Canada is repealing the excise tax on non-alcoholic beer

Non-alcoholic beer has been subject to federal excise taxes despite not containing virtually any alcohol at all. 

Our North American Affairs Manager, David Clement pointed out several problems with this tax and was invited to meet with the Ministry of Finance to explain the arguments against the tax. For example, non-alcoholic wine and spirits are exempt from the tax, which created a huge disparity for non-alcoholic beer. Removing tax would reduce costs for health-conscious consumers, who are looking for a healthier alternative to their favorite drink. This would also be consistent with the principles of harm reduction, a policy approach the current government has taken upon other issues. 

Fortunately, Budget 2022 removes alcohol excise taxes on beer containing no more than 0.5% alcohol by volume. This is another great victory for Canadian consumers!

This is a step in the right direction and hopefully the start of a national discussion on modernizing the alcohol excise duty structure.

For more information, listen to this Consumer Choice Radio episode

Ontario Government Legalizes iGaming

In the first week of April the government of Ontario launched a legal private online gambling market, which allows for consumers to wager on casino games, sporting events and other gambling activities on websites and apps that are approved by the province’s regulator.

The CCC’s North American Affairs Manager David Clement was invited to participate in the province’s consultation process with both the Attorney General’s Office and the Minister of Finance’s office. In those meetings we highlighted the need for a legal market in Ontario to ensure consumer safety in the online gambling market, and shift consumers away from the black market. 

The CCC is excited to see a safe and legal iGaming market thrive in Ontario, and hope that other provinces follow Ontario’s lead.

Hawaii: Eliminating vape flavors would cause more problems than it would solve

By Yaël Ossowski

When the state acts to protect our children, we trust it will do so with knowledge and responsibility. Considering the rise in availability of vaping products this last decade, it is understandable that the State Legislature has been called on to act.

But if Hawaii curbs the sale of flavored vaping products — intended for adult former smokers — this will not eradicate the problem of youth access. Rather, it may make it even worse.

Health committee chair Rep. Ryan Yamane admitted as much last week, stating “I don’t want our youth who are electronic savvy to get access to unknown supplies or, who knows, black-market cartridges laced with dangerous substances through the internet where we don’t know where it’s coming from.”

What Yamane alludes to is the 2019 EVALI epidemic, when illicit cannabis vaping devices made their way into the hands of thousands of people across the country, causing death and serious lung injuries that spread panic around vaping products. There were 4 cases in Hawaii.

The CDC has concluded that virtually every case was linked to a supply of bootleg THC vape cartridges laced with Vitamin E Acetate. While these products are far removed from the vaping devices found in convenience stores and vape shops, even though activists have attempted to connect them, the EVALI crisis demonstrates the ills associated with unregulated black market products.

Massachusetts enacted a ban on flavored vaping products in 2019 and the results should raise caution. Since the ban, a massive influx of smuggled tobacco and vape products has resulted in a thriving black market, siphoning tax revenue for the state, criminalizing adult consumers trying to make the healthier choice, and exposing kids to black market dealers who don’t ask for ID.

Making a product illegal will not necessarily make the demand for it go away, as the era of Prohibition taught us.

If Hawaii moves forward with a vaping flavor ban, they’ll not only endanger our kids, but they will also push adult consumers to switch back to smoking combustible tobacco, a disaster for public health. Over 1,400 Hawaiians lose their lives to smoking-related illnesses each year. As found in multiple studies and even Public Health England, vapers benefit from 95% less harm than cigarettes.

Fortunately, more than 7% of Hawaii’s adult population uses vaping products, accounting for over 100,000 Hawaiians who have switched to a better alternative, including our elderly. According to data from the Hawaii Journal of Medicine and Public Health, the largest demographic of Hawaiian vapers are actually over 65.

If those retirees have their smoking cession options taken away, it will not only nudge them back to smoking and put their health at risk, but it would cost Hawaii dearly. Smoking-related healthcare costs already cost Hawaiian taxpayers $141.7 million annually, not to mention the pain of long-term illnesses and deaths experienced by many families.

Our goal should be to expand people’s choices to quitting tobacco, not to limit them severely.

What’s more, similar bans to what is proposed here in Hawaii have actually been demonstrated to increase smoking rates among youth in jurisdictions like San Francisco. Data from the Journal of the American Medicine Association shows that the flavored vaping product ban caused increased smoking rates for youth aged 18 and younger.

If we are concerned about youth gaining access to vaping products, we need to ask why it is happening. Are retailers breaking the law and selling it to them? Are they asking older friends or family to acquire for them? Will adult users of these products still have less harmful alternatives to cigarettes if we outlaw them? These are important considerations.

