Month: February 2021

Polish digital ad tax will paralyse consumer choice

Earlier this month, Polish government unveiled its plans to tax digital advertising.

It is argued that the so-called ‘solidarity levy’ is needed to help mitigate the coronavirus economic damage by raising funds for healthcare, culture, and heritage. However, along with bringing a severe economic disruption in the form of additional tax burden, the ‘solidarity levy’ will also be a final nail on the coffin of freedom of press and consumer choice in Poland.

After expected implementation in July 2021, media service providers and publishers (advertising through television, radio, cinema, and outdoor advertising media) whose advertising revenue on the territory of Poland exceeds PLN 1 million will be ​obliged to pay the new tax. Levy rates differ depending on the good advertised and the type of advertising, which has an explicit element of discrimination to it. Media (except the press) will pay from 2 per cent to 10 per cent. For online advertising the contribution will be 5 per cent, and that is to include digital giants. Sweetened beverages ads will be taxed at a higher rate which signals the Polish government’s drift towards more paternalism.

Through the introduction of a new contribution, the Polish government wants to kill two birds with one shot: punish independent media for its reliability and big tech for its digital ads success. At the core of this new policy, is the desire to level up the state’s role in shaping public opinion and increase its role in the digital market.

Unlike state-funded TVP channel that will be compensated through subsidies, private publishers and broadcasters such as TVN will be critically hit by the solidarity levy. According to a 2019 survey by ​Institute for Social Research and Market (IBRiS), the trustworthiness of TVP Info, is negatively ​assessed by 43 per cent of respondents, while 56 percent endorse TVN’s main news program “Fakty”. Hence it doesn’t come as a surprise that the Polish government wants to tax diversity of opinions out of the media space despite there being a great demand for it.

During protests against the tax on February 10th, Polish independent media suspended their coverage giving Polish consumers a horrendous glimpse into life without freedom of press. A well-functioning democracy cannot block opinions that divert from the government line using taxes as a means to achieve its ends. In the last year, Poland has dropped in the World Press Freedom Index, and now it ​ranks as the 62nd freest country in the world. The coronavirus pandemic has been detrimental to the freedom of press in Poland, and the proposed tax will depress it further by pushing independent newspapers, publishers, and broadcasters into extinction.

Consumer choice is pivotal, and depriving consumers of the possibility to choose between different media sources would be a step backwards for Poland, a country whose memory of Soviet totalitarianism is very much alive.

The economic reasoning behind the solidarity levy is weak: the redistribution of funds from private media to healthcare, culture and heritage sector will be more expensive than it might seem. Hundreds of thousands of Poles are employed in the content production field both on a national and local level, and as a result of the tax, they will lose their jobs. The Polish government will then need to take responsibility for this distortion.

More than ​40 statewide and local publishers sent an ​open letter to the Polish authorities arguing against the tax. ​The situation where the state media receive PLN 2 billion annually at the expense of Polish taxpayers, and the private companies are to be charged with an additional PLN 1 billion, they argue, is deeply unfair. Such actions on the side of the Polish government threaten competition in the media market by giving an unfair advantage to the state-funded ones. It should only be up to consumers to decide who takes lead in the market, and who loses.

The solidarity levy on digital advertising pursued by the Polish government is not economically sound and threatens the freedom of press not just in Poland, but in Europe overall. Thirty years ago the Iron Curtain fell sending a promise of freedom and prosperity in Europe, and we need to preserve it. Digital ad taxes is the idea that should have never come to life.

Originally published here.

Cryptocurrency regulations are the wrong way to go

An overly conservative regulatory approach is a danger to the innovative potential of blockchain technology…

Recently, the prices of cryptocurrencies like Bitcoin made new headlines: After reaching a staggering all-time-high, major companies like Tesla have joined the hype, pushing the price ever higher into the sky.

The European Union is in the process of implementing another AMLD, anti-money laundering directive, which puts a larger regulatory burden on crypto-currency providers. The legal and regulatory for the blockchain that the EU is aspiring to could do the same.

In recent months, a plethora of news stories tinted cryptocurrencies in a negative light – from Facebook banning ads for cryptocurrencies and ICOs to China restricting access to foreign crypto exchanges for its citizens and lastly, banks banning cryptocurrency purchases on their credit cards.

It is not news that volatility in the crypto markets exceeds that of traditional stock exchanges by a couple of magnitudes. From late 2013 to early 2015, cryptos underwent a draining bear market that came to an end with exponential price explosions in the following bull market.

Shortly following any crash of cryptocurrencies, some people feel validated to voice their prediction of the end of Bitcoin and cryptocurrencies and call for harsher crackdowns of the technology as a whole. In some, this volatility awakens a deeply-entrenched skepticism of a new technology that’s still in its infancy.

But this overly conservative regulatory approach is a danger to the innovative potential of blockchain technology. Instead of focusing on the volatile nature of the crypto market and equating it with manipulation or dismissing it as a sheer gamble, crypto skeptics should learn more about the transformative nature of the technology behind many cryptocurrencies.

Despite their popular label in the media, many of them are not, in fact, primarily currencies.

The use cases of distributed ledger technology span from delivering aid efficiently to refugees, using blockchain to build a digital identity, enabling scientists to use your safely stored genomic data and a myriad of other fields of application.

Many crypto skeptics refuse to inform themselves on the multitude of use cases of blockchain technology across several industries. Solely focusing on the volatile price does not leave enough room to ponder upon the many ways this newly emergent technology might change our lives in the near future.

