Pakistan’s FBR Imposes First-Ever Excise Duty on Vape E-Liquids

Islamabad Vape Ban, Pakistan E-cigarette Bill

The Federal Board of Revenue (FBR) has brought e-liquids under the scope of Pakistan’s federal excise duty for the first time, establishing a rate of Rs16,500 per kilogram. This regulatory expansion, enacted through amendments to the Federal Excise Act 2005, remains in effect up to June 30, 2026, as part of a state strategy to increase federal revenue.

The tax regime requires manufacturers, importers, and suppliers of e-liquids to immediately adjust their business operations to comply with the revised terms. Previously untaxed under this framework, the inclusion of e-liquids will directly impact supply chain costs.

Industry stakeholders expect the excise duty to trigger a sharp increase in retail prices for electronic cigarettes and vape products across Pakistan. Businesses are currently assessing how this added cost will affect consumer demand and overall market trends.

This policy shift represents a major regulatory transition for the domestic vape market. Beyond e-liquids, the FBR has updated duty structures for several other product categories to meet its broader fiscal targets.

Matthew Ma
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