New Excise Duty on Vaping Products in Canada: What You Need to Know

New Excise Duty on Vaping Products in Canada: What You Need to Know

New Excise Duty on Vaping Products in Canada: What You Need to Know

On October 1st, 2022, the Canadian federal government implemented an excise tax requiring every e-liquid bottle or pre-filled pod sold in Canada to bear an excise-duty stamp, akin to the stickers seen on tobacco and cannabis products.

Provincial Participation and Tax Rates
When this regulation was established, it allowed provinces to "piggyback" on the federal excise duty, collecting additional excise duty if they opted in. Effective July 1st, 2024, the following provinces and territories will begin collecting excise duty on all vapeable vaping products, including e-liquids, disposables, and pre-filled pods:

- Manitoba
- Ontario
- Quebec
- Northwest Territories
- Nunavut

In addition to this provincial duty, the 2024 Finance budget introduces a 12% increase on the general duty rate. The provincial excise duty rate matches the federal rate, effectively doubling the excise duty in the provinces that have opted in.

Excise Duty Breakdown

Implementation Date
Manufacturers must start adding provincial stamps to products by July 1st, 2024.

Affected Customers
This regulation will affect all customers purchasing e-liquid within Manitoba, Ontario, Quebec, Northwest Territories, or Nunavut. Customers buying from The he Vapor Bar for shipping outside these provinces will not incur additional provincial excise duty taxes.

Importing Products from Outside Canada
The Canada Border Services Agency and the Canadian Revenue Agency have stipulated that products shipped into Canada from abroad must be duty-stamped. Products without the stamp are deemed illegal for sale or import, and customs officials have been confiscating and denying entry to unstamped packages.

Cost Comparison: Vaping vs. Smoking
Despite this new tax, vaping remains significantly cheaper than smoking. A pack-a-day smoker spends approximately $126 on cigarettes per week, while a vaper spends around $40 on e-liquid in the same period.

Affected Products
The new excise duty applies to all vapeable products, including disposable vapes and pre-filled pod systems such as Juul and STLTH. It also affects DIY products like VG, PG, flavoring, and nicotine base at 20mg/mL when sold for vaping purposes. However, it does not impact hardware (non-filled, refillable devices).

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