UK: Immediate increase in tobacco taxes and tax on vaping in 2026

UK Chancellor Rachel Reeves announced a new tax on vaping products and an increase in tobacco tax in her Autumn Budget. She confirmed that the government would introduce a “flat tax” on all vaping liquids from October 2026. The government is also maintaining the tobacco tax index mechanism, which increases taxes by the Retail Price Index (RPI) plus 2% at each annual Budget session.

The government also announced a further increase in taxes on rolling tobacco in order to reduce the price gap between this product and manufactured cigarettes.

These measures are welcomed by anti-smoking associations, notably Action on Smoking and Health.[1] which states that an excise tax on vaping products will limit access to cheap products for younger people by reducing their accessibility and that it will allow for better control of the vaping product market.

Discouraging youth, non-smokers and non-vapers from starting vaping

The government said the tax on vaping products was aimed at deterring non-smokers and non-users of vaping products, particularly young people, from taking up vaping. A fixed tax of £2.20 per 10ml of e-liquid will apply from 1 October 2026.

The Government has also announced a specific tax increase on tobacco in October 2026 to maintain the price gap between tobacco and vaping products. The price of 100 cigarettes and 50 grams of rolling tobacco will increase by £2.20. Also, as announced in the Autumn Budget 2024, the tax rate on all tobacco products will immediately increase by £2.% in line with inflation and the tax rate on rolling tobacco will increase by a further £10.%.

For ASH, it is necessary to continue to increase tobacco taxes to encourage smokers to quit smoking and reduce the burden of smoking on public finances and ultimately the economy.

In France, a tax on e-liquids is currently under discussion. It plans to introduce a minimum tax of €0.15/mL on liquids. A measure supported by anti-smoking associations to limit the attractiveness of these products to non-smokers and non-vapers (especially young people).

Tighten regulations on vaping products

E-cigarettes have long been subject to favourable regulation in the UK. However, the rapid evolution of the consumption of these products in recent years, particularly among young people, has followed. The latest data shows that 7.2% of young people aged 11 to 17 report using e-cigarettes occasionally or regularly, compared to 4.1% in 2020, an increase of 43% in three years. A recent study in the Lancet showed that in England, one million current vapers did not smoke regularly before and of these, more than half (around 588,000) were aged 18 to 24.[2].

In light of these elements, the government has expressed its wish to significantly restrict the attractiveness of vaping devices. The Tobacco and Vapes bill[3], which provides, among other things, for a ban on the sale of tobacco products to anyone born after 2009 (currently under discussion), also includes provisions regulating vaping products more strictly. These include the introduction of plain packaging, the removal of product displays in points of sale, a reduction in the number of authorised flavours and a ban on puffs.

©Tobacco Free Generation

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[1] Press release, Tax increases on tobacco and vape liquids welcomed by health charity, ASH, published July 27, 2024, accessed October 31, 2024

[2] Generation without tobacco, England: One million current vapers did not smoke regularly, published October 6, 2024, accessed October 31, 2024

[3] Generation without tobacco, United Kingdom: Labor reintroduces ban on tobacco sales to people born after 2009, published on July 27, 2024, consulted on October 31, 2024