During the recent Senate hearing on cryptocurrency regulations, the chairman of the United States Commodity Futures Trading Commission (CFTC) J. Christopher Giancarlo had some encouraging words for the primarily younger generation interested in blockchain technology.

Talking about his niece’s interest in Bitcoin, Giancarlo stressed that any future regulations should not be dismissive, but rather respectful of the younger generation’s fascination with blockchain technology:

“It strikes me that we owe it to this generation to respect their enthusiasm about virtual currencies with a thoughtful and balanced response, not a dismissive one,” said Giancarlo.

Elaborating further, Giancarlo stressed that regulators should have a positive outlook on the future of this technology. While doing so, he seemed quite knowledgeable, even going as far as explaining the meaning of crypto-related terms like ‘HODL’ and ‘kimchi premium’.

For Giancarlo, regulating cryptocurrencies should have the aim of cracking down on fraudsters and fight market manipulation, not to stifle the flourishment of a new technology whose many advantages he acknowledged.

In this way, consumers should be given the opportunity to educate themselves on the different use cases of blockchain technology and have the liberty to invest in projects they deem promising.

Instead of stifling innovation and consumer choice, such a regulatory framework that provides enough space for creative exploration would ensure that future advancements in the cryptosphere are acknowledged as such and gradually find themselves changing traditional banks, corporations, and government operations.

Originally published here.

Article calls for EU to rethink stance on e-cigarettes

recent article for The Parliament Magazine entitled ‘Vaping is the gateway out of smoking’ is calling for policymakers to reconsider their stance on e-cigarettes, as they should be endorsing them as a stop smoking aid in the interest of a smoke-free future.

Why vaping is not a gateway into smoking

E-cigarettes, which have been widely available and popular as a smoking cessation tool since 2013, are seen as a novel technology, and this means they have been met with some suspicion by the EU. The article explains that recent criticism has “sought to frame vaping as a gateway to conventional smoking”.

This has long been proven untrue, and a recent survey by ASH (Action on Smoking and Health) actually reported that only 0.3% of never-smokers are currently e-cigarettes users, which accounts for 2.9% of vapers. Not only is the gateway effect not reflected in data, but numerous studies have concluded the opposite is true, and vaping is a gateway out of smoking.

How can e-cigarettes help smokers quit?

E-cigarettes are targeted at harm reduction, by giving users an alternative nicotine source that does not include all of the other harmful toxins that are found in traditional cigarettes.

The article, co-authored by Consumer Choice Center’s Maria Chaplia and World Vapers’ Alliance’s Director Michael Landl, states;

“The correlation between the introduction and the popularity of vaping and declining smoking rates suggests that vaping is an important innovation to help people quit smoking.”

One of the most important reports on vaping’s potential to save lives is from 2015, commissioned by Public Health England. This report found that e-cigarettes are 95% less harmful that smoking, and the findings in this report have been a big supporting factor in the way in which the UK has embraced e-cigarettes as an invaluable smoking cessation tool.

The article suggests that if the EU continues to demonise vaping, it will negatively affect the chance of smokers making the switch to a ‘safer and healthier alternative’ and suggest that at this point we now know enough about vaping that there is no reason for the EU not to endorse it.

It is clear to see that countries that adopt harm reduction policies, such as endorsing the use of e-cigarettes, see a greater reduction in smoking rates than those who do not. A great example of this is the UK, where health authorities encourage the use of e-cigarettes as a stop smoking aid, and smoking rates are now at an all-time-low. On the other hand in Australia, where vaping has not been well received, rates of smoking have declined at a much slower rate;

“In the UK, approximately 25 percent fewer people smoke today compared to 2013, while the US has seen a 24 percent reduction. For the same period, Australia saw a decline of only 8 percent.”

There is a visible correlation between when e-cigarettes became widely available and popular as a stop smoking aid, and the reduction in smoking rates among the UK adult population.

‘Recent trends framing e-cigarettes as a gateway to smoking do not stand up to scrutiny. E-cigarettes are a gateway out of smoking. Anti-vaping measures are disastrous and detrimental to the health of smokers for whom vaping has become a life-saving tool.’

The article concludes by strongly encouraging policymakers to reconsider their stance on vaping, in line with the overwhelming amount of data that proves it to be an undeniably effective tool to help smokers pursue a healthier lifestyle and reduce their risks of future illness and disease. Ending with the strong and decisive statement;

‘Despite many voices seeking to undermine vaping as a gateway out of smoking, the evidence is sound: vaping saves lives.’

So with mounting calls to re-evaluate their approach to vaping, we can only hope that the EU will help prioritise the health of the public, and encourage adult smokers to pursue a safer alternative to smoking.

Originally published here.

La vape face au tabagisme, une solution que l’UE ne peut plus ignorer?

Ce n’est malheureusement pas nous qu’il faudra convaincre mais bien les institutions de l’Union Européenne. Si la question reste épineuse pour les politiques, un récent article de  » The Parliament Magazine  » a lancé un appel aux décideurs politiques afin qu’ils reconsidèrent leurs positions sur la vape. Et en effet, il serait grand temps d’approuver l’e-cigarette comme une aide dans l’arrêt du tabagisme!

Un monde sans fumée ? C’est un slogan d’avenir que l’on entend de plus en plus dans les pays de l’Union Européenne mais qui n’est malheureusement pas suivi par une politique ambitieuse. Se permettre d’ignorer la vape en 2021 dans la lutte contre le tabagisme revient tout simplement à condamner des milliers de fumeurs dans le monde !

