Japan Tobacco Tax Revenue Reaches 2 Trillion Yen: Truth Behind Tobacco Taxation

JTI by 2FIRSTS.ai
Apr.18.2024
Japan Tobacco Tax Revenue Reaches 2 Trillion Yen: Truth Behind Tobacco Taxation
Smoking cessation in Japan leads to questions about the use of tobacco tax revenue in various sectors.

According to a report from "JAF Mate Online" on April 17th, it may not necessarily be a good thing for non-smokers if everyone were to quit smoking. Since 2000, the number of smokers in Japan has been decreasing, but due to the increase in tobacco prices, tobacco tax revenue has remained above 2 trillion yen for over 20 years. So, where exactly is this large sum of tax money being used? And what would happen if tobacco tax revenue were to disappear? Economic commentator and economist Mr. Takafumi Kadokura has commented on this issue.

 

Mr. Tokumura Guishi mentioned, "The purpose of tobacco taxes is not clearly disclosed to the public. Taxes are generally divided into specific purpose taxes and general taxes. Taxes designated for specific purposes are called specific purpose taxes, but tobacco taxes are not specific purpose taxes, so we are not sure where this tax revenue is being used. If we were to guess, local governments are likely using this tax revenue for disaster relief, road and sewer construction, education facility construction, and the operation of elderly welfare institutions, among other things. I believe it is definitely being used to improve the lives of residents."

 

Over the past 20 years, there has been minimal change in tax revenue of 2 trillion yen, while the number of smokers has actually decreased significantly. Many are questioning whether this phenomenon is due to the increase in tobacco prices.

 

In the interview, Mitsufumi Monokura said, "For the past 20 years, tobacco tax revenue has remained around 2 trillion yen. Despite a significant decrease in the number of smokers, this has been offset by the increase in tobacco prices. A pack of cigarettes now costs 580 yen, with only 222 yen being the cost of the tobacco itself, the remaining roughly 60% is taxes. Regardless of fluctuations in the number of smokers, tobacco tax revenue has consistently remained at 2 trillion yen. After increasing taxes, some people may quit smoking, but others will continue to smoke regardless of the price. Personally, I believe that the Ministry of Finance has done a good job in maintaining tax revenue at 2 trillion yen through their pricing strategy."

 

Smokers are hoping to increase the number of smoking places through tobacco taxes, but opponents of smoking argue that due to the health hazards of passive smoking, medical expenses will increase. Even with tax revenue, the overall burden on the nation will also increase, so it's best not to smoke. Due to objective data showing that heated tobacco products reduce health risks to those around them, Takefumi Monzen believes that making heated tobacco products an option is a balanced approach for both smokers and non-smokers.

 

At the end of the interview, Takanori Kadokura explained, "Despite the rising prices of tobacco and the policies implemented since 2020 to reduce smoking, it should not be overlooked that reducing the number of smokers to zero would also mean a loss of 2 trillion yen in tax revenue. In that case, other sources would need to make up for this gap. For example, the 2 trillion yen in tobacco tax is equivalent to 1% of the consumption tax. If this revenue disappears, it may be necessary to increase the consumption tax by 1%, eventually impacting non-smokers negatively in terms of tax burden. Therefore, smokers and non-smokers need to come up with some compromise solutions, such as smokers considering using reduced-harm heated cigarettes to lessen health risks, while the government can still maintain a stable tax revenue. Opponents of smoking also need to consider that secondhand smoke can lead to higher medical expenses, even if there is tax revenue to offset it. Therefore, quitting smoking is the better choice. However, opting for heated cigarettes can mitigate the health impact on those around you. Personally, I believe choosing heated cigarettes can be a compromise solution for both smokers and non-smokers."

 

We welcome news tips, article submissions, interview requests, or comments on this piece.

Please contact us at info@2firsts.com, or reach out to Alan Zhao, CEO of 2Firsts, on LinkedIn


Notice

1.  This article is intended solely for professional research purposes related to industry, technology, and policy. Any references to brands or products are made purely for objective description and do not constitute any form of endorsement, recommendation, or promotion by 2Firsts.

2.  The use of nicotine-containing products — including, but not limited to, cigarettes, e-cigarettes, nicotine pouchand heated tobacco products — carries significant health risks. Users are responsible for complying with all applicable laws and regulations in their respective jurisdictions.

3.  This article is not intended to serve as the basis for any investment decisions or financial advice. 2Firsts assumes no direct or indirect liability for any inaccuracies or errors in the content.

4.  Access to this article is strictly prohibited for individuals below the legal age in their jurisdiction.

 

Copyright

 

This article is either an original work created by 2Firsts or a reproduction from third-party sources with proper attribution. All copyrights and usage rights belong to 2Firsts or the original content provider. Unauthorized reproduction, distribution, or any other form of unauthorized use by any individual or organization is strictly prohibited. Violators will be held legally accountable.

For copyright-related inquiries, please contact: info@2firsts.com

 

AI Assistance Disclaimer

 

This article may have been enhanced using AI tools to improve translation and editorial efficiency. However, due to technical limitations, inaccuracies may occur. Readers are encouraged to refer to the cited sources for the most accurate information.

