The price to puff: Alberta bringing in its own tax on vaping products

Alberta is the latest province in Canada to bring in its own tax on vaping products, in addition to its partnership with the federal government’s tax on vaping products.

The new tax is part of Budget 2024, which was unveiled at the Alberta Legislature in Edmonton on Thursday afternoon.

Alberta previously committed to joining the existing federal-provincial coordinated vaping tax framework at the “next opportunity” back in 2022.

“This approach minimizes the compliance burden on Alberta businesses and reduces the risks of tax leakage,” the provincial government said.

Under this framework, the federal government has applied a tax on vaping substances at the following rates since October 2022:

•$1 per 2 millilitres (mL) or gram (g), or fraction thereof, for the first 10 mL/g of vaping substances in the vaping device or container, plus
•$1 per 10 mL/g, or fraction thereof, for amounts over the first 10 mL/g.

In addition to the federal tax, starting as early as January 1, 2025, vaping substances sold in Alberta will also be subject to a provincial tax at the same rates, with the federal government administering the collection of the coordinated tax at no cost to Alberta.

Alberta joins Ontario, British Columbia, Nova Scotia, Saskatchewan, and Newfoundland and Labrador which have already brought in their own provincial tax on vaping products.

The provincial vaping tax is expected to generate $4 million in revenue in
2024-25, while revenue is anticipated to bump up to $18 million in 2025-26.

If you smoke cigarettes in Alberta, the cost of buying them is set to go up soon, too.

The province says starting March 1, the tax on cigarettes will increase by 2.5 cents to
30 cents per cigarette and the tax on smokeless tobacco will rise by 7.5 cents to
35 cents per gram.

The increase is set to generate $25 million in additional revenue in 2024-25.