Key Points:
·Tax plan: Guernsey plans to levy a £2 (approximately $2.60) tax on every 10 milliliters of e-liquid, with the 2026 budget set to be announced on October 7.
·Reactions: Some retailers are concerned about the impact on the industry, leading consumers to switch to cigarettes or unregulated online products; while others believe the effect may not be significant, as cigarette taxes could increase concurrently.
·Background: The UK plans to introduce a £2.20 (approximately $2.90) tax on every 10 milliliters of e-liquid starting in October 2026, and Jersey also intends to include a similar tax in its 2026 budget; Guernsey plans to introduce a 5% goods and services tax in 2024, which is currently under review.
According to a report by the BBC on August 20, one of the largest e-cigarette retailers in Guernsey, United Kingdom expressed "deep concern" over the plans to tax e-liquids in the 2026 budget.
Tina Dorfner, owner of the "Vape Bar" in St. Petersburg, said that the proposal from the Policy and Resources Committee (P&R) could have a "massive impact on the industry.
Retailers have stated that the P&R plan proposes charging a tax of £2 (approximately $2.60) for every 10 milliliters of e-liquid, but the final details have not been announced yet. P&R has been contacted for feedback at the moment.
In the UK, the government has decided to impose a tax of £2.20 (approximately $2.90) per every 10 milliliters of e-liquid starting from October 2026. The government of Jersey has also stated its intention to include a tax plan for e-liquid in their budget for 2026.
The town shop owner Peter Bierley has a more relaxed attitude towards the proposed e-liquid tax plan.
He said: "Consumers will have to bear this tax. This may discourage some people from using e-cigarettes. However, I don't believe it will lead people to start smoking traditional cigarettes again, as we have learned that cigarette taxes will also increase by a similar margin. Therefore, I hope the impact will not be too significant, but anything is possible.
Sophie Dorfner, who is also involved in running the "e-cigarette bar," holds a different opinion: "This will ultimately lead to people starting to smoke again because they won't be able to afford e-cigarettes due to the high prices.
E-cigarette industry professionals unanimously believe that this matter is still in the early stages, and P&R has not yet submitted a specific plan.
However, the island's retailers have been invited to meet with government officials regarding the proposed plans.
Sophie Dovna warned that taxing e-cigarette products could have an impact on the local market.
She said, "I do believe that this will lead many people to buy unregulated products online. They do not know what these products contain, nor do they understand what they are buying; many unregulated products contain illegal tetrahydrocannabinol (THC). People will ultimately purchase these products because of their cheap prices, without understanding the ingredients, and in the long run, this will lead to more health issues.
Tina Dovner stated that she will not make a full assessment until the specific plans are revealed, but she acknowledged feeling concerned about the proposals.
She said, "Many people are concerned that this may lead them to give up vaping e-cigarettes and revert back to smoking traditional cigarettes, as once all these policies are implemented, along with the Goods and Services Tax (GST) being levied, e-cigarettes will become a much more expensive product.
In 2024, the government of Guernsey has agreed to introduce a 5% goods and services tax, while lowering the income tax rate for individuals earning less than £30,000 (approximately $40,000) per year, and reforming the social security contribution system.
However, these plans are currently in the review stage, meanwhile, P&R member Charles Parkinson is studying the island's corporate tax system.
P&R is scheduled to release the 2026 budget proposal on October 7th and hold a debate on November 4th.
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