The Vape Under Fire: E-liquids Taxation, the New Fiscal Reality

The Vape Under Fire: E-liquids Taxation, the New Fiscal Reality

Between November 8 and 9, 2024, the French National Assembly adopted an amendment that could change the daily lives of many vapers in France. Proposed by Charles de Courson (LIOT) and supported by a sub-amendment from Claire Marais-Breuil and Christine Loir (RN), this amendment establishes a tax on e-liquids. The bottles that delight vaping enthusiasts with their exotic fruit or pastry flavors could now cost an additional €0.05 to €0.15 per milliliter.

The idea seems simple: tax e-liquids to increase fiscal revenue and reduce the appeal of vaping, particularly for younger people. But this text, technical as it may be, raises fundamental questions about vaping, its role in tobacco harm reduction, and the economic repercussions of such political decisions.

Why Tax E-liquids? A Double-edged Equation

Officially, this measure aims to protect public health. The lawmakers behind this amendment argue that taxing e-liquids would discourage young people and non-smokers from taking up vaping. These sweet and playful flavors often attract those who might not have touched a traditional cigarette. By adding an extra cost, legislators hope to limit this gateway effect.

However, this justification feels recycled. Tobacco taxation relied on the same arguments… yet, in reality, it never truly curbed smoking. Why repeat the same approach with vaping, widely seen as a less harmful alternative to smoking?

Behind this amendment lies a less openly acknowledged reality: the state is looking to fill its coffers. Vaping is a booming market, and every milliliter of liquid purchased represents an opportunity to generate tax revenue. An industry in full expansion, with millions of regular consumers, naturally becomes a prime target for additional taxation.

An Invisible but Impactful Cost

Let’s take a concrete example to measure the impact of this taxation on e-liquids:

• A standard 10 ml bottle, often sold around €5, could now cost up to €1.50 more.
• For regular vapers consuming 50 ml bottles, the increase could reach €7.50 per bottle.

At first glance, these amounts seem modest. But for daily users, the bill quickly adds up over the months. Where vaping once presented itself as a more economical alternative to smoking, it could lose that advantage over time.

Heavy vapers are particularly affected. This taxation risks disproportionately penalizing low-income individuals who turned to vaping to escape the prohibitive costs of smoking.

The Amendment and Its Political Implications

This amendment transcends political divisions. Proposed by Charles de Courson and supported by RN deputies Claire Marais-Breuil and Christine Loir, it demonstrates that taxing e-liquids is a consensus measure for certain lawmakers.

By reinforcing this measure through a sub-amendment, these deputies marked a shift in the political discourse around vaping: it is no longer seen solely as a harm reduction tool but also as a commercial product to be strictly regulated, if not treated like tobacco.

Small Business Owners on the Front Line

This new tax doesn’t just concern vapers: it’s likely to have a direct impact on specialized shops. These small businesses, often run by enthusiasts, could face declining foot traffic.

Faced with rising prices, consumers might seek cheaper alternatives. This includes buying online from foreign suppliers (less subject to this tax) or, worse, turning to the black market. The latter, already active for certain vaping products, could expand further.

For French shops, this competition could be fatal, especially in an economic context where small businesses are already struggling to survive against online retail giants.

Vaping: Between Harm Reduction and Consumer Product

One of the paradoxes of this taxation is that it targets a product widely seen as a harm reduction tool. Studies have shown that vaping is less harmful than smoking and helps many smokers quit traditional cigarettes.

By increasing its cost, this tax could hinder this transition. In some cases, it might even push smokers back toward traditional tobacco products, which are far more dangerous.

Moreover, the lack of distinction between nicotine and nicotine-free liquids in this taxation raises questions. Why not tax higher-nicotine liquids more while sparing those without nicotine? A more nuanced approach could have mitigated the unintended consequences of this measure.

What’s Next?

Faced with this new reality, vapers and shop owners will need to adapt. But this adaptation won’t be without consequences:

• For consumers, it means rethinking their consumption or turning to more economical formats (like DIY liquids, which may also be affected).
• For shop owners, it will require extra effort to retain customers who might be tempted by cheaper alternatives.
• For lawmakers, it will be an opportunity to monitor the real impact of this tax: does it effectively reduce the appeal of vaping, or does it create more problems than it solves?

Conclusion: A Fiscal Cloud in an Already Gray Sky

The taxation of e-liquids between €0.05 and €0.15 per milliliter marks a turning point for the vaping industry in France. What was once a dynamic sector synonymous with innovation and a tobacco alternative could now be stifled by questionable fiscal decisions.

While protecting young people is a priority, it should not come at the expense of the millions of smokers who use vaping to quit smoking. A more balanced approach, considering the specifics of vaping and its role in public health, would be a wiser path forward.

Until then, vapers and shop owners will need to navigate these new fiscal waters… or clouds, to stay on theme.