Vapes are unquestionably popular, with many who vape saying they are trying to quit or to cut down on cigarettes.
Image: Pexels
All you need to know about the new South African smoking tax
From 1 June, nicotine-substitute solutions, including vaping products, were included in the tax net. Here’s all you need to know.
Vapes are unquestionably popular, with many who vape saying they are trying to quit or to cut down on cigarettes.
Image: Pexels
From 1 June 2023, nicotine-substitute solutions, including vaping products, were included in the tax net with a flat excise duty rate of R2.90/ml
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New tax laws imposed on vaping
Excise duty on vaping tobacco products has been in the pipeline for a while – the tax was first announced in finance minister Enoch Godongwana’s 2022 budget speech.
The South African Revenue Service (SARS) said that the forms which govern Tobacco Product Excise had been amended to account for vaping products.
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Manufacturers were required to apply for and obtain licenses for their manufacturing premises in respect of such products with SARS before 1 June 2023 and will have to submit their first excise duty account by 28 July 2023.
The new tax has been met with widespread condemnation from the vaping industry, arguing that the tax will do more harm than good – pushing consumers to illicit markets – and jumps the gun as legislation governing vaping products in the country are yet to be promulgated.
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Vaping industry concerned with new legislation
Consumer group Vaping Saved My Life (VSML) said that the flat excise duty would likely see e-liquid prices inflate from 5.8% to 217%, depending on the volume and current retail price.
“The tax will be detrimental to those using vaping to stop smoking as well as local small businesses – doing more harm than good,” said VSML co-founder, Kurt Yeo.
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Vaping products are not covered by the Tobacco Products Control Act or the Medicines Act and are largely unregulated.
New legislation to regulate the industry is currently in the pipeline, with the Tobacco Products and Electronic Delivery Systems Control Bill currently being processed.
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‘Vaping is not smoking’
The vaping industry has tried to position itself as “not smoking” and wants to distance itself from harmful tobacco and cigarettes in attempts to avoid these tax laws.
Vaping involves inhaling from a device that vaporizes liquid solutions that may contain nicotine and other substances. According to the UK’s NHS, health experts generally agree that vaping is far less harmful than smoking, but it is not risk-free.
Medical guidelines are that vaping is not recommended for non-smokers and young people as it can carry risks for healthy lungs. However, for smokers, it can be beneficial in helping them quit smoking.
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The long-term effects of vaping on health remain untested, and the Department of Health has argued that the coming tax laws and push to clamp down on the industry are driven by the goal of protecting children from potential harm.
Vaping has gained popularity as an alternative to traditional cigarettes but has also emerged as a trendy habit among younger generations.
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