The Free Market Foundation is concerned that the South African government's plan to regulate vaping products will prompt more people to return to combustible cigarettes and buy them from the black market.

"The South African government believes that e-cigarettes are harmful and need to be regulated," said the Free Market Foundation. "However, e-cigarettes are tobacco harm reduction products designed to mitigate the adverse health effects associated with combustible tobacco products."

“Total excise taxes on nicotine and non-nicotine solutions, e-cigarettes will go from ZAR33.30 [$2.28] to ZAR346. As a result, poorer communities with tobacco-related illnesses will be more motivated to continue smoking than choosing healthier alternatives ”

"In reality, smokers may simply opt for illegal products, which are cheaper and make up 42 percent of the informal cigarette market. In addition, illegal goods are more harmful due to non-compliance with production standards."

South Africa's illicit cigarette market has grown substantially during the temporary tobacco ban, but has not yet shrunk to pre-lockdown levels.

"The National Treasury's proposal to tax vaping solutions that do not contain tobacco or nicotine may be questioned by some stakeholders because it does not necessarily support the government's stated policy intent to reduce consumption of tobacco products." A law firm Weber Wenzel said. "It could also spur the illicit trade in e-cigarettes, as has happened with the tobacco industry."

If passed, the proposed tax would go into effect on January 1, 2023.

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