IBVTA responds to Chancellor’s budget announcement on vape excise
The Independent British Vape Trade Association (IBVTA), the leading independent trade association for the UK vaping industry, acknowledges the change in structure of the excise first mooted by the previous Government. However, it reiterates concerns of unintended consequences.
As part of her first budget, Chancellor Rachel Reeves has announced a flat rate of excise duty on vaping liquids at a rate of £2.20 per ten millilitres, from October 1st 2026.
This would mean the cost of the products used by many thousands of vapers including those on lower incomes, 10ml refill bottles, will increase by £2.20 +VAT and the rate of a 2ml prefilled pod will increase by £0.44+VAT.
The previous Government had announced a tiered structure, meaning a higher rate of excise would have been applied to the products which smokers need most to make a successful switch, and had been warned against by public health academics and organisations, including Smoking on Action and Health (ASH).
The Government has also announced a technical consultation on additional compliance measures which sets out proposals for vaping duty stamps and seeks views on options to limit illicit production of vaping liquids by placing controls on the supply chain of nicotine. The consultation will run until 11th December 2024.
Welcoming the change of policy from the previous government’s tiered proposed structure, IBVTA Chair, Marcus Saxton, said:
“The government has already proposed regulation that will ban single use products, which despite helping many adult smokers access vaping, have via irresponsible retailers been disproportionately accessible to children.
It would seem a little questionable then to increase the cost of vaping, especially given there are still around six million adult smokers for who you’re trying to give every opportunity to make the transition to less harmful products.
There’s also the potential negative effect of an excise on public services utilising vapes within their smoking cessation services. The IBVTA do not believe that any excise tax should be applied to products supplied via these services.
The IBVTA will continue working constructively with HMRC to make sure these proposals are meaningfully enforceable and don’t have unintended consequences.”