On Thursday, Labour’s new vape tax came into effect. Vaping Products Duty charges £2.20 per 10ml of vape liquid. Because VAT is charged on top of the duty, the real cost at the till is £2.64. In practice, an average £3.00 bottle of 10ml liquid will now cost £5.64, an 88% price hike.
VPZ, the UK’s largest vape retailer, surveyed 2,640 of its customers ahead of the tax coming into force and found that 63% say it will be harder for them to stay off cigarettes and tobacco, 21% say they may return to smoking, and 34% say they will look for “cheaper alternatives”, which in practice is likely to mean illicit vapes, cigarettes or tobacco.
VPZ’s own prices show the scale of the change. Its standard 10ml liquid, which cost £4.49 before the tax, now costs £7.13, a 59% increase. Its standard 100ml liquid has risen from £16.99 to £43.39, a 155% increase.
E-Cigarette Direct, one of the UK’s largest online retailers of vapes also surveyed 2,068 of its customers and found that 28% said that they would not have switched from smoking to vaping if the tax already existed, with 1 in 6 saying they are now more likely to purchase illegal products with the tax in place.
The tax arrives at a time when illicit cigarette and tobacco sales are increasing and becoming visible on our high streets. These are easy to purchase from some corner shops and cost around £5 for 20 cigarettes or £7 for 50g of tobacco. That is roughly 80% cheaper than the legal equivalent.
This tax will push more people towards illicit cigarettes and tobacco, adding to the burden on public services while sending more money to the black market. That runs directly against the Prime Minister’s ambition to revitalise our high streets. Action on Smoking and Health (ASH) reports that illicit tobacco already comprises nearly 25% of the tobacco market, with around 2 billion illicit cigarettes smoked every year in the UK.
You can see this in the government’s tobacco duty receipts. The OBR expects them to be around £8 billion in 2025/26, down from £10.2 billion just four years earlier in 2021/22. Over the same period, the percentage of adults who smoke has barely shifted, staying at around 13% according to ASH’s Smokefree GB survey.
The government expects the vape tax to raise around £135 million in 2026/27. But the social and economic costs could be far greater. Smoking-related illnesses already cost the NHS and social care in England around £3 billion a year. Around 6 million adults in the UK vape, so even a small share of them going back to cigarettes would be costly.
And let’s not forget that vaping is far less harmful than smoking. The Royal College of Physicians estimated that the long-term harm from vaping is unlikely to exceed 5% of the harm from smoking, a conclusion echoed by Public Health England’s estimate that vaping is around 95% less harmful, making it roughly 20 times safer than smoking. A 2022 review commissioned by the government reaffirmed this position.
In July 2026, the NHS quietly changed the advice on its website. Since April 2019, it had said that vapes “are far less harmful than cigarettes”. It now says they are “likely to be far less harmful than cigarettes”, introducing doubt where there was none. The change comes at a time when 54% of adults already falsely believe that vaping is more harmful than smoking, according to surveying conducted by ASH.
James Murray previously slipped up by stating that “the new regulations and taxes plan to treat vapes the same as cigarettes”, and that “the new measures will help to get illicit vapes off high streets.” He’s oblivious to the facts, and the opposite will happen.
ASH found that 2.7 million people used a vape to stop smoking in the five years to 2024. Analysis by Cebr estimated that smokers who switched to vaping saved the NHS £322 million in 2019 alone, 2.5 times what this tax will raise in 2026/27, seven years after this analysis was conducted.
If you believe in evidence-based policymaking, this tax must be opposed.
* Rees Southern is a member of Sheffield Liberal Democrats.
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15 Comments
A few facts before the few remaining nonconformist radical little blue ribbon temperance Liberals decide to leave this party. I, for one, dislike having vape blown at the world as I walk down the street….. and see school kids going into tacky vape shops.
• Lung Health: Vaping exposes the lungs to chemicals like formaldehyde, acrolein, and metal particles from the device coil, which can cause airway irritation, coughing, and inflammation. Long-term respiratory effects are still unknown because these devices are relatively new.
• Nicotine Addiction: Most vapes contain nicotine, which is highly addictive. It can harm adolescent brain development up to age 25, affecting attention, learning, and mood control.
• Heart and Circulation: Nicotine and other aerosol components can raise your heart rate and blood pressure, increasing strain on the cardiovascular system.
• Short-Term Side Effects: New users often experience throat and mouth irritation, headaches, a dry cough, or feeling sick.