L’e-cigarette largement disponible et popularisée en tant qu’outil de sevrage tabagique depuis 2013, est considérée comme une nouvelle technologie, ce qui signifie qu’elle a suscité quelques soupçons de la part de l’Union Européenne. L’article publié par « The Parliament Magazine » explique que les récentes critiques ont « cherché à présenter le vapotage comme une passerelle vers le tabagisme conventionnel ».

L’article, co-écrit par Maria Chaplia du Consumer Choice Center et Michael Landl, directeur de la World Vapers ’Alliance, déclare :  » La corrélation entre l’introduction, la popularité du vapotage et la baisse des taux de tabagisme suggère que le vapotage est une innovation importante pour aider les gens à arrêter de fumer.  »

Il suggère également que si l’Union Européenne continue de diaboliser le vapotage, cela affectera négativement les chances des fumeurs de passer à une  » alternative plus sûre et plus saine  » et suggère qu’à ce stade, nous en savons maintenant suffisamment sur le vapotage et qu’il n’y a aucune raison pour Union Européenne de ne pas l’approuver.

L’article conclut en encourageant fortement les décideurs à reconsidérer leur position sur le vapotage, conformément à la quantité écrasante de données qui prouve qu’il s’agit d’un outil indéniablement efficace pour aider les fumeurs à adopter un mode de vie plus sain et à réduire leurs risques de maladies et de maladies futures.

Originally published here.

Dampak Perlindungan Hak Kekayaan Intelektual Terhadap Kesejahteraan

Peningkatan kesejahteraan bisa dikatakan merupakan salah satu hal yang sangat penting untuk dicapai oleh berbagai pemerintahan di seluruh dunia. Meningkatnya kesejahteraan di sebuah negara, merupakan salah satu tolak ukur yang paling umum dan mutlak untuk menentukan apakah sebuah pemerintahan berhasil dalam mengelola negara yang dipimpinnya.

Selain itu, peningkatan kesejahteraan juga merupakan salah satu fondasi yang sangat penting bagi stabilitas politik. Tanpa adanya peningkatan kesejahteraan, terlebih lagi bila standar hidup masyarakat di sebuah negara terus menurun dari tahun ke tahun, tidak mustahil hal tersebut justru akan membawa pada pergolakan sosial, yang berujung pada instabilitas politik yang sangat berbahaya bagi keamanan dan kegiatan ekonomi.

Untuk itu, adanya kebijakan publik yang dapat mendukung upaya peningkatan kesejahteraan merupakan hal yang wajib menjadi fokus dan diberlakukan oleh berbagai pemerintahan dan para pengambil kebijakan di seluruh dunia. Bila suatu pemerintahan atau pengambil kebijakan membuat produk hukum yang tidak dapat menunjang peningkatan kesejahteraan, tentu upaya meningkatkan kesejahteraan tersebut akan mustahil dapat tercapai, dan bukan tidak mungkin justru akan membawa kemunduran serta peningkatan kemiskinan di negara tersebut.

Terkait dengan hal tersebut, sejarah sudah membuktikan bahwa, kebebasan ekonomi merupakan fondasi yang sangat penting untuk meningkatkan kesejahteraan di sebuah negara. Pasar bebas merupakan pilar yang sangat penting untuk mengeluarkan seluruh potensi dan kreativitas yang dimiliki oleh masyarakat di sebuah negara, yang akan mendorong inovasi dan meningkatkan kegiatan ekonomi yang akan membawa manfaat bagi penduduk di negara tersebut.

Salah satu lembaga think tank yang memiliki fokus pada aspek kebebasan ekonomi adalah lembaha think tank asal Amerika Serikat, The Heritage Foundation. Setiap tahunnya, lembaga think tank tersebut merilis laporan mereka mengenai indeks kebebasan ekonomi negara-negara di dunia, yang dikenal dengan nama Index of Economic Freedom. Indeks tersebut mengukur kebebasan ekonomi berbagai negara di dunia, dan membuat peringkat berdasarkan indikator-indikator yang mereka gunakan.
Setelah itu, negara-negara tersebut dibagi menjadi lima kategori, yakni free, mostly free, moderately free, mostly unfree, dan repressed. Negara-negara yang menduduki peringkat free diduduki negara-negara yang di mana memiliki kerangka hukum yang mendukung kegiatan ekonomi secara bebas, serta institusi yang transparan dan bebas dari korupsi. Sebaliknya, negara-negara yang membatasi kegiatan ekonomi masyarakatnya secara ketat, serta memiliki institusi yang tertutup dan korup, maka mereka menduduki peringkat yang rendah.

Setelah peringkat tersebut disusun, terbukti bahwa, secara rata-rata, negara-negara yang menduduki peringkat free memiliki pendapatan per kapita yang sangat tinggi. Sebaliknya, negara-negara yang menduduki peringkat bawah dalam indeks tersebut, atau masuk dalam kategori repressed, cenderung memiliki Produk Domestik Bruto (PDB) per kapita yang rendah. Pada tahun 2019 misalnya, rata-rata negara-negara yang masuk dalam kategori free memiliki PDB per kapita sebesar USD63.588, sementara negara-negara yang menduduki peringkat terbawah rata-rata PBD per kapitanya hanya USD7.716 (The Heritage Foundation, 2020).

Hasil dari penelitian ini tentu merupakan sesuatu yang sangat penting untuk diperhatikan oleh berbagai pembuat kebijakan di seluruh dunia. Kebebasan ekonomi merupakan pilar yang sangat penting sebagai dasar peningkatan kesejahteraan di sebuah negara.

The Heritage Foundation sendiri menggunakan beberapa indikator untuk mengukur tingkat kebebasan ekonomi di sebuah negara dalam indeks mereka. Salah satu dari indikator tersebut yang sangat penting adalah perlindungan terhadap kepemilikan pribadi (private property rights).

