Chinese synthetic nicotine will seize the global market
Small and medium-sized electronic cigarette manufacturers in the United States turn their attention to Synthetic Nicotine. PMTA’s high application fee and technical threshold make small and medium-sized e-cigarette enterprises in trouble, so it turns its attention to Synthetic Nicotine.
At present, FDA mainly regulates the extraction of nicotine, while Synthetic Nicotine is in a regulatory vacuum. FDA defines tobacco products as any product made from or extracted from tobacco for human consumption, including any components, parts or accessories of tobacco products.
Therefore, more and more manufacturers use Synthetic Nicotine as a means to bypass FDA regulations. Due to the strong price advantage and large production scale of Synthetic Nicotine, the downstream e-cigarette industry is expected to greatly apply synthetic nicotine to replace natural nicotine in the future.
At the same time, the e-cigarette industry is not sensitive to the price of nicotine contained therein, giving Synthetic Nicotine a fertile land for substantial profit. The compound growth rate of Synthetic Nicotine market is expected to be about 30% in the future.
China’s new regulations limit nicotine sales, and Synthetic Nicotine is more conducive to supervision. The decision on Amending the regulations for the implementation of the tobacco monopoly law of the people’s Republic of China (Draft for comments) puts forward the regulatory idea of “electronic cigarettes and other new tobacco products shall be implemented with reference to the relevant provisions on cigarettes in these Regulations”.
Strict supervision of e-cigarettes will lead to the production side paying more attention to product quality and supervising e-cigarette manufacturers to use nicotine from formal and legal sources. At present, natural nicotine is limited by the mixed supply sources of China tobacco system, and the compliance risk is high. The raw materials of Synthetic Nicotine can be traced to the source, so that the whole process of electronic cigarette products can be monitored from the source. The new deal will help to improve the permeability of Synthetic Nicotine. It is predicted that the national policy will continue to benefit the Synthetic Nicotine enterprises in the future.
In our country, the approximate tax rate, ad valorem and ad valorem are parallel, and the tax focus tends to ad valorem tax. The state has certain control over nicotine. The tax policy is likely to tax smoke bombs. Since the focus of taxation is on production, the key is the specific tax rate in the production link. Nicotine is the core link of e-cigarette supervision. If the ad valorem tax is focused, the manufacturer will mediate the nicotine content of a single shot. Therefore, the tax focus tends to be specific tax.
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