In recent years, the e-cigarette market has been developing rapidly, and the market has increased sharply. According to the 《2021 E-Cigarette Industry Blue Book》, there are more than 1,500 e-cigarette manufacturing and brand-related enterprises in China by the end of 2021, among which there are more than 1,200 manufacturers. In Baoan, Shenzhen, an important producer of e-cigarettes, the output value of e-cigarettes reached 31.1 billion yuan in 2021, doubling year-on-year.
With the rapid development of the e-cigarette industry, some enterprises have been working hard and even “growing savagely”, resulting in frequent industry chaos. In this regard, the country continues to strengthen the regulation of the e-cigarette market, especially the official implementation of the new national standard of e-cigarette on October 1, 2022, and the imposition of consumption tax on e-cigarette on November 1, marking a new stage of standardized development of the electronic cigarette industry.
According to the data of enterprises check, there are more than 160,000 vaping-related enterprises in China, among which Shenzhen ranks first with 12,000 vaping-related enterprises. Shajing Street in Bao ‘an District is known as “e-cigarette Street” and is the core area of the world-class e-cigarette industry manufacturing base.
In July 2020, the first e-cigarette share of Smoore International was listed on the Hong Kong Stock Exchange. It soared on the opening day and its market value once exceeded HK $160 billion, which ushered in a highlight moment for the e-cigarette industry. Since then, the head company of e-cigarette brand RELX, Wuxin Technology, has been listed on the New York Stock Exchange with a market value of nearly 300 billion yuan, pushing the popularity of e-cigarettes to its peak.
On November 1st an excise tax was introduced on e-cigarettes. According to relevant regulations, the tax payment of e-cigarettes shall be calculated based on price fixing rate. The consumption tax rate of e-cigarettes production (import) is 36%, and that of e-cigarettes wholesale is 11%.
The major e-cigarette companies responded quickly. Many e-cigarette brands, such as RELX, FLOW, Ono and VVILD, raised their suggested retail prices, with most brands increasing by more than 30%. Taking Yuetke as an example, the wholesale price of its four types of tobacco ranges from 32.83% to 95.3%, and the suggested retail price ranges from 33.52% to 97.49%. The biggest increase was in both wholesale and suggested retail prices, which rose about 82 percent.
At present, national standards, management measures and taxation policies of e-cigarettes have been issued, and relatively comprehensive regulations have been made for the e-cigarette industry from the aspects of product quality, licensed operation and taxation, which is conducive to the healthy and orderly development of the industry.
Post time: Nov-07-2022
