South Africa to Impose First Sin Tax on E-Cigarette Products Starting June 1

Today, on May 20, it was reported that South Africa will impose its first sin tax on e-cigarette products starting June 1.

Asanda Gcoyi, CEO of the South African E-Cigarette Products Association (VPASA), stated that a tax of 2.90 Rand per milliliter (0.15 cents) will be levied on e-liquid starting June 1, which could potentially double the price of products in some cases.

According to News24, a 100-milliliter bottle of e-liquid will incur a tax of 290 Rand (15 USD), with a cost of 200 Rand, meaning if all taxes are passed on to consumers, the price will rise to 490 Rand.

Gcoyi mentioned that the e-cigarette industry was not surprised by the tax decision, as it has been discussed for several years.

“Perhaps the rate is not ideal,” she added. “From our perspective, R2.90/ml as an entry-level rate is too high.”

Gcoyi stated that VPASA expects a 26% decrease in demand for e-liquid after the excise tax is implemented, which will impact businesses and employment.

VPASA estimates that up to 2,250 jobs could be lost by the end of the year. She believes people will revert to smoking relatively cheaper tobacco products.