The £2.20 Tax: How UK Vaping Will Change in 2026

The UK government has announced a new tax on vapes, set to begin in October 2026. This measure aims to balance public health priorities with economic incentives, but it’s already sparking concern among vapers and businesses alike. What’s the bottom line for you? Let’s take a closer look.

What Is the New Vape Tax?

From October 2026, a new tax of £2.20 per 10ml of e-liquid will come into effect. This move is designed to deter casual vaping, particularly among minors, while maintaining the financial incentive for smokers to switch to vaping.

To reinforce that balance, the government is also increasing tobacco duty by £2.20 per 100 cigarettes. This step ensures that vaping remains a less expensive and healthier alternative to smoking, but it also means rising costs for vapers and businesses in the industry.

The Industry Impact

We asked Juicy Vapes, one of the UK’s leading websites for vape brands, about the likely effects. Their team anticipates a rush of panic buying before the tax kicks in, followed by a quieter period as vapers adjust to the new prices. Retailers and wholesalers may also feel the pinch, needing to rework their pricing structures to account for the additional costs.

What Does This Mean for Vapers?

If you’re a regular user, the price of a typical 50ml bottle of e-liquid could rise by £11 or more, depending on how brands handle the tax. While the added cost may seem small for occasional vapers, the financial impact over time could make vaping less appealing.

For smokers considering a switch, however, vaping will still remain the cheaper and healthier alternative, just with a slightly higher price tag.

What Does This Mean for Businesses?

Vape retailers and wholesalers face a double-edged sword. On the one hand, the run-up to October 2026 might bring increased sales as customers stock up before the tax is implemented. On the other hand, the post-tax period could lead to reduced demand, particularly among those who stocked up in the run-up to the new tax being implemented.

Navigating these changes will require careful financial planning. Experts like Towerstone Accountants can help small businesses in the vaping industry stay compliant with tax regulations and assist them throughout the transition.

The Bigger Picture

Speaking with Lillian Purge, who represents numerous vaping companies within the digital marketing industry, they noted that the tax could unfairly penalize responsible vapers and smaller businesses. “The vaping industry is already heavily restricted in terms of marketing and advertising, as a result, we expect to see a reduction in digital marketing campaigns, local advertising, research and development, new product launches, and vaping conventions following the implementation of the new tax

If you’re a vaper or a retailer, this is the time to prepare. Stay informed, plan your purchases, and consult with professionals to navigate the financial landscape ahead. 

Future Loopholes

The UK vape tax represents the most significant change in the vaping industry since May 2017, when all products sold to consumers were required to fully comply with the Tobacco Products Directive (TPD). While the new tax law will bring stricter regulations, history suggests the industry may find innovative ways to adapt. After the TPD was introduced, vape companies responded with shortfill e-liquids, which exploited a loophole in the rules and quickly became a dominant product in the UK market.

Similarly, with the upcoming tax, consumers might see the emergence of longfill e-liquids—a product that could serve as a workaround for the new tax regulations. This type of e-liquid, already popular in Greece for bypassing local tax laws, may soon make its way to the UK market as companies look for creative ways to mitigate the impact of the new levy.

What to Do Before the New Tax Rule

With the October 2026 deadline fast approaching, preparation is key. For vapers, it’s worth stocking up on your favourite e-liquids before prices rise but keep an eye out for potential product innovations like longfill e-liquids that might offer cost-saving alternatives which should arrive on the market way before the new tax rule.

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