Sales of vaping products have bounced back from an immediate dip after the “massive disruption” of the disposable vape ban. But the sector should now be preparing for a fresh round of change in the face of duty being imposed on the products.
So says Tom Power senior national account manager of Phoenix 2 Retail, a sponsor at the recent On The Road with Forecourt Trader hosted by Park Garage Group event.
But he believes that the impact of duty being imposed from October 1, 2026 – adding 22p for one ml of vape liquid, or £2.20, on top of the existing 20% VAT, on a 10ml big puff device – will have a lesser impact than the disposable ban.
From April 1, 2027, all stock will be required to display a duty stamp. And although retailers will be given a grace period to clear existing stock by April 1, 2027, forecourt operators need to be preparing now, he suggests, to avoid being left with unmarked stock.
With nicotine pouches being exempt from duty under the plans, Power expects that they will continue to grow in popularity.
“The pouch range has grown very steadily over the past few years, and given the fact that there will be no duty on them, sales will stay steady from the consumer if not increase,” predicts Power.
Velo and Nordic, which dominate the nicotine pouch market, are the brands forecourt operators should develop first he suggests, and when an operator has established a strong market for pouches, others should be added such as Fumi, Zyn, and higher strength options such as Killa and Pablo.
Power also foresees that consumers will also react to duty being added by purchasing smaller formats, to reduce their per item spend when on a budget.
“With prices going up, people will make a decision on how comfortable they are to pay the 22p per ml duty, plus VAT,” says Power. “On a 10ml big puff device, already costing £12.99, that is a fairly sizeable increase. And so some people may look instead to buy a smaller 2ml device because of the pricepoint, or look to oral nicotine to avoid duty,” he adds.
Industry will be able to take learnings from what happens in Ireland, says Power, with levies on vaping fluids introduced there last month. The intention is to reduce youth vaping, as part of a broader plan to introduce more restrictions on sales, flavours and advertising.
“With Ireland just putting duty on, we will probably get some good insights over the next weeks and months, and we will watch closely to see what happens,” says Powers.
He adds: “There is still plenty of time for everyone to prepare with vape duty starting October 2026, but it is worth having a conversation with your supplier. We are already talking to the biggest companies. But it should be fairly seamless when vape duty starts because of the grace period until April 2027.
Since the disposable vape ban, the two big growth areas are pods and big puff devices, with key players including Lost Mary, SKE and IVG, says Power. He adds that with disposable vapes previously accounting for 80% of the market’s value, the ban had caused a lot of disruption. “We essentially had to pull everything out and start again,” he says.
And so he predicts that the introduction of duty on vaping products will have a much smaller effect on the shape of the market. “Yes, there will be an impact with duty next year. But the disruption will not be as big as the ban,” he says.