Teenagers seek out risky behavior, whether it is drugs, alcohol, or vaping devices. Education and parental responsibility, however, would be much more effective than a sweeping ban that would boost a new black market and deprive responsible adults of products they have sought to improve their lives. This is the choice Hawaii will have to make.

Yaël Ossowski is deputy director at the Consumer Choice Center.

The case for permissionless innovation in tobacco harm reduction

By Yaël Ossowski

As a consumer advocate enamored with technology, there is nothing more satisfying than seeing a new product or service providing a solution to an old problem.

The entire world of Bitcoin — lightning nodes, censorship resistance, and frictionless cross-border payments — is doing wonders for financial freedom and security.

Ride-sharing and home-sharing apps are putting dormant property to use, providing income for drivers and homeowners and rides and places to stay for tourists and students.

And when it comes to tobacco harm reduction, innovation is picking up at breakneck speed, offering new and more effective ways to wean smokers off the harms of cigarettes. At another time, this is something public health organizations would have praised.

Pod vaping devices, open tanks, synthetic nicotine disposables, snus, heated tobacco products, and nicotine pouches are offering precisely what former smokers need without the same level of risk, all varied to some degree.

It is the permissionless innovation of this entire field — entrepreneurs large and small — that provides such hope to us technological optimists and harm reduction advocates. It excites us to the opportunities that progress can provide.

But for opponents of this particular shade of innovation — whether health groups, academics, or competing lobbies —  the very nature of how these products come to be is what so concerns them.

The vast majority of vaping products and alternative tobacco products are not spawned from public grants, university studies, or government programs, but rather from the process of entrepreneurial discovery, offering solutions to problems that exist in society.

This could be a former-smoker turned vaping entrepreneur with a thriving flavored liquids business run out of his garage, a multinational tobacco firm with thousands of employees, or a group of engineering students who just want to create a cool and safer alternative to the daily pack of cigarettes.

These entrepreneurial forces are reacting to a demand in the market, namely, millions of smokers who want to stub their last cigarette. For many of us, this is a positive example of permissionless innovation. For others, it is nothing more than greed and exploitation.

One can understand that the institutions and lobby groups that oppose efforts at tobacco harm reduction are threatened by private industries providing solutions more effective than the status quo. Or perhaps they even question their intentions.

But the fact remains that millions of former smokers, driven by their own conscious wants and needs, have found an alternative that works for them, provided by firms and entrepreneurs who did not ask for the permission of authorities. That is how our market economies should work.

To that end, new lines of nicotine pouches, vape mods, and disposable vapes are debuted on the market each day, some better than others.

Many of these innovators will fail: perhaps they will create a product that fails to gain customers or blur ethical lines on their advertising that eventually send them to court. Or, as in most cases, will vastly underestimate the cottage industry of governmental lobbying that can only be navigated by the most skilled and politically-connected industries, as the US Food & Drug Administration’s byzantine PMTA process has demonstrated.

That said, we should continue to cheer the innovators that provide us with solutions. And we should support them when their interests, and by extension, ours, are threatened by burdensome regulations and bureaucratic decrees.

When legislators are fed false narratives about lung illnesses and their connection to legal vaping products, as the 2019 EVALI crisis demonstrated, or perhaps are confronted with bombastic claims about a youth vaping epidemic, we must stand up for the people for precisely the people who will be hurt by spontaneous legislation: the adult users of the drug who just want a better option.

There are real externalities that must be dealt with: youth access, dangerous products laced with other compounds, and faulty devices that endanger users.

But we cannot kneecap the permissionless innovation in tobacco harm reduction that is saving lives and giving us solutions we couldn’t even imagine. If that remains a priority for consumer advocates like myself, it will have made all the difference.

Yaël Ossowski is deputy director of the Consumer Choice Center.

Biden’s Digital Assets Executive Order Gets It ‘Mostly Right’ on Protecting Consumers and Innovation in Crypto

Washington, D.C. – Today, President Biden signed an executive order on digital assets, the first major federal executive action relating to cryptocurrencies in the United States.

Yaël Ossowski, deputy director of the consumer advocacy group Consumer Choice Center, praised the order for getting smart cryptocurrency regulation “mostly right”.

“President Biden’s statements demonstrate the federal government’s acknowledgment that Bitcoin and cryptocurrencies will play a positive role in our nation’s future, and offers some key guidance on ensuring the entire crypto economy remains competitive, transparent, and innovative for consumers,” said Ossowski.

