Is Vaping Still Cheaper Than Smoking?
Despite the introduction of the new levy, vaping remains a more cost-effective alternative to traditional tobacco.
To preserve this price gap and continue encouraging smokers to switch, the government confirmed in the 2025 Budget a concurrent one-off increase of £2.20 per 100 cigarettes, or per 50 g of tobacco, taking effect on the same day the vape tax is introduced. In other words, consumers do not need to worry that vaping will suddenly become more expensive than smoking, as traditional tobacco products are also becoming costlier.
When looking at overall spending, the difference is still clear.
Cost Comparison Data:
A 2 ml pod with 20 mg/ml nicotine contains about 40 mg of nicotine, roughly equivalent to around 40 cigarettes. For a typical pack-a-day smoker (20 cigarettes per day), weekly consumption equals 140 cigarettes.
Weekly Smoking Cost
- Average cigarette price in the UK: ~£15 per pack (20 cigarettes)
- Weekly usage: 7 packs
- Total weekly smoking cost: about £105
Weekly Vaping Cost (After Tax)
Assuming the same nicotine intake level:
- Required usage: 7 × 2 ml pods per week
- Average pre-tax pod price: ~£5 per pod
- Base vaping cost: 7 × £5 = £35
- New vape duty: £0.44 per pod
- Added tax: 7 × £0.44 = £3.08
This means vaping still costs around 60–65% less than smoking for users with similar nicotine consumption levels.
Impact on Sellers and the Supply Chain
Vaping Duty Stamps
The introduction of the Vaping Products Duty brings new logistical challenges for the supply chain. Every bottle of e-liquid must now feature a legitimate HMRC duty stamp to prove the tax has been paid.
The “Shortfill” Crisis
The most significant disruption is expected in the “shortfill” market. These 50ml and 100ml bottles are currently popular for their value, but they will be hit hardest by a volume-based tax. A 100ml shortfill bottle could see a price jump of over £26 in duty alone.
Retail Compliance
Retailers are also facing a margin squeeze as they attempt to balance the higher wholesale costs with the price sensitivity of their customers.
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