As outlined in the response to the Vaping Products Duty consultation, the government now intends to implement a vaping duty stamp scheme. This consultation sets out in further detail the proposals for how the scheme is intended to work.
Vaping duty stamps will help enable HMRC’s strategic objective of making it easy to get tax right and hard to bend or break the rules. Vaping duty stamps will support both enforcement bodies and industry in identifying products that are non-duty paid, therefore illicit. They may also help HMRC to manage the initial sell-through period and limit the duty avoidance practice known as forestalling. This is the practice of clearing large quantities of excise goods from duty suspense immediately prior to a rate increase to avoid paying the new rate.
HMRC are also exploring options to limit illicit production of vaping liquids by placing controls on the supply of nicotine. Such controls may help prevent nicotine solutions used in the manufacture of vaping products from being obtained by those seeking to commit tax fraud by producing products in premises which are not approved by HMRC.
The government is running this consultation to seek your views on the proposed design of the vaping duty stamp scheme and whether HMRC should implement controls on the supply of nicotine.