Ireland ponders e-liquids tax

The Irish government has been told to consider introducing a levy on e-liquids, according to a story by Sarah Bardon for the Irish Times.

The Department of Finance says a levy of 50 cents on every 10 ml of e-liquids, which are largely used by people attempting to quit smoking, could yield €8.3 million annually.

The proposal is included in a tax strategy paper published by the department which outlines a number of options in the area of excise duty.

‘However, the implementation and collection of such a tax would be difficult given the wide variety of ways in which these products are supplied to the consumer,’ the department says. ‘Secondly, as previously stated, many sources consider e-cigarettes to be a cessation tool and certainly less harmful than cigarettes.’

Bardon reported that four EU member states – Portugal, Italy, Romania and Slovenia – have introduced taxes on electronic cigarettes or on the e-liquids used in them.

But she said also that Public Health England, an agency of the UK’s department of health, had determined that while the use of electronic cigarettes was not risk-free, it carried just a fraction of the risk associated with smoking.

At the moment, the Department of Health is preparing the general scheme of a bill for the introduction of a licensing system for the sale of tobacco products and non-medicinal nicotine delivery systems, including electronic cigarettes.

The legislation would prohibit the sale of tobacco products from self-service vending machines and temporary or mobile units/containers. It would prohibit also the sale of non-medicinal nicotine delivery systems by and to persons under the age of 18 years.

Meanwhile, the tax strategy paper says Ireland has the second-highest excise duty on tobacco-related products in the EU. However, the Department of Finance said it should be noted that the Revenue Commissioners had expressed concerns that increases in excise might not lead to increased revenue because consumers would be further incentivized to exit the tobacco products market in Ireland.