Vape tax takes effect as ministers target youth vaping and illicit trade
A new excise duty of 2.20 pounds per 10ml applies from today, with duty stamps rolling out on retail packaging and tobacco duty rising alongside it.
A new excise duty on vaping products has come into force across the United Kingdom today, as ministers move to reduce the affordability and appeal of vaping, particularly among young people and non-smokers. The Vaping Products Duty is charged at 2.20 pounds per 10ml of vaping liquid and will be paid by manufacturers, importers and warehousekeepers approved by HM Revenue and Customs.
The flat rate applies to all vaping liquids, whether or not they contain nicotine. HMRC said it is a commercial decision for businesses whether the cost of the duty is passed on to retailers and consumers. To put the rate in context, a 10ml refill bottle will carry 2.20 pounds in duty, while a 2ml pod will carry 44p.
Alongside the duty, HMRC has launched the Vaping Duty Stamps Scheme. Duty stamps will begin appearing on retail packaging from today, and the Government says that once fully rolled out they will provide digital traceability through the supply chain, helping legitimate businesses and the fight against illicit trade. A six-month grace period allows wholesalers and retailers to sell existing eligible unstamped stock until 31 March 2027. From 1 April 2027, every vaping product sold in the UK must carry a valid duty stamp.
Our new measures will help get illicit vapes off high streets across the country.James Murray, Financial Secretary to the Treasury
James Murray, the Financial Secretary to the Treasury, said: "Our new measures will help get illicit vapes off high streets across the country. We're backing all those retailers who play by the rules by making it easier for law enforcement agencies to take action against those who don't."
Tobacco duty has also risen today, by 2.20 pounds per 100 cigarettes or 50 grams of tobacco on top of the standard duty escalator, to preserve the financial incentive for smokers to switch to vaping. The Office for Budget Responsibility forecasts that the vaping duty will raise more than 550 million pounds a year by 2030-31.
The industry warned the duty would hit adults who have given up cigarettes. John Dunne, director general of the UK Vaping Industry Association, said: "The immediate impact of the Vaping Products Duty will be to make vaping significantly more expensive for millions of adults, including people who have switched completely away from cigarettes." The campaign group ASH estimates that around 5.5 million people vape in the UK, roughly one in ten adults.
The Government is investing 30 million pounds of new funding each year until 2028-29 for Trading Standards, Border Force and HMRC to tackle illicit and underage sales of tobacco and vapes. Travellers arriving in Great Britain can bring up to 50ml of vaping liquid for personal use without paying duty and tax.
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