Adanya kerangka hukum dan sistem kelembagaan yang melindungi kepemilikan seseorang merupakan hal yang sangat krusial untuk menunjang kebebasan ekonomi. Tanpa adanya perlindungan terhadap hak kepemilikan, tentu aktivitas ekonomi tidak dapat berjalan dengan lancar, karena setiap orang dapat merampas hak milik orang lain dengan mudah.

Perlindungan hak kepemilikan pribadi ini bukan hanya mencakup dengan aset-aset yang nyata, atau yang dikenal juga dengan tangible asset, namun juga harus mencakup hak kekayaan intelektual. Perlindungan hak kekayaan intelektual merupakan hal yang sangat penting untuk melindungi para inovator dan orang-orang yang kreatif agar mereka bisa mendapatkan manfaat ekonomi dari karya yang mereka buat dengan bersusah payah dan kerja keras.

Sebagaimana dengan perlindungan hak kepemilikan pribadi terhadap aset-aset yang tangible, tanpa adanya perlindungan terhadap hak kekayaan intelektual, maka kebebasan ekonomi akan sulit untuk dicapai. Tanpa adanya perlindungan terhadap hak kekayaan intelektual, maka setiap orang dapat dengan mudah membajak dan mencuri hasil karya orang lain untuk keuntungan diri mereka sendiri, tanpa harus menaruh usaha dan bekerja keras untuk membuat dan menciptakan karya tersebut.

Hubungan antara perlindungan hak kekayaan intelektual yang kuat dengan kesejahteraan merupakan hal yang diteliti oleh beberapa pihak. Pada tahun 2017 misalnya, sektor-sektor yang bertumpu pada hak kekayaan intelektual telah berkontribusi pada lebih dari 30% dari tenaga kerja di negara-negara maju seperti Amerika Serikat dari Eropa, dan telah berkontribusi terhadap 40% PDB dari Amerika Serikat dan negara-negara di Uni Eropa (Forbes.com, 26/4/2017).

Perlindungan yang lemah terhadap hak kekayaan inteletual juga telah membawa kerugian dan malapetaka di negara-negara yang berpenghasilan rendah dan menengah. Direkrut eksekutif dari organisasi pegiat hak kekayaan intelektual, Property Rights Alliance, Lorenzo Montanari, mencatat bahwa perlindungan hak kekayaan intelektual yang buruk di negara-negara berpenghasilan rendah dan menengah telah merugikan banyak pelaku ekonomi lokal (Forbes.com, 26/4/2017).

Montanari mencatat hal yang terjadi di Nigeria misalnya, merupakan salah satu contoh dari hal tersebut. Nigeria merupakan salah satu negara yang memilki industri perfilman yang sangat maju, yang dikenal dengan julukan Nollywood. Industri perfilman di Nigeria juga telah melahirkan banyak aktor-aktor ternama yang memiliki basis penggemar dari seluruh dunia.

Namun, karena negara tersebut tidak memiliki perlindungan terhadap hak kekayaan intelektual yang kuat, maka para produser dan pembuat film di Nigeria tidak bisa mendapatkan investasi yang besar untuk menunjang industri perfilman mereka, karena banyaknya pembajakan. Hal ini tentu merupakan hal yang sangat merugikan bagi industri perfilman di Nigeria, dan besar kemungkinan hal tersebut akan menghambat perkembangan industri perfilman di negara tersebut.

Sebagai penutup, perlindungan hak kepemilikan pribadi, termasuk juga hak kekayaan intelektual, merupakan salah satu pilar penting kebebasan ekonomi, yang merupakan fondasi untuk meningkatkan kesejahteraan. Untuk itu, bila sebuah negara ingin meningkatkan kesejahteraan masyarakatnya, memperkuat perlindungan hak kekayaan intelektual, sebagai bagian dari perlindungan hak kepemilikan pribadi, merupakan hal yang sangat penting untuk menjadi perhatian bagi para pembuat kebijakan di sebuah negara.

Originally published here.

La valeur des publicités

Par Bill Wirtz

Avez-vous déjà acheté quelque chose à cause de l’image d’une marque ? Certainement, surtout lorsque l’emballage est très voyant et séduisant. Si nous devions nier que nous répondons à de bonnes publicités, nous pourrions tout aussi bien condamner des millions de départements marketing à l’obscurité, car quelle valeur a le marketing dans un monde d’engourdis.

Nous répondons aux marques comme un facteur qui guide nos décisions d’achat, mais pour fidéliser la clientèle, il faut plus qu’un bon emballage. Les consommateurs modernes regardent au-delà même de la qualité d’un produit : ils s’intéressent aux méthodes de production, au traitement éthique des travailleurs et aux chaînes d’approvisionnement durables. Ce que nous avons parfois tendance à appeler cyniquement le “greenwashing” est un véritable phénomène de consommateurs exerçant une pression sur les entreprises pour qu’elles changent leurs politiques.

À quoi servirait cette pression si nous devions nous débarrasser complètement du marketing ou de la notoriété de la marque ? La raison pour laquelle je fais pression sur mon producteur d’ordinateurs portables préféré pour qu’il évite à tout prix l’esclavage est que je peux consciemment rester fidèle… non pas aux ordinateurs portables eux-mêmes, mais à cette marque en particulier. Si ce producteur de logiciels s’engage également à respecter des normes strictes en matière de protection de la vie privée, alors je suis même heureux d’être un ambassadeur non rémunéré de la marque pour cette entreprise, grâce au bouche-à-oreille. 

