Jeremy Hunt announced a new tax on vapes as the government moved to crack down on smoking in the spring Budget.
The chancellor introduced a levy on the smoking alternatives in a bid to make them unaffordable for children. He said the move would take effect from October 2026.
It comes after the government in November last year made plans for a “smoke-free” generation by banning tobacco products for children turning 14 or younger.
According to pre-Budget reports, the tax would apply to the liquid in vapes, with an additional higher tax for any products that contained more nicotine.
Under current rules, vapes are subject to VAT but not a specific tax like normal cigarettes are.
Officials fear that the relatively cheap cost of vaping means that the products are more accessible for young people as well as non-smokers.
Disposable vapes retail for around £6 while some supermarkets charge up to £13 for a packet of 20 cigarettes.
Disposable vapes retail for around £6 while some supermarkets charge up to £13 for a packet of 20 cigarettes
(PA Wire)
The government first said it was considering a vaping levy at November’s King’s Speech, citing a “significant differential” with tax on tobacco.
In 2023, a survey conducted by the tobacco control charity Action on Smoking and Health (ASH) found that 3.7 per cent of young people aged 11 to 18 in Great Britain vape regularly.
The International Tobacco Control study (ITC), an international cohort study on smoking and vaping) found that 24 per cent of people aged 16-to-19 years in England reported having vaped in the past 30 days in 2022.
Mr Hunt also announced a one-off increase in tobacco duty.
Taxes on cigarettes and other tobacco products will rise despite having been hiked twice in 2023, meaning they will become more expensive.
After last years’ second rise in tobacco duty, the average price of a packet of 20 cigarettes grew to £14.39 – up by £1.55. It is expected that the new rate will see that average grow to £16, a further increase of £1.61.
First announcing the move last year, prime minister Rishi Sunak said more must be done to “try and stop teenagers taking up cigarettes in the first place” as he set out plans to introduce a new law banning tobacco sales to anybody born on or after January 1 2009 in a plan backed by the Labour Party.
Downing Street said it expected the plan to result in up to 1.7 million fewer people smoking by 2075.