before making a decision is to reduce the attractiveness of nicotine consumption.
Young people are mostly attracted to the flavors of candy, chewing gum, coffee, menthol, and cherries. If we remove these aromatic baits, most people will shy away from the fun of fashion innovation, “said the deputy minister. Any potential, direct taxes or other national revenue from vape sales cannot compare to the long-term strategic task of saving the Russian people, especially the younger generation. Russian boys and girls can be cool without vapes.
He stated that if the spice ban bill is passed, the Liberal Democratic Party will do its utmost to ensure its compliance. In addition, the party also plans to enact a bill on fines for violating new regulations.

You can buy, but it’s best to close (vape store)

The Internet is full of advertisements for selling vapes. These stores have a fixed customer base, direct delivery, equipment provision, and even customized online advertisements.
As Yaroslav Nilov said, the attractiveness of such businesses is obvious; Just establish a legal entity and choose a location with convenient transportation to start. For entrepreneurs, their advantages lie in low rent, long product shelf life, and high profit margins. The average retail price of vapes is 14000 rubles (about $18), while the wholesale price for purchasing 100 cigarettes is less than 800 rubles (about $10).
It is worth noting that dozens of countries have banned the sale of vapes. In China (the main supplier of Russian vapes), the sale of such products in the domestic market is strictly restricted.
However, there are also some successful precedents for Russia to close vape stores. For example, the Vologda state government closed 32 retail stores selling nicotine containing products in just two weeks in June. Governor Georgi Filiponov stated that this accounts for 10% of the total number of vape stores in the state. According to him, prior to this, there were a total of 316 vape retail stores in the area, some of which were located near educational institutions.