Certains défenseurs de la santé publique ont affirmé que la stratégie de marque et le marketing consistent essentiellement à tromper les consommateurs en leur faisant acheter des choses qui sont malsaines pour eux ou en les guidant vers des achats qu’ils ne veulent pas vraiment faire. Les termes “marketing” et “lavage de cerveau” apparaissent parfois comme des synonymes, surtout lorsqu’il s’agit d’enfants. Certains produits font l’objet d’une interdiction flagrante de la publicité dans certains États membres de l’UE parce qu’ils font de la publicité pour les enfants, ou plutôt pour les parents qui font l’achat plus tard. Ces interdictions suggèrent de supprimer la responsabilité des parents.

Si le choix est entre l’éducation des enfants sur les conséquences de leur comportement et une interdiction flagrante de la publicité pour les produits, la plupart des gens préféreraient éduquer les enfants. Les enfants ne peuvent apprendre à devenir des consommateurs responsables plus tard que s’ils sont éduqués, au lieu de se faire réprimander. L’approche restrictive et punitive est celle que nous appliquions aux enfants et aux jeunes adultes jusqu’à la révolution culturelle de 1968, et elle n’a donné aucun résultat positif. Oui, les diffuseurs doivent être conscients que l’affichage de publicités pour l’alcool pendant les émissions pour enfants est (au-delà du fait qu’il n’est pas économique pour la société de publicité) irresponsable. Cela ne signifie pas pour autant qu’il faille dissimuler l’existence de l’alcool aux enfants. Oui, l’alcool existe, et sa consommation à l’âge approprié et en quantités appropriées peut être sûre.  

Nous devons traiter les enfants comme des enfants, mais nous ne devons pas oublier qu’ils sont en train de grandir et qu’ils sont capables de comprendre les nuances en grandissant. Une protection excessive est non seulement improductive, mais elle est aussi condescendante pour les consommateurs adultes. Sous le couvert de la croyance mal informée que tout marketing est malveillant et sous l’affirmation précise mais hors contexte que toutes les publicités PEUVENT être vues par les enfants, certains plaident pour une interdiction complète. Ce n’est pas la bonne façon de procéder. De nombreuses plateformes vidéo et services de streaming offrent déjà des options de contrôle parental, qui aident à réguler les choses que les enfants voient. Les principaux navigateurs internet font de même.

Les restrictions de commercialisation ne sont pas seulement un coup porté à l’information des consommateurs du point de vue de la disponibilité des produits, c’est aussi un message clair aux parents qui leur dit “nous ne vous faisons pas confiance pour faire les bons choix pour vos propres enfants”. Les publicités sont essentielles à la liberté des marques. Les marques sont importantes pour les consommateurs, non seulement parce qu’elles établissent la fidélité des consommateurs, mais aussi parce qu’elles aident à distinguer les produits sur le marché. Dans les situations où les entreprises donnent des informations inexactes sur leurs produits, les concurrents devraient pouvoir commercialiser des produits plus sûrs et plus sains. C’est l’essence même du choix du consommateur.

No more future booze bans, please!

Research shows that the lockdowns spurred growth in the black market in alcohol.

What happens when something people really want is banned? Do they stop wanting it? Or do they find other ways to access it? Our experience with the lockdown alcohol ban answers this question and must give policymakers pause when considering their future plans.

According to the Transnational Alliance to Combat Illicit Trade (Tracit), liquor bans have spurred the growth of the black market in alcohol. Research from the Institute for Security Studies supports this conclusion, as does statements from the South African Revenue Service.

And it simply stands to reason: People are not robots and do not suddenly stop craving and desiring certain products just because some politicians said it must be so. Readers of this article likely know very well from personal experience that, on the ground, the booze did not stop flowing. For the formal, lawful alcohol industry, however, South Africa’s alcohol bans have been disastrous.

The justification for the bans was quite intuitive: Expecting a rise in Covid-19 patients to arrive at South African hospitals, government wanted to reduce the number of patients suffering from an alcohol-related condition taking upward space. The healthcare sector needed time, so went the reasoning, to expand its capacity.

The first alcohol ban was imposed between March 27, and June 1, 2020, the second from July 12 to August 17, and the most recent was from 28 December 2020 to 1 February 2021, when it was mostly lifted.

On Monday, 24 August 2020, health minister Zweli Mkhize announced that they “have no started to dismantle some of the field hospitals [because additional] beds are no longer necessary”. This was mere days after the lockdown was downgraded from level 3 to level 2. Cooperative governance minister Nkosazana Dlamini-Zuma cautioned South Africans against the very real possibility of a second wave in the near future as restrictions on their liberties were being taken away.

In December, when he was announcing the renewed alcohol ban, President Cyril Ramaphosa noted how hospitals were being overwhelmed with alcohol-related trauma cases.

Government did expand hospital capacity then dismantled it, knowing well that a second wave was likely on the horizon. It is the stuff of spiteful, arbitrary governance, then, to punish a massive sector of the economy, not to mention the South African public, for government’s own short-sighted planning.

While the lockdown alcohol ban might at the time of writing have been lifted, Dlamini-Zuma has made it clear that banning liquor again was not out of the question. The alcohol industry is therefore now caught in a position of impossible uncertainty.

Minister Dlamini-Zuma says the ban’s intention is not to cause harm to the industry, but such an assurance is cold comfort in light of the facts.

The alcohol industry by 2019 had supported the livelihoods of a million South Africans and contributed more than 3% of GDP, not to mention the more than R15 billion in tax revenue it brought in for government. Indeed, the money the alcohol industry lost due to the lockdown booze ban would have gone a long way to financing South Africa’s vaccine drive.