There’s a difference between Liberalism which seeks to enhance humanity and libertarianism which enslaves people to exploitation.
I notice that no mention of the large numbers of non-smokers – especially young people -taking up vaping appears anywhere in this article. While vaping is less bad for people than smoking cigarettes, it is still not something we would wish to encourage non-smokers to engage in.
Hi David, I’d like to respond to each of your points.
On formaldehyde and acrolein, the levels of these chemicals are negligible to zero unless a coil is burnt. On longer-term effects, we now have studies going back roughly 20 years, and the Royal College of Physicians study I cite specifically looked at longer-term effects and concluded that the long-term health risks were around 5% of those of smoking. On nicotine and brain development in under-25s, I’m not advocating for these devices to be used by under-18s, but adults should have a harm-reduction option that isn’t treated and taxed the same as cigarettes. Alcohol also affects brain development in under-25s, yet I don’t see you advocating for raising the drinking age to 25. On heart and circulation, the combustion involved in smoking places greater strain on the cardiovascular system than vaping does. Again, this is about having a harm-reduction option, and alcohol also raises heart rate and blood pressure too. On short-term side effects, these are anecdotal, and vapes are intended as a tool to quit smoking, which is far more dangerous and whose side effects are far worse by comparison.
On your point about liberalism versus libertarianism, it’s strange that you raised this, given that I made a conscious effort to keep the article fact-based. The problem with your definition of liberalism is that if you extended the same logic of “exploitation” across all aspects of life and society, you would end up severely restricting people’s civil and economic liberties, which are also fundamental to liberalism. It would look like banning alcohol, banning fast food and sugary foods, requiring employers to pay their employee the monetary value they created, as to not be “enslaved by exploitation”, this does not sound very liberal to me. Liberalism is also about being evidence-based, and the evidence is clear: this tax will push more people back to smoking, it will cost the NHS more than it raises, and all the available evidence supports the conclusion that vaping is around 95% less harmful than smoking.
Hi Jana, I broadly agree with your comment. I don’t think we should be encouraging people, particularly young people and non-smokers, to take up vaping. However, this tax treats vapes and cigarettes as the same product, which they are not. One is around 20 times more dangerous than the other. When I see a young person vaping, I always think, “thank goodness they’re not smoking a cigarette,” because if vapes weren’t around, that same young person would likely be smoking instead.
With regard to evidence-based policy making, I’m not sure we should treat surveys by vested interests as “evidence”. The tax exists now, so in a few years we should have real evidence available as to it’s effect.
I do know smokers who have used vapes successfully to give up smoking when all other attempts failed.
The problem with effective sin taxes that raise a lot of money is that the Government gets addicted to the tax income. This partially replaces lost tobacco tax income, just as the Goverment needs the proposed mileage-based tax on electric vehicles to replace lost fuel tax income, because fuel taxes succesfully make EVs much more financially attractive.
@David Raw
“A few facts before the few remaining nonconformist radical little blue ribbon temperance Liberals decide to leave this party. I, for one, dislike having vape blown at the world as I walk down the street….. and see school kids going into tacky vape shops”
‘nonconformist radical’ – are you referring to me?
I’ve never smoked anything – ciggies, weed, vapes or anything else – in my life and I’ve no intention of starting now.
@ Nonconformistradical Alas, No. I refer to the countless nonconformist radicals who were the backbone of the Liberal Party in its glory days, some of whom were still around when I joined the Liberals in West Yorkshire as a teenager back in 1961. At the time it was a radical party led by an inspiring Leader (name of Grimond) – who came from far away from ‘Middle England’………. Indeed he was invited to meet President J.F. Kennedy in the White House.
My Great Uncle George Townsend (Leader of Bradford Road Methodist Church choir) enrolled me in the Band of Hope as kid. He gave me a teetotaller blue ribbon which I’ve still got and taught me to sing, “Hail Smiling Morn”.
@Nick Baird: Since when was ASH a “vested interest”? And vested in what?
Hi Nick, as Alex points out, ASH is not a vested interest. Nor are the other organisations mentioned in my article, including the Royal College of Physicians, Cebr and Public Health England. The two companies mentioned at the top of my article simply surveyed their customers on how their habits might change because of the tax, nothing to do with the health effects of vaping.
