South Africa to Introduce Excise Duty on Vaping Tobacco Products 

In the 2022 Budget announcement made by the South African Minister of Finance on February 23, 2022, it was revealed that excise duty on vaping tobacco products would be introduced in the country. Effective June 1, 2023, the new policy will include nicotine and nicotine-substitute solutions in vaping products in the tax net with a flat excise duty rate of R2.90/ml.

Manufacturers of vaping products are required to apply for and obtain licenses for their manufacturing premises with the South African Revenue Service (SARS) before June 1, 2023, and submit their first excise duty account by July 28, 2023. SARS will collect the excise duty on vaping products in accordance with Part 2A of Schedule No. 1 of the Customs and Excise Act, No. 91 of 1964.

The forms DA260 Excise Account for Tobacco Products will be amended to include vaping products for excise duty purposes, and special storage warehouses for these products must also be licensed with SARS before June 1, 2023.

In a letter to vape traders, SARS said: “These amendments as published in the Government Gazette are available on the SARS website at the following links respectively…For any Licensing and Registration queries please contact the nearest Customs Branch office or email CustomsSSMReg@sars.gov.za.”

This new policy will have a significant impact on the vaping industry in South Africa, and manufacturers must act quickly to comply with the new regulations.

In conclusion, the introduction of excise duty on vaping tobacco products in South Africa reflects a growing global trend to regulate and tax the vaping industry. While the new policy may be seen as a challenge for manufacturers, it also presents an opportunity for them to improve their production processes and product quality to comply with regulatory standards. As the industry evolves, it is important for manufacturers to stay abreast of new developments and adapt to changing regulations to remain competitive in the market. Additionally, consumers may also need to adjust to higher prices for vaping products, which may ultimately result in reduced consumption.