Tracit found that there was a 900% increase in pineapple sales after the alcohol ban came into effect. The obvious reason for this is that many people started homebrewing pineapple beer, and presumably selling it on the black market.

Even supermarkets, seizing the opportunity, “started selling the fruit as a package with sugar and yeast”. During the ban, the police also reported the smuggling of alcohol contraband from neighbouring states, and losses to the lawful industry in the illicit trade, according to Tracit, were expected to rise to about R13 billion per year.

While the illicit trade is entirely understandable, given the ill-considered policy decisions made by the government, consumers should nonetheless beware of the health risks of purchasing homebrewed booze. Whereas the lawful alcohol industry is subject to strict quality standards, someone selling beer they had just made in their garage is not. Dozens of reported deaths have already resulted from such dangerous consumption.

Some who do not partake in the consumption of alcohol (myself being among them), have admitted the damage this ban has done economically, but do not sympathise with the alcohol industry, who they credit with the exploitation of South Africa’s poor population.

This perspective, unfortunately, misses the point that the “alcohol industry” is not all directly concerned with alcohol. Glass bottling firms, retailers, transportation companies, restaurants, and a multitude of other enterprises are part of this industry and many, in indirect ways, are dependent upon it. Must the staff, and their families, of bottling companies and restaurants also suffer, simply to show up the beverage makers?

Consumer freedom of choice is guaranteed by the Constitution, and means other people – the poor included – may decide to do things that the chattering classes disagree with. This includes consuming alcohol. The marketplace is all about suppliers meeting demand and creating value for their consumers, and this is exactly what those in the alcohol trade are doing. It is not only economically devastating for government, supported by a small elite of intellectuals who disapprove of alcohol consumption, to interfere in this freedom, but it is also profoundly condescending and immoral.

Tracit rightly recommends that bans and prohibition should not be regarded as a legitimate means of responding to Covid-19, for such a response lacks discernible benefits and the consequences are dire for the alcohol industry, the economy, the government, and the entire South African society. It is far safer for South Africans, whose demand for alcohol is not going anywhere, to be able to access it in the lawful market, where it is subject to quality standards and where the point of sale is subject to social distancing and hygienic regulations.

No economy can function efficiently in the presence of the kind of policy uncertainty presently reigning in South Africa. Government must reassure the alcohol industry that further bans are off the table. Otherwise, we should expect further disinvestment by the industry and the further growth of the illicit trade, even now while the ban has been suspended.

While certain common-sense measures to combat Covid-19 can be retained, it is high time for South Africa to return to a healthy respect for freedom of choice.

Martin van Staden is South African Policy Fellow with the Consumer Choice Centre

Originally published here.

What does the UK Supreme Court ruling on Uber mean for the gig economy? Business and legal experts react

Uber has seen the UK’s highest court rule that its drivers are workers in an “historic” case.

The Supreme Court ruled in favour of 35 Uber drivers in a case first brought in 2016. The drivers, who were deemed self-employed by the US-based ride-hailing app, argued that they should instead be classed as workers.

Under UK law, a person classed as a worker is entitled to some rights traditionally enjoyed by employees, including holiday pay and the minimum wage.

The ruling is one of the most significant employment cases the UK has seen.  It is a serious blow to Uber in what is one of its biggest consumer markets, and it is not yet known how big an impact it will have on the UK’s wider gig economy going forward. 

Several other taxi apps, including Bolt, Kapten and Ola, also currently operate on a similar model to Uber around the UK, and the wider gig economy has grown significantly over the past decade across the retail and consumer sectors. 

Self-employment accounts for more than one-third (35%) of employment growth since 2008, according to the Resolution Foundation. 

A lead claimant in the case, James Farrar, said that he hopes the ruling will “fundamentally re-order” the way businesses in the gig economy operate. 

Here we bring you reactions to the ruling and comments on its significance from political, legal, business and HR experts: 

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, noted that Uber’s share price fell 1% in opening trading on Wall Street “as investors digested the implications of the UK ruling”.

She said that a “significant rethink” of Uber’s labour policies is likely to be on the cards – and that it may even accelerate Uber’s plans to bring in self-drive cars “to eliminate the headache and cost of human labour.’’

The analyst pointed to delivery firm Hermes, which lost a similar ruling in the UK back in 2018, and ended up coming to a deal with unions which saw couriers offersed a “self- employed plus” status. 

Streeter said that the Supreme Court’s decision is the latest blow “chipping away at the gig economy model upon which the transport and delivery companies have developed sprawling and lucrative businesses”.

“Uber faces challenges in other parts of the world to drivers’ self-employed status, so a significant rethink of its labour policies is likely to be on the cards,” she said. “The UK Supreme Court decision steers Uber into a dead end in its legal fight and now the ride-hailing service will have to incur significant additional costs in the UK, to pay drivers the minimum wage and overtime and potentially also compensation.”

The Mayor of London, Sadiq Khan, welcomed the ruling and said he “wants London to be the best place to do business and also the best place to work”.

He said: “Gig economy workers deserve the same rights as other workers.

“I urge businesses in the capital, including private hire companies, to pay their workers the London Living Wage, and to give them the security they deserve.

“Treating workers well leads to increased productivity.

“London is a tech powerhouse for the world – but employers must play by the rules.”

Alexandra Mizzi, Legal Director at law firm Howard Kennedy, said the result “underlines the key lesson for gig economy businesses: calling someone self-employed doesn’t mask the legal reality”.

