More vapor taxes come to the Middle East

Jordan and Saudi Arabia have joined the ranks of countries which levy taxes on vapor products.

The Kingdom of Jordan has introduced a tax of 200% on the CIF (Cost, Insurance & Freight) value of nicotine containing liquid. A similar tax falls on the CIF value of e-cigarette devices.

In addition, Jordanian legislation has created a new excise tax category for heated tobacco products (HTP) – “Tobacco products intended for heating”. A tax of JOD 3.0 is applied per 200 units, i.e. rods of tobacco. No tax is levied on the HTP devices. Both taxes were in effect as of 2 May 2019.

Saudi taxes

In Saudi Arabia, the General Authority of Zakat and Tax announced that it would expand the group of products subject to a 100% excise tax to include e-cigarettes in an effort to boost non-oil revenues. Saudi Arabia joined Bahrain and United Arab Emirates (UAE) in 2018 in implementing an excise tax on tobacco products. Bahrain took the additional step in July 2018 of classifying e-liquids as tobacco products and therefore subject to the 100% tax on CIF value.

Details of the new tax in Saudi Arabia have nor been released yet but it is believed that HTP will not be included.