Nicotine-free 'vape juice' will not escape new taxes

UAE issues new information amid growing concern about safety of e-cigarettes

A woman exhales vapour from an e-cigarette. Vaping has been marketed as a better alternative to smoking. Phil Noble / Reuters

Milkshakes could escape new charges on unhealthy products but even nicotine-free e-cigarette liquids will face taxes.

The UAE is expanding the scope of taxes, first introduced in 2017, which are designed to persuade people to lead healthier lives.

Initially applying to cigarettes, sugary fizzy drinks and energy drinks, the taxes will now also apply to non-fizzy drinks with added sugar, e-cigarettes and vape liquids from January.

Under guidance issued to businesses by the Federal Tax Authority (FTA), it is revealed that ready to drink beverages "containing at least 75 per cent milk or milk substitutes" would be among a small number of products exempt from the new charges. Baby formula, medical products and those designed for special dietary needs will also not be subject to the taxes.

However, all liquids in e-cigarettes, the battery-powered devices themselves, and similar smoking-related substitute products will be charged, even if they contain no nicotine. Some users of e-cigarettes attempt to gradually reduce the nicotine content of the liquids, until they reach zero.

The safety of e-cigarettes, the sale of which was legalised earlier this year, have divided experts. Some see them as a far less unhealthy alternative to cigarettes, but others believe they could fuel addiction and warn that health implications are uncertain. Yesterday, it emerged that a patient died in the United States after developing a lung condition linked to vaping - the first known case where a death had been directly tied to e-cigarettes.

Businesses selling relevant products have been urged to make sure they are familiar with the new system, with a new registration system having recently been introduced.

Juices and drinks containing added sugar and sweeteners will be subject to a 50 per cent tax, with smoking-related products facing a 100 per cent charge.

Khalid Ali Al Bustani, the FTA Director-General, said the existing policies had been supported by businesses and health professions.

"Excise Tax has been positively received by local, regional, and international stakeholders,"he said. "A recent report by the World Health Organisation Regional Office for the Eastern Mediterranean lauded the UAE for its efforts in combatting smoking by imposing Excise Tax on tobacco products, leading to a decline in local consumption of these and other harmful products covered by the tax.

"This points to the success of the UAE’s policies to reduce consumption of goods that negatively impact human health or the environment."