Mizzi said: “This result will mean that the estimated 45,000 Uber drivers in the UK will benefit from a host of legal protections, including sick pay, holiday pay and whistleblower protections going forward.”

The lawyer noted that Uber will also face “a huge liability for unpaid national minimum wage, enforced by HMRC, as the Court also found that drivers were working when logged into the app”. 

Andy Davies, Senior VP at global HR company,MHR , said that the ruling shows “the tide is turning” on gig economy employers.

He said: “The tide is turning on those employers who unscrupulously use gig workers as a source of cheap labour and should serve as a stark reminder to other businesses that unless staff fit squarely into the ‘employee’ bracket, then they need to carefully consider their employment status, or consider themselves severely out of pocket in the future.”

The ruling that drivers are workers could even see workers across the entire gig economy rights to pension contributions, Aegon expert Kate Smith said.

Smith, who is the financial service firm’s head of pensions, said the ruling “could have ripple effects for all gig workers, giving them not only rights to holiday pay, but potentially other workplace  benefits such as employer pension contributions”. 

She said:“This reclassification is another step towards opening the doors to auto-enrolment for all gig workers, giving them the opportunity to save for retirement, with the important boost of the right to a 3% employer pension contribution.“  

Rosie Hooper, chartered financial planner at wealth manager Quilter, added: “There needs to be concerted effort to continue to boost engagement in pensions and ensure that those being enrolled for the first time know what they are contributing to and where it is going.”

Consumer rights groups warned that the decision may push up prices, and deter ride-hailing companies from investing in the UK.

Yaël Ossowski, deputy director of the global consumer advocacy group Consumer Choice Center, said that the “ruling sends the signal that rideshare companies are not welcome in the UK”and that  this is “not what consumers want”.

She said: “The flexible model that has so far propelled the growth of companies like Uber, Lyft, and others has been beneficial for both drivers who want independence and consumers who want convenience and competitive prices.”

Uber said it “respects the court’s decision”

Jamie Heywood, Uber’s Regional General Manager for Northern and Eastern Europe, said: ”We respect the Court’s decision which focussed on a small number of drivers who used the Uber app in 2016.

“Since then we have made some significant changes to our business, guided by drivers every step of the way. These include giving even more control over how they earn and providing new protections like free insurance in case of sickness or injury.

“We are committed to doing more and will now consult with every active driver across the UK to understand the changes they want to see.”

Uber noted that being a worker “is a legal classification that’s specific to the UK” and that the ruling did not find the claimants to be employees” – and that the judgement “does not relate to couriers who earn on Uber Eats”.

Originally published here.

The inconsistencies of the European precautionary principle

Genetic engineering continues not to be allowed in the EU, but random mutagenesis is.

Despite revolutionising agriculture, genetic engineering is not allowed in the European Union. I have laid out the problem with this EU legislation in other blog posts on this website. In this article, I want to explain the blatant inconsistency of allowing random mutagenesis when genetic engineering remains illegal.

Conventional plant-breeding technologies include random mutagenesis. In the 20th century, plant-breeders significantly increased the number of naturally occurring mutations by inducing it through chemicals and radiation, achieving changes in the genome that aren’t directed or which outcome is not certain.

Robert Hollingworth, professor emeritus of the Michigan State University (MSU) Department of Entomology and Institute for Integrative Toxicology has described the process as follows:

“More crops than you would imagine, in the supermarket today, were actually bred by mutagenesis. That is either treating the seeds with mutation-causing chemicals or blasting them with radiation. Ruby Red Grapefruit is an example and some of the barley strains that are used, even to produce organic beer, were produced in this way. It is quite common.

With mutagenesis, often the majority of things that happened were bad and so they would get thrown away, but once in a while something that was positive, like having no seeds or being shorter and therefore easier to harvest resulted and those were eventually released on the market, and without anybody asking a question.”

In essence, GMOs, and in an even more direct way, gene-editing, are precise methods, while existing mutagenesis is imprecise. A coherent application of precautionary food safety policy would prioritise genetic engineering over random mutagenesis.

A list of thousands of mutant varieties created through radiation is available on the website of the International Atomic Energy Agency, making publicly accessible information. However, despite being publicly available, it most certainly isn’t public knowledge, comparable to the way many consumers believe that organic food production does not involve pesticides. If food products were to be labelled with a “product created through radiation”, could we expect a reasoned conversation about the pros and cons of this method, or rather a complete rejection of these products from the start? The answer is intuitive. This is not an attempt to discredit random mutagenesis as a plant-breeding technology, nor make a wider claim about mandatory labelling, yet it does open this question: having considerably more certainty over the effects produced by genetic engineering than for those effects created by random mutagenesis, why are mandatory GMO labels a more attractive political option?

Furthermore, the inconsistencies of public discourse have made their way into legislation at the European Union level. The directive on the use of GMOs (addressed in the next chapter) excludes random mutagenesis, as the European Court of Justice has confirmed: “The Court states, however, that it is apparent from the GMO Directive that it does not apply to organisms obtained by means of certain mutagenesis techniques, namely those which have conventionally been used in a number of applications and have a long safety record.”

This is inconsistent with the scientific understanding of these procedures. In fact, human-induced transgenesis has a long safety record, while the results of random mutagenesis are, as previously explained, volatile.

The European Union needs to review its approach to the precautionary principle. What we currently see is that innovative solutions are reprimanded, while old and more problematic one is held up, because they confirm the biases of some in the EU. 

Originally published here.

Податок на інтернет гігантів будемо платити ми

Замість того, щоб довести до пуття наболілі економічні та судову реформи, маємо новий податок.