“Protecting consumers from scams, giving legal certainty, and allowing for innovation to create new standards for cryptocurrency rules is a responsible and legitimate role for government when it comes to digital assets. We must recognize that the nascent crypto finance space is ever-changing and rapidly evolving and that overzealous regulation could cripple future potential.

“Biden echoed concerns about Bitcoin and cryptocurrency mining, but we believe the environmental benefits from accepting mining will far outweigh any negative repercussions. Crypto mining is an innovative field that strengthens networks and creates incentives for clean energy,” said Ossowski.

“Last year, my colleagues and I at the Consumer Choice Center released our Principles for Smart Crypto Regulation, underscoring the need for preventing fraud, pursuing technological neutrality, reasonably low taxation, and legal certainty and transparency.

“However, considering the toll of inflation on ordinary Americans and the civil liberties concerns related to consumers’ financial privacy, the plans to research a Central Bank Digital Currency are concerning and will need much more scrutiny in the months to come.

“Overall, we praise the administration’s efforts on keeping cryptocurrency legitimate and accessible and hope any legislation to come will follow these bedrock principles. We’re all going to make it,” concluded Ossowski.

Congress wants to sneak in an effective ban on synthetic nicotine vaping that would harm consumers

WASHINGTON, D.C. – This week, it was revealed that several congressmen and US senators have added a provision in the upcoming emergency government funding bill that would relegate tobacco-free synthetic nicotine to the regulatory authority of the Food and Drug Administration and its premarket tobacco application process.

This would give vaping firms less than two months to file a lengthy and convoluted Premarket Tobacco Application (PMTA), which will ultimately lead to most small vaping firms and shops going out of business.

Yaël Ossowski, deputy director of the Consumer Choice Center, said this will actively harm adults who want to quit smoking.

“The byzantine process of asking permission to sell harm reducing vaping products in the 21st century is asinine in itself. But using sleight of hand during an emergency government funding bill to castigate millions of vapers and the entrepreneurs who make and sell the products they rely on is the definition of active harm,” said Ossowski.

“Only the largest and most powerful vaping and tobacco companies can afford the lawyers and the time necessary to complete the paperwork necessary to pass the FDA’s process, meaning thousands of hard-working American business owners will now be forced to close, depriving millions of adult consumers of harm reducing options. Many will be forced back to cigarettes.

“Synthetic nicotine is an innovative method of providing nicotine independent of tobacco, and millions of American adults now use these products as a less harmful method of consuming nicotine. A back door bureaucratic power move like this represents a sledgehammer to the men and women of our country who have sought out vaping devices to kick their cigarette habit,” added Ossowski.

“The method of fattening up continuing resolution bills with laws that benefit special interests, without broader democratic debate or analysis of the costs and benefits, is shameful in our modern American Republic.

“We hope our elected representatives reject this particular provision on synthetic nicotine and go back to the drawing board to offer a more permanent, sane, and smart policy on the next generation of vaping products,” said Ossowski.

41% of European consumers agree that sharing economy apps make life easier

The Consumer Choice Center commissioned the market research company Savanta to survey European consumers on four different EU policy-making areas: Consumer Choice and Government; Innovation & Sharing Economy; Agriculture & Food; and Science & Energy.

In February 2022, 500 people were surveyed in Belgium on their views on innovation, nuclear energy, agriculture, sharing economy, and government intervention in the economy.

Maria Chaplia, the Research Manager at the Consumer Choice Center, said: “The polling results are encouraging. European consumers overwhelmingly appreciate consumer choice. A wide array of agricultural regulations put forward by the EU and member states are at odds with what European consumers want.”

Key findings:

  • 69% of European consumers agree that the government should not restrict their freedom to choose.
  • 73% of European consumers think that the European Union should be more open to innovative solutions.
  • Two times more European consumers (41% agree and 22% disagree) agree that sharing economy apps makes their lives easier.
  • 69% of European consumers interviewed agree that innovation plays an important role in making their lives better.

“Innovation has made millions of European consumers better off. Thanks to platform economy apps such as Uber, Deliveroo, and many others, consumers can now choose between various delivery and transportation options. No wonder European consumers value the sharing economy apps so much,” said Chaplia.

“Platform economy apps have boosted consumer choice and given many Europeans the opportunity to work independently. Gig work provides flexibility which increases its attractiveness to many Europeans. However, in December 2021, the European Commission presented plans to regulate gig workers’ work conditions, which will essentially diminish the self-employment model. The overregulation of platforms will have spillover effects on consumer choice, and the EU should abstain from such moves,” concluded Chaplia.

