In a recent development, Ontario's vaping community is gearing up for significant changes as the provincial government plans to double the existing federal tax on e-liquids and prefilled vaping products. This move, set to take effect soon, has raised concerns among vapers about increased costs and potential consequences for the industry. In this blog, we aim to provide you with comprehensive information about the upcoming tax changes and their potential impact on Ontario vapers.

The Current Tax Structure:

Since October 2022, a federal tax has been in place across Canada, applying to all bottled e-liquids and prefilled vaping products, irrespective of nicotine content. The existing federal tax charges users $1 per two milliliters (or portion thereof) for the first 10 mL of e-liquid in a sealed container. Beyond the initial 10 mL, an additional $1 is levied per 10 mL of liquid. Presently, Canadian vapers pay an extra $7 in taxes on a standard 30 mL bottle of vape juice.

The Proposed Changes for Ontario:

Under the new provincial tax "partnership," Ontario vapers will face a doubling of these taxes. This means that instead of the current $7 extra in taxes on a 30 mL bottle of vape juice, consumers in Ontario will be required to pay a substantial $14. The tax on prefilled pods, which currently stands at $1 per pod at the federal level, will also double to $2 per pod in Ontario.

Government Justification and Criticisms:

The Ontario government has justified these tax hikes as a health measure, aiming to combat youth vaping and prevent a perceived link to smoking. Citing research suggesting a connection between youth vaping and smoking initiation, the government asserts that these tax increases will act as a deterrent. However, critics argue that historical research demonstrates a counterintuitive trend – increased taxes on vaping products often result in higher cigarette sales.

Impact on Vaping Community:

Vaping advocates, such as Maria Papaioannoy from the Canadian vaping advocacy group Rights4Vapers, express concerns over the disproportionate burden placed on Ontario vapers. The argument here is that these tax hikes might hinder the goal of providing an affordable and effective alternative to smoking. Instead of encouraging smokers to switch to vaping, the increased costs may inadvertently drive consumers back to traditional cigarettes.

As Ontario prepares to implement these substantial tax changes on vaping products, it's crucial for consumers to be informed about the potential consequences. While the government's intent to address youth vaping is understandable, historical evidence raises questions about the effectiveness of such measures. Ontario vapers are left grappling with the prospect of double taxation and the potential impact on their choice to transition away from traditional smoking. Stay informed, stay engaged, and be aware of the changes shaping the vaping landscape in Ontario.