South Africa Imposes Taxes on Vapes Ahead of Product Regulations

E-liquid is subject to a tax in South Africa, despite in the absence of legislation recognizing and regulating e-cigarettes. The levy becomes operative on June 1.

All e-liquid, whether it is sold in bottles, prefilled pods, or disposable devices, is subject to a tax of 2.90 South African Rand (about $0.15 US) per milliliter. The tax rate on a 60 mL bottle of e-liquid would be R174, or almost $9 US. For many vape items, the tax may result in a price increase for users.

The country's finance minister effectively suggested the same wholesale tax in his 2022 budget statement. It applies to all vape devices, nicotine-free or not.

According to Asanda Gcoyi, CEO of Vapour Products Association South Africa (VPASA), the nation's the vaping business anticipates losing almost 2,000 jobs and a fourth of its revenue. Many individuals will go back to smoking, she told News 24 , and some may locate more affordable vape items on the underground market.

Before the tax's implementation, South African e-liquid producers had to apply to the South African Revenue Service (SARS) for licenses to operate manufacturing and storage facilities. They also had to send the agency their initial payment by July 28. Taxes on imported vape goods will be the responsibility of importers and wholesalers.

In the meanwhile, vaping goods would be included in South Africa's current tobacco control law through the Tobacco Goods and Electronic Nicotine Delivery Systems Control Bill, which has been in the works since 2018. There are currently no rules or legislation in the nation about vaping items, not even one stating the minimum age of purchasing.

The law, which is now being drafted in Parliament, is anticipated to impose smoking bans on vaping and combine cigarettes and e-cigarettes into one category. It might also enact new limitations, such as prohibiting internet sales.

With a population of over 60 million, South Africa boasts the second largest economy in Africa, after only Nigeria's. 25.8% of South Africans over the age of 15 smoke, according to the 2021 Global Adult Tobacco Survey. This high percentage is made possible by the easily accessible, inexpensive black market smokes.