As for the government plugging gaps left by falling tobacco duty receipts, tobacco duty revenues have fallen by £2 billion over the past five years, while smoking rates have barely budged. This vape tax will raise around £135 million in 2026/27, barely scratching the surface of the duty lost to black-market tobacco sales, meanwhile smokers switching to vaping saved the NHS £322 million in 2019 alone, and this was 7 years ago. On top of that, it has the potential to cause real harm, given that smoking is around 20 times more dangerous than vaping, yet 54% of the public believe vaping is more harmful than smoking.
Hi David. Further to my earlier response, I forwarded your concerns to someone who has worked with tobacco harm reduction organisations. This was their response:
All David Raw’s concerns have been cleverly fabricated over the years by vested interest anti-nicotine organisations. Hardly surprising when the amount of funding spent to mislead the public is $2bn so far and counting.
The device coil misinformation is from an experiment done in 2009 where the coil was super heated to destruction and the vapour then measured to produce a scare story. More responsible research has since been done hundreds of times to properly assess what aerosols are emitted by vaping ragulated products. But the myth still persists. There is a BSI standard for vaping emissions and product notifications to the Medicines and Health Care products Regulatory Agency (MHRA) ensure vapes do not emit those compounds.
Nicotine does not harm adolescent brain development up to age 25 unless you are a rat. The studies were performed on rodents who were susceptible to disease and bombarded with huge amounts of nicotine to produce the intended result. No studies have ever been done on humans because it would be unethical.
Nicotine and other aerosol components can raise your heart rate and blood pressure just the same as drinking coffee, watching sport on TV, or having sex do. It is short-lived and returns to normal in a short space of time. Makes a great headline though.
New users will probably be comfortable with mouth irritation or slight coughs until they get used to the products. They are, after all, a bit better than lung cancer, heart attacks, and COPD.
There is a stable and constant demand for nicotine use. This has been true for the past 12,300 years at least according to archaeologists. Anyone who believes they can eradicate nicotine use is living in cloud cuckoo land. 20% of the world’s population currently uses it. So, the optimal public health approach “to enhance humanity” would be to make sure people are using the safest possible forms of nicotine delivery. Vaping is at least 95% less harmful than combustible tobacco and pouches around 99% less harmful. The only exploitation happening is from people who are scaremongering to ensure they keep their grants, prestige, and power by using every mendacious means available to stop smokers switching to overwhelmingly and incontrovertibly less harmful products.
@Alex @Rees – I was referring to the quoted surveys by VPZ and E-Cigarette Direct, who have a vested interest in selling vapes and are effectively claiming that the vape tax will result in fewer people giving up smoking.
Let’s see if that’s true in a few years time.
Well said Rees. I’ve seen no drop off in youngsters vaping obviously due to old school proxy sales. Far better to vape than to smoke , this tax will just make eBay & boot fairs an even more popular place to purchase these items..
I’m surprised at the support for an article which seems to praise companies that seek to turn our children into addicts.. Does the author really believe that flavours like ‘bubblegum’, ‘cherry cola’, ‘pink lemonade’ etc. are not almost exclusively targeted at children? However from the article, one might almost believe that these companies are benevolent entities..
The scourge of ‘teenage’ smoking fell drastically post-2000. That decline was triggered by a coordinated wave of public health strategies, including massive tax hikes on tobacco products, stricter enforcement of age-of-sale laws, bans on cigarette advertising, and highly visible youth-focused anti-smoking campaigns.. ‘Coincidently’ this was when vapes first appeared.
Vapes contain liquid nicotine, which is the exact same addictive chemical found in traditional tobacco cigarettes, and many vapes contain as much nicotine as an entire pack of cigarettes.
As with most addictive substances your brain and body adapt to the nicotine, making you need more and more of it just to feel normal.
THAT is the same “Get ’em hooked young!” mindset used by the tobacco companies..
Hardly ‘benevolence’
Not all vapes contain nicotine. What I really don’t understand is the decision to tax all vapes the same, whether or not they contain nicotine. Also it isn’t the nicotine that’s harmful in traditional tobacco products (aside from its addictive property), it’s the tar etc. Vape is considerably less harmful than tobacco (not saying it isn’t harmful). Tobacco ≠ Vape. So there is absolutely no sense in a tax regime that treats them the same.
And as for punitive taxes on nicotine-free vapes — might as well do the same for sweets (i.e. a massive sugar-tax hike).
Could Alex please tell us what J.S. Mill would make of freedom to damage your own health (to the detriment and cost to the NHS) and freedom to litter the streets afterwards ?
and ……. private profit making dentists no doubt would certainly oppose taxing sweets.