Canadian vapers will see higher prices starting in the new year as three more provinces and one territory enter a federal taxation program on vaping products.
Beginning January 1, Alberta, New Brunswick, Prince Edward Island, and Yukon will impose new or increased taxes on vaping products.
Alberta’s plan, part of its participation in the federal-provincial coordinated vaping tax framework, features a tiered approach designed to capture revenue from various product sizes.
The system charges $1 per two millilitres or grams for the first 10 mL/g and $1 per 10 mL/g for any additional volume.
This model is projected to generate $4 million in 2024–25 and rise to $18 million by 2025–26.
Adam Ward, the owner of Cloud Chaserz Vape Shop in Calgary, said he is worried about how the new charges will affect his business.
“The upcoming vaping tax increase in Alberta starting January 1 is going to hit my vape shop hard,” Ward told the Western Standard in an interview.
“It’s not just about the cost to consumers; it’s about the sustainability of my business. With higher prices, we’ll see fewer customers, which means less revenue for us. This tax could force many to either go back to smoking or seek out unregulated products, both of which are bad for public health and disastrous for my business’s bottom line.”
In New Brunswick, officials announced in the provincial budget that the province would double its existing vape tax beginning January 1.
Having previously not participated in the federal agreement, New Brunswick is now signing on to Canada’s coordinated vaping product taxation plan.
Under this agreement, Ottawa will collect the tax and return half the proceeds to the province.
The rate is set at $1 for every two millilitres of e-liquid up to 10 mL, followed by another dollar for each additional 10 mL.
The shift means vapers will pay about $7 extra in taxes on a standard 30 mL bottle of vape juice.
New Brunswick will collect approximately $4 million in annual revenue from this policy.
Prince Edward Island (PEI) also signed onto the federal agreement.
Under its new agreement with the federal government, starting January 1, PEI will charge a combined rate of $2.24 per two millilitres for the first 10 mL of a vaping substance and $2.24 per 10 mL after that.
The tax applies to all vaping substances, whether they contain nicotine or not, but excludes cannabis-related products.
PEI anticipates receiving about $530,000 during the first quarter of 2025 and approximately $2.4 million in the 2025–26 fiscal year.
Yukon is the latest territory to join Canada’s Coordinated Vaping Product Taxation Framework.
Starting January 1, it will introduce combined federal and territorial taxes, adding up to $2.24 per two millilitres for the first 10 mL of e-liquid and $2.24 per 10 mL for any volume beyond that.
Within this total, $1.12 represents federal tax and $1.12 represents territorial tax.
Yukon also plans to require territory-specific excise stamps to confirm that products meet both federal and territorial requirements.
The Yukon could receive $115,000 in revenue during the 2024–25 fiscal year.
Officials have said the money will help fund health programs that address tobacco and nicotine use.
These changes reflect a growing national trend toward aligning taxes on e-cigarettes with those applied to traditional cigarettes.
The federal government introduced an excise duty framework for vaping products in October 2022, and some provinces quickly followed while others waited.
With Alberta, New Brunswick, PEI, and Yukon on board, Canada’s vaping tax landscape is becoming more uniform, although variations still exist from province to province.
British Columbia was one of the first to enact a provincial vape tax, introducing a 20% sales tax on vaping devices and liquids in January 2020.
Later that year, Nova Scotia adopted a different formula, levying $0.50 per millilitre of vaping liquid and $0.50 per gram of vaping solids while imposing a 20% tax on e-cigarette devices.
Newfoundland and Labrador followed in January 2021 with its own 20% tax on vapour products.
Saskatchewan established a similar 20% vapour product tax in September of the same year.
These early steps laid the groundwork for the current federal-provincial cooperation.
Critics of these measures argue that they punish smokers trying to switch from traditional cigarettes.
Higher prices could deter some from adopting what they see as a less harmful alternative.
Many health experts consider vaping to be less dangerous than smoking, but they caution that e-cigarettes are not risk-free.
Long-term effects are still being studied, and high-nicotine products can lead to addiction.
By increasing taxes, governments hope to reinforce a message that, while vaping might be less harmful than smoking combustible cigarettes, it remains a regulated product.
With these new taxes set to roll out on January 1, vapers in Alberta, New Brunswick, PEI, and Yukon will notice immediate changes at the cash register.
Whether these added costs significantly reduce e-cigarette use, encourage some to go back to traditional tobacco, or drive the market underground remains to be seen.
In the meantime, both consumers and business owners are bracing for the financial impact.