In a bold move to address public health and fiscal challenges, the UK government has announced plans to introduce a new tax on vaping products from October 1st 2026, sparking widespread debate and speculation about its potential consequences.
This article will explore the potential effects of the UK’s new vaping tax, focusing on its impact on public health efforts, and the vaping industry and ultimately uncovering what this tax could mean for the future of vaping in the UK.
Proposed Rates Structure
The prosed tax uses a strength-based tiered system as follows:
£1.00 per 10ml for nicotine-free liquids
£2.00 per 10ml on liquids that contain approximately the same or less nicotine (per ml) than in an average cigarette (0.1-10.9 mg)
£3.00 per 10ml on liquids that contain roughly more nicotine per ml than in an average cigarette (11mg or more)
Pros
Make it Too Expensive for Youths To Purchase
One of the goals of introducing a vaping tax is to keep young people away from vaping. This is to help them avoid the health risks linked to nicotine and possibly smoking cigarettes later. If vaping products cost more because of taxes, young people, who usually have limited pocket money, might not want or be able to buy them. This strategy can lead to fewer young people getting hooked on nicotine, reducing the risk of them transitioning to tobacco smoking, which is more harmful.
Invest in the Environment
Material Focus highlights that ‘33% of all vapes get thrown away on average—3 million vapes per week, 11,950,187 vapes per month, or 143,402,244 vapes per year’. By imposing taxes on vaping products, the government can generate revenue specifically allocated to environmental conservation efforts, such as recycling programs tailored to handle electronic waste and prevent battery fires in bin lorries and recycling centres.
The extra revenue could also fund programs that help the public dispose of vape products efficiently, lessening the environmental damage and promoting a broader societal change toward adopting sustainable consumption habits.
Generate Revenue for the NHS
Taxing vaping products can significantly generate revenue for the NHS by creating a new, consistent source of income. This additional income could directly support the NHS’s quit smoking campaign , enhancing its financial stability to ensure it continues to provide high-quality care around the UK while still addressing public health concerns associated with vaping.
While vaping is often marketed as a safer alternative to smoking, ‘the long-term risks of vaping are not yet clear’. Therefore, taxing these products sends a clear message about the need for regulation, supports research into the long-term effects of vaping, and funds educational campaigns on its risks.
Cons
Impact of Quitting Smoking Efforts
Vaping is widely recognised as a less harmful alternative to traditional cigarettes, and many smokers have successfully transitioned to vaping as a step towards quitting nicotine altogether. Imposing taxes on vaping products, including e-liquids, may discourage smokers from seeking a less harmful alternative, ultimately hampering their quitting journey.
However, according to The Guardian, Jeremy Hunt announced plans to not only tax vaping products but also increase tobacco duty ‘to ensure it remains more expensive than vaping’. Yet, Economic Affairs states that those who gave up smoking with the help of the government encouraging vaping as an alternative feel they are now being punished for it.
Encourage Unregulated Market Growth
When legal vaping products become more expensive due to taxation, consumers may seek cheaper alternatives, leading them towards unregulated and potentially unsafe products. The unregulated market lacks quality control and safety standards, increasing the risk of exposure to harmful substances not present in regulated products. This shift not only undermines the safety advancements achieved through regulation but also complicates efforts to monitor and manage public health impacts.
The rise of an unregulated market can lead to lost tax revenue, negating some of the financial benefits the vaping tax aimed to achieve. Therefore, while the intention behind taxing vaping products might be to generate revenue or discourage vaping, driving consumers towards an unregulated market could unintentionally compromise public health and safety.
Risk of Undermining Small Businesses
Small businesses like independent vape shops and local manufacturers often operate with narrow profit margins. Taxing on vaping products would increase their costs, potentially pricing their offerings out of the competitive range for consumers who might turn to larger online retailers or unregulated markets seeking lower prices. This financial strain could lead to the closures of these small businesses, resulting in job losses and diminished economic activity in local areas.
Additionally, these businesses often play a crucial role in educating consumers about safer vaping practices and offering products that help smokers transition away from traditional cigarettes. By compromising the sustainability of small vaping businesses, the tax could inadvertently weaken the support network available to individuals seeking to quit smoking, further complicating public health goals.
