South Africa Public Comment Period on Vape Tax Ends Soon

South Africa’s National Treasury (SANT) says the public comment period on its proposals to impose a specific excise tax on both the non-nicotine and nicotine e-liquids for vaping products will end on Feb. 7, 2022. The SANT published a draft discussion paper in December 2021 on the proposed taxation of electronic nicotine delivery systems (ENDS) and electronic non-nicotine delivery systems (ENNDS).

Traditional tobacco products in South Africa are subject to excise duties at a rate of 40 percent of the price of the most popular brand in each tobacco category, according to Longevity. When applied to e-cigarettes, users could pay excise duty ranging from ZAR33.60 to ZAR346.00 ($22.50) per product, depending on the nicotine content and size of that product. The average excise rate for e-cigarettes is proposed at ZAR2.91 per mL and apportioned in a ratio of 70:30 between nicotine and non-nicotine elements.

Basically, users could pay ZAR2.03 per mL of e-liquid containing nicotine and 87 cents per mL of e-liquids that contains no nicotine, if the draft proposals are accepted and become legislation. Products with a higher nicotine content will attract a higher rate of duty compared with lower nicotine products.

Manufacturers and importers who become liable for the proposed excise taxes on e-cigarettes will need stringent certifications by accredited laboratories, which use either South African National Accreditation or International Laboratory Accreditation Co-operation (ILAC) approved methodologies.

According to 2021 study commissioned by the Vapor Products Association of SA, the vapor industry in 2019 contributed ZAR2.49 billion to South Africa’s GDP while paying ZAR710 million in taxes. More than 350,000 South Africans use vapor products.