We welcome any corrections or feedback. Please contact us at: info@2firsts.com

Latest UK ONS Data: 54% of Vapers Are Former Cigarette Smokers, 26% Also Smoke and 20% Never Smoked Regularly
Latest UK ONS Data: 54% of Vapers Are Former Cigarette Smokers, 26% Also Smoke and 20% Never Smoked Regularly
Former cigarette smokers accounted for an estimated 54% of current e-cigarette users in Great Britain in 2025, while 26% also smoked cigarettes and 20% had never regularly smoked, according to a 2Firsts analysis of Office for National Statistics (ONS) data. Among former cigarette smokers who currently vape, approximately 81% used e-cigarettes daily, compared with about 50% of dual users. The ONS found that 33.8% of current cigarette smokers also vaped in 2025, up from 10.6% in 2014. Approximately 1.1 million adults who had never regularly smoked cigarettes used e-cigarettes, representing 2.9% of that population, compared with 0.2% in 2014. The figures highlight differences in the composition, frequency of use and long-term trends across Britain's vaping population.
DATA
Oct.14
Indonesia's Influential Islamic Body MUI Urges Vape Permit Freeze, Raising Uncertainty for 200 Manufacturers
Indonesia's Influential Islamic Body MUI Urges Vape Permit Freeze, Raising Uncertainty for 200 Manufacturers
Indonesia's Ulema Council (MUI) published Fatwa No. 131/2026 on November 9, declaring electronic cigarette use, production and trade haram under Islamic religious rules. The council urged the Industry Ministry to prohibit the issuance of vape industry permits and review licensing policies, while calling on the president and parliament to enact a comprehensive ban. On November 10, the Constitutional Court heard a challenge to provisions of the 2023 Health Law seeking a prohibition on vape production, importation, distribution and use. The Health Ministry said on November 11 it was studying stronger restrictions, including a possible ban on circulation, while industry association APVI called for tighter oversight rather than a total ban. Indonesia's Industry Ministry previously estimated the sector comprises about 200 companies, Rp31 trillion ($1.7 billion) in cumulative investment and approximately 100,000 supply-chain jobs. No nationwide statutory ban has been enacted.
Regulations
Nov.12
Product|AIR Files U.S. PMTA for Crown Switch. Can Greentank's Chip Technology Deliver a Compliance and Competitive Advantage?
Product|AIR Files U.S. PMTA for Crown Switch. Can Greentank's Chip Technology Deliver a Compliance and Competitive Advantage?
AIR Global PLC (NASDAQ: AIIR) announced on November 5, 2026, that it had submitted a Premarket Tobacco Product Application (PMTA) to the U.S. Food and Drug Administration (FDA) for Crown Switch, its rechargeable pod vape platform. First launched in Germany in November 2025, the device uses Quantum Chip atomization technology developed by Canadian vaporization technology company Greentank Innovations. German retail versions feature 2mL prefilled pods containing 18mg/mL nicotine in six flavors, while AIR has separately tested two 5% nicotine formulations intended for U.S. development. AIR invested $20 million in Greentank in July and reported approximately $3.4 million in U.S. PMTA-related regulatory costs for the first nine months of 2026. The Crown Switch application has been submitted, but the FDA has not granted marketing authorization.
product
Nov.13
FDA Revises Import Alert 98-07 Rules, Bringing May Enforcement Priorities Into Unauthorized ENDS Detentions
FDA Revises Import Alert 98-07 Rules, Bringing May Enforcement Priorities Into Unauthorized ENDS Detentions
The U.S. Food and Drug Administration has revised the rules under Import Alert 98-07 to incorporate its May 2026 enforcement-priority policy for certain electronic nicotine delivery systems marketed without premarket authorization. The alert continues to allow detention without physical examination, or DWPE, for ENDS lacking required marketing authorization, while directing field divisions to apply the May risk-based framework. When necessary, detention or refusal decisions must also undergo review by the FDA's Center for Tobacco Products. Products including PACHA and Vuse Pro have already emerged as industry examples of the May policy, although enforcement discretion does not constitute FDA marketing authorization.
News
Sep.28 by 2Firsts Perspectives
Product | KIWI Launches Spark 2 and Spark 2 Pro in Germany, Two Hardware Tiers Share Backward-Compatible 2ml Pods
Product | KIWI Launches Spark 2 and Spark 2 Pro in Germany, Two Hardware Tiers Share Backward-Compatible 2ml Pods
KIWI has launched the Spark 2 and Spark 2 Pro refillable pod systems in Germany at official prices of €18 and €29, respectively. Spark 2 uses an 800mAh removable lithium-ion battery in a pen-style body, while Spark 2 Pro features a 1,400mAh removable battery, a box-shaped design and vibration feedback every 20 puffs. Both devices use the same 2ml Spark V2 pods in 0.8Ω and 1.2Ω versions, with AirSync airflow adjustment and a choice between Cotton Tips and conventional Drip Tips. The new pods also remain compatible with the original KIWI Spark.
News
Sep.29 by 2Firsts Perspectives
RLX Technology Dropped From FTSE All-World as International Business Reaches 68.5% of Q2 Revenue
RLX Technology Dropped From FTSE All-World as International Business Reaches 68.5% of Q2 Revenue
RLX Technology (NYSE: RLX) has been removed from the FTSE All-World Index, effective September 21. FTSE Russell records show RLX was already part of its global equity index universe by 2022, when its American depositary receipts were classified as China Large Cap securities. Trading volume rose to about 44.77 million shares on September 18, roughly 23 times the previous session's volume. RLX reported RMB1.0105 billion in second-quarter revenue, up 14.8% year over year, with international operations contributing 68.5%. The company also acquired a 51% stake in one of Western Europe's largest distributors of next-generation smoke-free and FMCG products in July.
Sep.22