17-го лютого в середу Верховна Рада прийняла за основу законопроект про так званий податок на Гугл, який зобов’яже “big tech” (інтернет-гігантів) сплачувати податок на додану вартість до українського бюджету. Необхідність законодавчого акту, як пояснюють парламентарі-ініціатори, полягає в тому, що несплата компаніями-нерезидентами ПДВ призводить до втрат державного бюджету та створює неконкурентне середовище для резидентів-платників.

Дякуючи пандемії та локдаунам, що стали її наслідком, світ більшою мірою перейшов онлайн. Останній рік став переломним моментом для цифрової економіки. Вона рятувала нас від самотності під час квітневого і лютневого локдаунів, допомогала просувати власні бізнес-ідеї через рекламу в соцмережах та заохочувала створення нових додатків девелоперами. Мова йде про реальних споживачів. І саме їм – нам з вами – доведеться платити цей ПДВ. 

Перелік послуг, які охоплює нове регулювання, є досить широким. Зокрема, до таких послуг, зокрема, але не виключно, належать:

а) постачання зображень або текстів, в тому числі фотографій, електронних книжок та журналів;
б) постачання аудіовізуальних творів, відео на замовлення, ігор, азартні ігри, включаючи постачання послуг з участі в таких іграх;
в) надання доступу до інформаційних, комерційних, освітніх та розважальних електронних ресурсів та інших подібних ресурсів;г) надання у користування хмарних технологій для розміщення даних;
ґ) постачання (передача прав на використання) програмного забезпечення та оновлень до нього, а також дистанційне обслуговування програмного забезпечення та електронного обладнання;
д) надання рекламних послуг в мережі «Інтернет», мобільних додатках та інших електронних ресурсах.

Податок на додану вартість, як відомо, є непрямим податком, який сплачується покупцем послуг, але саме адміністрування здійснюється продавцем. Таким чином, будь-які послуги, які ми зараз отримуємо через інтернет (Youtube, Netflix, Google, Apple, AliExpress) подорожчають на 20 відсотків. Аналогічне подорожчання відбудеться у сфері e-commerce, а зокрема розміщувати реклами в соціальних мережах та мобільних додатках стане дорожче. Поширення ПДВ на інтернет-гігантів матиме прямий негативний вплив на малий бізнес в Україні, якому можливості інтернету дозволили комунікувати свою пропозицію більш ефективно.

Сама ставка податку на ПДВ на електронні послуги – та й загалом – є досить високою. В одній з найбільш економічно вільних країн світу Сінгапурі вона становить 7 відсотків, в Америці – до 10, у Канаді – 6. Очевидно, що розширити спектр регулювання вже встановленої ставки ПДВ на електронні послуги для регулювання конкуренції є набагато легше, аніж зменшити ставку повністю. Конкуренція на всіх ринках процвітає там, де держава мінімально втручається. 

Але наші парламентарі чомусь вирішили, що нам треба йти дорогою Росії, на яку вони посилаються у пояснювальній записці до законопроекту.

“З 01 січня 2017 року в Російській Федерації був введений податок, який зобов’язав нерезидентів сплачувати податок на додану вартість з продажу на території РФ електронних послуг: цифрового контенту, послуг зберігання та обробки інформації, реєстрації доменів і хостингу та ін., при цьому вони повинні стати на податковий облік. Серед технологічних гігантів у контролюючому органі зареєструвались Apple Distribution International, Google Commerce, Microsoft Ireland, Netflix International B.V., Wargaming Group, Bloomberg, Alibaba, Booking.com та ін. Загалом з моменту впровадження податку на податковий облік стало 1580 компаній. За офіціними даними до бюджету такими компаніями (B2C) було сплачено у 2017 році  – 9,4 млдр. руб., у 2018 – 12 млдр. руб., у І кварталі 2019 – 12 млдр. руб. (70% суми припадає на найбільші IT компанії). Аналогічні податкові правила введені в Республіці Білорусь у 2018 році. “

Рухаємось на захід до кращого та вільного майбутнього, так? А загалом, цифри про те, скільки надходжень до державного бюджету допоміг отримати новий ПДВ не можуть бути ключовим аргументом у випадку України. Як ми всі добре знаємо, всі надходження до бюджету проходять мільйон корупційних схема перше, ніж якась мінімальна частина з них впаде на нас у вигляді послуг, соціальних гарантій і тд. Саме така доля чекає і на новий ПДВ. Нам треба зосередитись на тому, щоб лишити більше грошей на руках в звичайних громадян і дати їм можливість витрачати так, як вони вважають за потрібне.

Певно, одним з найбільш проблемних аспектів даного законопроекту є бюрократія. Компаніям-нерезидентам доведеться мати справу з нашою славнозвісною податковою і наділення її новими владними повноваженнями викликає занепокоєння. Відповідно до законопроекту, при проведенні податкової перевірки спрощеної податкової декларації поданої особою нерезидентом, може витребувати в особи нерезидента та третіх осіб інформацію та документи, які підтверджують факт постачання на митній території України електронних послуг фізичним особам, вартість поставлених послуг та терміни їх оплати. 

Загалом, головне, що нам всім варто зрозуміти стосовно розширення регулювання ПДВ це те, що платити за це прийдеться нам з вами. Для малих девелоперів та бізнесу це підсилить тягар ведення діяльності в Україні. Що з цими грошима буде робити держава – невідомо. Але замість того, щоб довести до пуття наболілі економічні та судову реформи, маємо новий податок. Податок на сервіси, які комусь дозволяють заробити, а комусь – відпочити від негативних новин про ковід за серіалом.

Originally published here.

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