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New Excise Tax for Vaping Products

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Excise Vape Tax in Canada

The Government of Canada made the decision to add a federal excise tax on vaping products. This tax applies to all vaping products produced in Canada or imported into Canada for use in a vaping device. The excise tax does not affect the current federal and provincial sales taxes on vape products sold which will still be applicable. The excise tax will be an additional tax amount before the application of all existing GST/HST/PST taxes on vape products sold in Canada.

The new excise tax came into effect on October 1, 2022, requiring Canadian manufacturers and importers to license all vape products and ingredients with the Canada Revenue Agency. All vape products coming into the country must get stamped and indicate that the duty has been paid.

Beginning January 1, 2023, all vaping products sold in Canadian vape stores must come with excise stamps. Vaping products with un-stamped packaging will be illegal to purchase. As we transition towards stamped products, Canadian vapers will be able to purchase un-stamped POP Vapor products till the end of 2022 (while quantities last). Since the new excise tax is a federal tax item, every province still has the option to collect additional excise tax on vaping products.

Calculating the Taxes

Excise taxes will be paid by the product licensee before making the product available to consumers. These taxes will impact the entire value chain, increasing the MSRP of all vape products sold in Canada.

According to Schedule 8 of the Excise Act, excise taxes will be as follows:

  • $1 per 2mL or fraction thereof, for the first 10ml of vaping substance in the device, or immediate container.
  • $1 per 10mL or fraction therefore, for e-liquid after the first 10mL.

    What this means?

    For a vape device that contains 15ml of e-liquid, there will be an excise tax of $6 ($5 for the first 10 ml and $1 for the remainder)

    The table below shows the excise tax amounts based on the e-liquid held in a vape pack:

    E-Liquid

    Excise Tax

    6 mL

    $3.00

    8 mL

    $4.00

    10 mL

    $5.00

    12 mL

    $6.00

    14 mL

    $6.00

    20 mL

    $6.00

    Β 

    This tax is applicable on all products containing e-liquid or vape juice such as disposable vapes, vape pods, vape liquids and DIY vape products. The tax is not applicable to tanks, replacement coils, accessories and hardware.

    The new product prices will be calculated with the current product price, excise tax, and any other applicable taxes. Vaping still remains more cost efficient than smoking, however, the new excise tax will substantially raise the cost of a health conscious choice.

    Want to know more about the health benefits of vaping over the usage of combustible nicotine products such as cigarettes? Check out the link below:

    https://www.canada.ca/en/health-canada/services/smoking-tobacco/vaping/smokers.html

    Beginning January 1st 2023, untaxed vaping products will be unavailable for purchase. Tax free product pricing is not guaranteed till this day however, as the availability of un-stamped vape products will depend on the remaining inventory of untaxed vape products. We hope to bring you the best tasting and the most cost efficient vape products after the implementation of the new excise tax. For now, our focus is on helping Canadian vapers take advantage of the untaxed pricing for as long as possible. See our pre-excise-price bundle offers here.

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