New Provincial Vape Tax in Alberta, Manitoba, New Brunswick, Yukon, and Prince Edward Island

In Canada, the taxation landscape for vaping products has evolved significantly over recent years, with both federal and provincial governments implementing excise duties to regulate and tax these products.

Starting April 1st, 2025, a new Provincial Excise Vape Tax will be implemented in Alberta, Manitoba, New Brunswick, Yukon, and Prince Edward Island.

HOW THE NEW TAX AFFECTS PRICING:

This new provincial tax will significantly increase the cost of vaping products in these regions. The RCMP will enforce this tax starting October 1, 2024, making it illegal to buy vape products without the provincial excise tax stamp in Ontario, Quebec, Nunavut, and the Northwest Territories.

What This Means for Consumers:

For example, an S-compatible Pod Pack (3x2ml) will now be subject to a total of $6.72 in vape taxes ($3.36 Federal Excise Tax + $3.36 Provincial Excise Tax).

Vape prices are expected to increase significantly, making it more costly for consumers in these provinces. It's advisable to stock up on products before the price hike on October 1, 2024.

Impact on the Vaping Community:

The tax increase comes after the Federal Government's recent plans to introduce a country-wide flavor ban, which was ultimately canceled after a petition gained significant support. However, this new tax might discourage vaping, potentially pushing some former smokers back to cigarettes or leading to the emergence of a black market.

CANADA’S VAPE TAX: MORE ON VAPE TAXES

Federal Introduction:

In April 2021, the federal government announced its intention to impose a specific excise tax on vaping liquids, beginning in 2022, and in April 2022 legislation was introduced to put this into effect, with an implementation date of October 1, 2022.

All products that contained a vaping e-liquid, sold within Canada, were required to be taxed. This included disposable vapes, closed-pods, and e-liquid bottles. Products intended for vaping but sold separately from the vaping substance were not taxed; this included closed-pod devices, vape mods, charging cables, and other accessories.

Provincial Participation:

Initially, the governments of Ontario, Quebec, the Northwest Territories, and Nunavut agreed to join the coordinated framework and formalized their participation by signing the Coordinated Vaping Product Taxation Agreements (CVPTAs). This coordination allowed for an additional vaping duty equal to the federal rate to be applied in these jurisdictions.