The Knesset's Finance Committee approved on Sunday a law applying Israel's tax on cigarettes to Philip Morris' IQOS electronic cigarettes.
The move comes after a year-long battle, fought by Israel's Avir Naki (literally "clean air") organization, "Smoke Free Israel," the Organization for Progressive Democracy, and bipartisan MKs, against Finance Minister Moshe Kahlon (Kulanu), who categorically refuses to raise taxes or apply them to items not previously taxed, and Finance Committee Head Moshe Gafni (UTJ).
The Organization for Progressive Democracy and Smoke Free Israel had submitted an appeal to the Supreme Court, asking the court to force Kahlon to tax IQOS as cigarettes until there is substantial, and substantiated, proof that IQOS are not as harmful as regular cigarettes.
Glick threatened on Sunday not to vote for the State budget until IQOS is taxed as cigarettes. Kahlon had signed the bill earlier this year, but Finance Committee Head Moshe Gafni (UTJ) refused to support the bill until Sunday.
The new tax is expected to generate 120 million NIS ($34,856,400) annually, and it will be applied to those IQOS already in stores as well.
The cigarette manufacturer. Philip Morris, responded, "It is unfortunate and illogical that the State decided to limit smokers' access to novel smokeless tobacco products by regulating and taxing them similarly to cigarettes, in full contradiction to the position taken by many governments around the world and without thoroughly reviewing the science pertaining to these products."
"There is growing recognition across the world that nicotine-containing products exist on a continuum of decreasing risk – cigarettes representing the highest risk – from countries including the US and UK. Regulatory and tax regimes should take account of these differences. Israel chose to tax the tobacco heating units the same way as cigarettes, while RYO (rolling - ed.) tobacco, whose damage is the same as cigarettes, has a much lower tax burden. In practice, the State encourage us to continue focusing on our cigarettes and RYO products, instead of providing novel smokeless tobacco products that are a better alternative to adult smokers who intend to continue smoking. We think this is a missed opportunity. However, we remain committed to the goal of designing a smoke-free future and look forward to the opportunity to work with the government to help make Israel smoke-free."
Efforts are currently underway to raise the tax on rolling tobacco to match that of regular cigarettes, but Kahlon, who has lowered taxes on several products since taking office, refuses to hear of it. As a result, Israeli smokers including teens and soldiers looking to save money turn to rolling tobacco, instead of working to quit their unhealthy habit.
The number of smokers in Israel rose from 19.7% in 2015 to 22.5% in 2016, and the number of IDF soldiers who smoke at discharge stands at 37%.