Irish Finance Minister Michael McGrath has delayed a tax on e-cigarettes over concerns it would deter smokers from using e-cigarettes to quit smoking.

Treasury officials say a balance needs to be struck between discouraging young people from vaping and supporting existing smokers to switch to e-cigarettes to quit smoking. According to media reports, health officials have recommended imposing different taxes on e-cigarettes based on their relative harm compared to traditional cigarettes.

McGrath said imposing new taxes on e-cigarettes would be "challenging". The country’s government intends to tax e-cigarettes as part of a public health response to e-cigarettes. “Domestic tax will require significant IT, management, control and compliance costs,” McGrath said.



Michael Randall, Director of the World Federation of Vapers, said: “We welcome the Finance Minister’s decision and ask the Irish Government to maintain a sufficiently large tax differential between e-cigarettes and traditional cigarettes in future to incentivize smokers to switch to e-cigarettes. "E-cigarette products pose far less risks than burning cigarettes, so they should be taxed. If this tax is approved, tens of thousands of e-cigarette users will return to smoking."

Research suggests that increasing taxes on e-cigarettes could lead to an increase in smoking rates, especially among young people. The Treasury Department filing also expressed concern that e-cigarette users would turn to the black market once the tax is enacted.

Implementation of the tax has been delayed with no new date in sight while the government awaits an EU framework to ease its implementation. Updates to the EU Tobacco Tax Directive are expected to include an EU-wide excise tax on e-cigarette products.

"Taxing e-cigarette products, similar to burning cigarettes, would have a negative impact on public health by driving e-cigarette users back to smoking or entering the black market and discouraging smokers from switching to e-cigarettes," Randall said. We advise other countries and the EU to follow Ireland’s example and not impose e-cigarette taxes.”