Proposed U.S. Tariffs Threaten Vaporizer Industry
“The rationale behind this administration’s trade war against China is twofold: stealing American jobs and stealing American IP and know-how,” Arnaud Dumas de Rauly, co-founder and co-CEO of the New York-based vape company, The Blinc Group, tells Freedom Leaf. “However, as it pertains to vaping products, none of these jobs and know-how are in the U.S. to begin with. The cannabis industry will suffer from these tariffs.
“The supply of raw material isn’t big enough in the U.S. to support a switch to U.S. manufacturing,” he continues. “The skillsets aren’t in the US either. Bottom line, these tariffs will not bring jobs to America. In addition, given the small margins (10-15%) on the hardware, the cost of these tariffs will be passed on to consumers, which will limit patient/consumer access to cannabis products, especially in states like Florida and New York, whose medical programs relay on vaping products. Finally, the regulatory uncertainty is already stifling the cannabis industry, so this trade war will be adding ‘federal action’ onto already struggling businesses. It just doesn’t make sense, not to mention the loss of taxes on a state level that will result from the limited access.”
ARNAUD DE DUMAS RAULY: “These proposed tariff increases will do great harm to American businesses, medical marijuana patients and adult use consumers.”
On July 24, Dumas de Rauly testified at public hearings conducted by The Office of the U.S. Trade Representative regarding proposed tariffs on $16 billion worth of Chinese products.
“These proposed tariff increases—including HTS No. 8543709930 and HTS No. 8543709940 related to vapor product devices, batteries intended for use in vaping devices, and pre filled pods and cartridges—will do great harm to American businesses, medical marijuana patients and adult-use consumers while doing nothing to empower American companies to manufacture these products themselves,” he stated, adding: “The current administration’s trade war raged against China will: 1. reduce access to reduced risk vapor products and therapeutic cannabis products to American citizens; 2. not bring back jobs to America; and 3. cut current medical marijuana and adult-use states tax revenues by over 25%.
“Increasing tariffs may have worked 20 years ago, when U.S. manufacturing was at its highest, but given the current economy, it’s a major mistake to believe that this will bring jobs back to American citizens.”
Dumas de Rauly is also Chair of the ISO/TC126/SC3 Standards Committee on Vapor Products.
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