Whether it tastes like pineapple, cola, ice cream or hazelnuts – hookah tobacco has a wide variety. Hookah is fashionable. The revised tax laws are currently causing annoyance in the niche industry.
Until now, shisha bars and German tax laws have been like fire and water: they just don’t fit together. Customs officers repeatedly find violations of the “prohibition of isolation”:
From a large package, bars sell their customers individual small portions of hookah tobacco. What is legal with coffee – there, too, the restaurateur pays for a large package and then resells smaller portions – is forbidden with tobacco. It will be done anyway. There are legal ways, but they are very expensive. Now the new regulation should resolve the dilemma. However, it does have side effects.
Only smaller sales quantities are allowed
Until now, 200 gram packs have been the standard for flavored moist tobacco, and packs of one and two kilograms are also sold. Depending on your preferences, you’ll need about 20 grams to fill a bowl of shisha. This means: if you buy a 200 gram pack, you have about 10 servings, for a kilo pack it is 50. However, the regulation that will apply from July 1 stipulates that only packs weighing a maximum of 25 grams may be sold – all larger ones are forbidden.
The logic behind this: with such small packages, it is no longer “separated” because there is not enough quantity. This prevents the current widespread violation of the tax law. What sounds plausible is causing criticism in the shisha industry.
Because, according to the Bundesverband Wasserpfeifentobak, around 100 German producers had far too little time to transform their production. Only six to seven of the 100 German hookah tobacco companies are already able to produce small packages, says Folke Rega, the association’s managing director.
So if large packages cannot be sold from July onwards, there will be delivery problems. Old stocks can still be sold, but they will probably be largely used up in a few months’ time. “In the fall, the sales shelves may be partially empty because producers are lagging behind with production,” says Rega. The association is concerned that consumers will drift in the black market. “If domestic supply can no longer meet demand, illegal paths will be taken.” The association is calling for the temporary suspension of the maximum size regulation until spring 2024.
Complaint for additional garbage
There is a lot of anger among hookah owners. “Plastic straws have been banned for environmental reasons,” says one, asking not to be named. “But now we’re creating a lot of extra garbage in the bar because of the small packaging.”
Frank Buckenhofer of the Police Association (GdP) doubts that there will be significantly fewer tax breaches in the shisha bars as a result of the regulation. “There are honest shisha owners and they are dishonest – and dishonest ones will not be impressed with the new regulation.” The incentive to continue scoring Big Packs on the black market will be high.
Criticism is approved in some parts of the policy. “I think reducing the size of the package is a wrong approach and I understand the reluctance in the industry about the costs involved,” says Bundestag CSU member Sebastian Brehm. With more waste in mind, he found that smaller packaging was “much more harmful to the environment”. “A way must be found to ensure that the current packaging sizes are not bureaucratic and practical,” says an opposition politician.
Understanding is also expressed by the ranks of the traffic light coalition. FDP MP Till Mansmann warns of “weakening the supplier market, which will ultimately only benefit the black market.” “Many companies and tax-honest customers are suffering.” One is open to “adapting the regulation”.
However, according to the statements of the SPD and the Greens, the packing rule is unlikely to change. Green MEP Sascha Müller says that a longer implementation period could have been envisaged. “However, the industry concerns did not reach us until late, and a correction would only be possible by changing the regulation.” This would happen in October at the earliest. “In our opinion, it would be too late to postpone this entry into force and it would undermine the efforts of resource-intensive companies to switch their production by July 1.”
Social Democrat Michael Schrodi does not think too much about the argument that the packaging regulation could lead to a flourishing black market. Shaking his head, he complains that the industry is “only warning of another black market at the last minute and shortly before it goes into effect.” There is a danger of “talking in practice about developing a black market,” says an SPD MP.
Doctors warn of the risk of cancer
There are about 5,000 shishas in Germany. According to industry estimates, three-quarters of the turnover that tobacco producers get from shisha products comes from private consumers and the rest from shisha bars. German manufacturers and importers have annual sales of one billion euros. In the case of hookah, flavored moist tobacco is heated and inhaled. Doctors warn of cancer risks and other health hazards.
Not only the small supply on the market may soon become an unpleasant surprise for shisha users. Because: it will be much more expensive. According to estimates by the trade association, hookah tobacco will cost around twice as much in the future as at the end of 2021. On the one hand, this is due to the additional tax that has been in force since this year, and on the other hand, it is due to more expensive production. According to the association, the investment costs would have to be recovered. Moreover, the production and distribution of small packages per gram is more complex than large packages. (dpa)