The vape tax would be implemented in October 2026

In his budget speech on Wednesday (March 6), Hunt said that the tax would be implemented in October 2026. And, he mentions that the government would consult on the design of the tax.

Vapes may represent an increasingly important revenue stream for BAT amid increasingly stringent tobacco regulations and declining smoking rates. According to Jefferies analyst Owen Bennett, the tax will make it difficult for smaller businesses to compete. But, it could benefit large tobacco companies such as British American Tobacco.

"BAT, especially given its highly profitable broader cigarette business, can afford to swallow the tax and not adjust prices."

This may result in small companies not being able to survive.

A spokesman for BAT's UK division added, "We encourage the government to implement a vape tax sooner than October 2026 to tackle the illicit market that is already prolific." The company supports a "low GST tax" on nicotine liquids in vapes. But, it believes that taxes related to nicotine content will be difficult to enforce.

UK government has been forced to consider tougher controls to vapes. Because vape use surges among non-smokers and youth. Most vapes will be subject to the standard 20% VAT, but no additional charges will be imposed.

Maggie Rae, chair of the Epidemiology and Public Health Unit at the Royal Society of Medicine, says any tax would have to be carefully considered to ensure it did not undermine efforts to encourage smokers to quit.

News by VPFIT, leading vape company from China.

2024.03

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