Vape experts warn new tax could drive consumers towards illegal products

From 1 October, vaping liquid will be subject to a new tax of £2.20 for every 10ml, meaning a potentially huge financial impact depending on how much e-liquid a person uses.

While pre-filled pod users may see relatively modest increases, those using larger volumes of e-liquid could face significantly higher costs.

Experts are now warning that the biggest concern is whether rising prices could encourage some price-conscious consumers to seek out cheaper products from illicit and unregulated markets.

Salman Essap, founder of Vape and Go, explains:

“The new duty is based on the amount of e-liquid you use, so the more liquid you consume, the more tax you will ultimately pay.

“A typical 2ml pod would be subject to 44p in duty, while a 10ml bottle would face £2.20. For someone using larger volumes, the costs increase quickly, as a 50ml bottle would attract £11 in duty before VAT.

“Once VAT is included, that £2.20 duty works out at £2.64 added to the retail price for every 10ml of e-liquid. That means a 50ml bottle could have £13.20 added, while 100ml would attract £26.40 in duty and VAT.

“The duty applies regardless of nicotine strength, so even 0mg nicotine-free liquid will be subject to the tax. It also applies to prefilled pods, shortfills and big-puff products based on the amount of liquid they contain.

“That means heavy users are likely to feel the biggest impact, particularly sub-ohm vapers (users of devices designed to produce much larger amounts of vapour) who regularly buy larger bottles of e-liquid.

“For someone using 50ml a month, the additional cost could amount to £158.40 over a year. For someone using 100ml a month, that rises to £316.80, while a 200ml-a-month user could face an additional £633.60 per year.

“The concern is that if regulated products become significantly more expensive, some consumers may start looking for the cheapest possible alternative.

“Not everyone will turn to the illicit market, but price matters. If illegal products are considerably cheaper, the financial incentive to take that risk becomes greater.

“Consumers should be particularly cautious of products being sold through unofficial channels or at prices that appear too good to be true.”

How much more could your vape liquid cost?
2ml pod: 44p in duty / 53p including VAT
10ml bottle: £2.20 in duty / £2.64 including VAT
50ml bottle: £11 in duty / £13.20 including VAT
100ml of e-liquid: £22 in duty / £26.40 including VAT
VAT is charged on top of the duty.

Vape bestseller, the IVG Nexio Prefilled Pod Kit will increase from the current price of £6.99 up to £10.16 due to its 2ml pre-filled pod and its 8ml refill pod, a total increase of £3.17.

Another bestseller, the Hayati Pro Ultra Plus 25000 will increase by £5.81 due to a 2ml pre-filled pod as well as a 20ml refill, with the pricing increase from £10.99 currently up to £16.80 after the new tax.

Which vapers could be most affected?
Heavy e-liquid users, who could face the largest increases in overall spending.
Sub-ohm vapers, who typically use larger volumes of e-liquid.
Frequent pod users, as smaller price increases accumulate over time.
Price-conscious former disposable users, who may be particularly sensitive to higher prices.
How much could heavy users pay?
The impact of the new duty will depend heavily on how much liquid a person uses:

50ml per month: £13.20 extra per month / £158.40 per year
100ml per month: £26.40 extra per month / £316.80 per year
200ml per month: £52.80 extra per month / £633.60 per year
Warning against cheaper alternatives
Salman adds:

“When prices rise, it is understandable that consumers look for ways to save money. But if a vaping product is dramatically cheaper than comparable products, people should question why.

“There will also be a period where older, pre-tax stock can be sold alongside products affected by the new duty. This means consumers could temporarily see the same product at different prices depending on when the stock was purchased.

“Buying from reputable retailers remains the safest option. The concern is that higher prices could create a greater opportunity for sellers of unregulated products to target consumers looking for a bargain.”