From July 2025, the Polish government’s planned new vape tax policy is likely to cause the vape brand market to shrink, traditional cigarette products once again dominate the market, and local small and medium-sized enterprises will face a heavy blow.
Polish new policy may cause 95% of vape products to “disappear”
Vape devices in Poland will face consumption taxes of 40 zloty ($10) per unit starting in July 2025, according to Maciej Powro This will cause the retail price of the equipment to rise to about 80 zlotys ($20). Taxes on e-liquids are also set to rise significantly in the coming years, which could lead to the disappearance of vapes and related products from the market, with traditional tobacco products and big tobacco companies benefiting at the expense of local SMEs.
Traditional tobacco industry to benefit
According to the Ministry of Health, the number of vaping-related enterprises entering the Polish market in 2020 has rapidly increased from 87 to 4,430 in 2023, most of which are imported disposable vape devices.
Currently, these vape devices are not subject to excise tax, but the Ministry of Finance plans to change this through a new legal amendment. The proposal will come into effect in April 2025 and be implemented in July. The change would result in vape devices becoming unharmonized tax goods and an increase in the 40 zloty ($10) tax rate.
It is expected that the new laws and regulations will seriously reduce vape in the form of tax increases, and the cost of finished products for customers will continue to rise over several years, eventually reaching 1.8 PLN ($0.45) per milliliter, which will be the highest tax rate in the EU.
Some industry insiders pointed out that this may lead to traditional tobacco once again dominating the market, and the vape industry is mainly dominated by local small and medium-sized enterprises, so the policy change may bring a heavy blow to local enterprises.
The new tax policy will seriously affect the Polish vape industry, and many businesses may not be able to withstand the increased financial pressure. While the Treasury is aware of the potential risks that could lead to business failure, it still stresses the need to take steps to enter other markets or transform to remain in business.
While the Ministry of Finance expects the new policy to bring in considerable fiscal revenue, industry insiders predict that the achievement of the fiscal target will face great challenges due to the shrinking market and consumers turning to illegal channels. Based on available data, the illegal market could expand to its current 50% share.