Banning Flavored Vaping Products Will Do More Harm Than Good in Maine

This year, state lawmakers introduced two bills that would outlaw flavors for liquids used in nicotine vaping devices. The bills, LB 1550 and LB 1693, would ultimately harm adult users of these products, likely driving them back to using tobacco. These bills are currently being reviewed by the joint committees and will soon go to a vote.

Yaël Ossowski, deputy director at the D.C.-based Consumer Choice Center, said “enacting a flavor ban for vaping products will do more harm than good as it will push adult consumers to switch back to smoking combustible tobacco. Considering that studies have shown vaping to be 95% less harmful than smoking, ensuring that adult consumers have access to the vaping products they prefer will ultimately lead to fewer cigarette smoking-related deaths within the state.

“More than 4.1% of Maine’s adult population uses vaping products, accounting for over 54,000 consumers within the state who have switched to a healthier alternative to combustible tobacco. Banning flavored vaping products will encourage these former smokers to switch back to smoking cigarettes and will ultimately lead to increases in smoking-related healthcare costs, which are already costing (state) taxpayers over $262.6 million annually,” said Ossowski.

“If a flavor ban is enacted, then consumers will likely look towards the black market in order to get access to their preferred flavored vaping products. This presents serious concerns for public health as vapers will be purchasing unregulated products that could be extremely dangerous to their wellbeing.

“In addition to endangering public health, pushing consumers to the black market through a flavor ban will also be to the detriment of many vape shops throughout the state as many of their products will no longer be available. After already suffering through the economic hardships of the pandemic, this bill could effectively kill many of these small businesses already struggling to stay afloat. 

“Instead of implementing misguided flavor bans, lawmakers should embrace vaping products in order to protect public health, small businesses, and consumer choice throughout the state,” said Ossowski.

European consumers agree that the EU is too cautious about GMOs

The Consumer Choice Center commissioned the market research company Savanta to survey European consumers on four different EU policy-making areas: Consumer Choice and Government; Innovation & Sharing Economy; Agriculture & Food; and Science & Energy.

In February 2022, 500 people were surveyed in Belgium on their views on innovation, nuclear energy, agriculture, sharing economy, and government intervention in the economy.

Maria Chaplia, the Research Manager at the Consumer Choice Center, said: “The polling results are encouraging. European consumers overwhelmingly appreciate consumer choice. A wide array of agricultural regulations put forward by the EU and member states are at odds with what European consumers want.”

Key findings:

  • 67% of European consumers would like the European Union to embrace technologies that make food more affordable.
  • 59% of European consumers trusted farmers to use crop protection products adequately to make safe food.
  • 33% of European consumers agree that the EU is too cautious about genetically modified organisms.
  • 59% of consumers interviewed agree that the European Union often over regulates at the expense of European Consumers.
  • 73% of consumers think that the European Union should be more open to innovative solutions.

“The EU shouldn’t restrict farmers’ freedom to use the preferred crop protection tools to avoid these unintended consequences. Alternatively, the EU should consider legalizing genetic modification. European consumers trust farmers to choose crop protection tools to make food safe. Despite popular rhetoric, there is no substantial scientific evidence of the health and environmental risks ascribed to GM products,” said Chaplia.

“The war in Ukraine, one of the largest wheat exporters in the world, threatens European and global food security. At such a challenging time, the EU cannot simply afford to pursue expensive organic ambitions. Now is the time to embrace innovation over unjustified precaution,” concluded Chaplia.

Ontario makes cannabis delivery and curbside pickup permanent

Ontario retailers were granted a temporary permit to offer cannabis delivery and pick-up services during the pandemic when alcohol and cannabis retail were deemed essential businesses.

Our Northern American Affairs Manager David Clement went a step further and argued in favor of making cannabis delivery permanent. According to him “It would significantly benefit retailers. But more importantly, it would benefit consumers by expanding and enhancing their options.”

We are happy to hear that the “provincial government has permanently green-lit the ability of cannabis retailers to offer delivery and curbside pickup services”. 

This is a step taken in the right direction but more needs to be done for making the cannabis delivery process smoother. There are a strict set of rules that need to be followed to comply with approved delivery or curbside pickup, and for now, third-party delivery is not permitted. 

Delivery can only be done by a retail store authorization holder or its employees, which makes it hard to keep up with the rising demand. Retailers aren’t equipped with the capital nor the expertise to operate a fleet of vehicles. The Ontario government should allow the use of third-party services to deliver, which we already permit for alcohol. Having a chance to outsource delivery to a third-party service, like delivery apps, gives legal retailers a leg up on the black market, which is still very prevalent.

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