New tax on vaping

UK Gov reportedly considering a levy on vape liquids

Jeremy Hunt in parliament delivering the Autumn Budget 2023.
The UK Government is reportedly considering introducing a tax on vaping liquids in its Spring Budget 2024.                  Photo credit:UK Parliament/Jessica Taylor

THE UK Government could be set to introduce a new tax on vape liquids in its Spring Budget 2024.

First reported in The Times, chancellor of the exchequer Jeremy Hunt is considering a levy on the liquids in vape devices, with a higher rate on those products that contain more nicotine.

The chancellor is also, reportedly, considering a rise to tobacco duty once again, following a 10% above the line rise in the Autumn Budget 2023.

It is thought any new potential tax, along with the rise in tobacco duty, could generate as much as £500million per year.

Hunt is set to deliver the UK Spring Budget on 6 March.

John Dunne, director general at the UK Vaping Industry Association (UKVIA), has slammed any potential new levy on vape liquids, dubbing it an attack on those trying to quit smoking.

He said: “It makes absolutely no sense to make it more difficult for adults to stop smoking by penalising those who choose a safer and healthier option in vaping.

“Smoking kills 250 people every day in the UK and according to Action on Smoking and Health costs the UK £17bn a year.

“A Centre for Economics and Business Research (Cebr) report in 2022 found that smokers switching to vaping saved the NHS £322m, a figure that was estimated to more than double if 50% of UK smokers made the switch to vapes.

“Surely we should be doing everything we can to help smokers escape a habit that kills so many. Increasing taxes on vaping will make vapes less accessible for the most disadvantaged in society who have the highest smoking rates and are most in need of an effective tool to quit.”

This news follows on from the UKVIA presenting a proposed licensing framework for vape devices to Westminster, in a bid to cut out youth vape sales and tackle the illicit trade market simultaneously.

This move from the UKVIA follows on from the Vape Club‘s 2024 report which highlighted the scale of UK’s illegal vape trade market.

In the UKVIA’s proposals, the industry body has laid out eligibility for obtaining a licence to sell the devices across brick and mortar premises as well as online stores.

The UKVIA has estimated the proposals, if put in place, could help generate more than £50million annually.

Similar to regulations already in place for tobacco and alcohol products, the UKVIA has called that stores who have already demonstrated their responsibility to the products should be allowed to sell the devices.

The firm has said that businesses whose primary function is not for retail should not be allowed to apply for the licence. This would include hairdressers, taxi drivers or event venues both long-term and short-term ones.

Interestingly, the UKVIA has also called for some hospitality venues such as pubs, bars and clubs to be able to apply for the licence, claiming they should ” they are hotspots for smoking and present a unique opportunity to help adults move away from cigarettes through vaping”.

Speaking on the launch of the new proposals, Dunne said: “This is an incredibly important and timely piece of work, and one the government should pay careful consideration to if it is serious about its commitment to tackling youth vaping while also working towards a smoke-free future and giving adults the best chance of quitting.

“Action must be taken to put an end to underage and illicit vape sales but a ban on disposables will turbo-charge the black market and make illegal vapes more readily accessible to young people, while also outlawing a product which has successfully helped adult smokers move away from and completely stay off cigarettes.

“Instead, the government must bring the hammer down on rogue traders by ensuring existing laws can be effectively and proactively enforced – this is the blueprint to make that happen.”