There is now less than a year until the UK Government introduces Vaping Products Duty (VPD) and vaping duty stamps (VDS) on 1 October 2026.

VPD, a new excise duty, will apply to all vaping liquids (or e-liquids) sold or supplied in the UK, at a flat rate of £2.20 per 10ml and VDS must be attached to individual vaping products.

From 1 April 2026, any business involved in the manufacture or importation of vaping products, or storage of duty-suspended vaping products, must apply for approval from HMRC. This will enable them to continue operating lawfully in the UK once VPD and the VDS Scheme come into effect.

With just six months until approval registration opens, HMRC is urging all affected businesses to prepare now to avoid disruption as approval may take up to 45 working days.

What this means for businesses:

• UK manufacturers of vaping products must apply for approval for both VPD and the VDS Scheme.
• Warehouse keepers will be able to apply for VDS Scheme approval directly.
• Overseas manufacturers must appoint a UK representative to apply for the VDS Scheme on their behalf.
• Importers will be required to pay the new duty. They must also register for VPD and the VDS Scheme if they are acting as a UK representative for an overseas manufacturer.

Rachel Nixon, HMRC’s Director of Indirect Tax, said:

‘We are working closely with the vaping sector ahead of these changes. Businesses are encouraged to visit GOV.UK and search ‘prepare for vaping duty‘ to access guidance and updates. Early preparation is essential to ensure a smooth transition and to avoid disruption to operations.’

Internet link: HMRC press release

Chancellor Rachel Reeves should use the Autumn Budget to reform the UK’s tax system, says the Institute for Fiscal Studies (IFS).

The think tank says this would help Ms Reeves to raise more revenue while limiting the hit to the economy.

The IFS warns the Chancellor against raising the levels of existing taxes to bring in the estimated £30 billion she requires to stay on course for her targets to repair the public finances.

Changes to wealth-related taxes, including Capital Gains Tax, would be more effective than the introduction of an annual wealth tax, the think tank added.

Isaac Delestre, a Senior Research Economist at IFS, said:

‘Revenue-raising seems likely to be a major goal of the coming Budget. But if Rachel Reeves limits her ambition to collecting more revenue, she will have fallen short.

‘Almost any package of tax rises is likely to weigh on growth, but by tackling some of the inefficiency and unfairness in our existing tax system, the Chancellor could limit the economic damage.

‘The last thing we need in November is directionless tinkering and half-baked fixes. There is an opportunity here. The Chancellor should use this Budget to take real steps down the road towards a more rational tax system that is better geared to promoting the prosperity and well-being of taxpayers.’

Internet link: IFS

Failed housing transactions cost consumers and the economy at least £1.5 billion every year, according to research published by Santander.

The research says that over 530,000 transactions fall through every year due to the UK’s antiquated homebuying process.

The economic analysis shows that the direct cost to consumers of this through expenditure on elements such as mortgage and solicitors’ fees that consumers cannot recoup, is £560 million annually.

However, the impact is not just limited to consumers. The repercussions on the broader economy include the loss of work output due to stress and the time taken to buy a property within work hours, estimated at £380 million per year.

There is also the cost of people’s reduced wellbeing, estimated to be £400 million and wasted leisure time, approximately £170 million.

David Morris, Head of Homes at Santander UK, said:

‘The homebuying journey is still operating in the confines of a framework that was established a century ago. This antiquated system is an increasingly heavy anchor weighing on the economy and fixing it must be key.

‘While the government has put the housing market firmly on its agenda – as this research shows – the scale of the challenge remains largely underappreciated, and that’s why we’re calling for powerful reforms to give buyers and sellers more confidence, ease the financial and emotional strain and create a housing system fit for the needs of today’s consumers and economy.’

Lowering the threshold for VAT registration in the Autumn Budget would breach Labour’s manifesto, IPSE, the Self-Employed Association has warned.

IPSE says that the government is in a bind both politically and economically. Having ruled out tax rises on ‘working people’ and hiking employer National Insurance contributions (NICs) the Chancellor’s options are limited.

IPSE asks, in these circumstances will Ms Reeves reform taxes rather than raising them?

Sole traders are required to register for, charge and pay VAT once their annual turnover goes over £90,000.

IPSE says this threshold can put a ceiling on the ambitions of sole traders earning close to that amount; they may be reluctant to artificially increase the price of their services by 20%, giving customers and clients a reason to buy from competitors.

Newspaper reports say that the Treasury is now considering slashing the threshold to as low as £30,000.

Fred Hicks, Senior Policy and Communications Adviser at IPSE, said:

‘This would make registering for VAT unavoidable for anyone whose main source of income is from self-employment, and then some.

‘Cutting the VAT registration threshold is not the same as increasing rates of VAT – even if it ultimately ends up with more people having to charge and pay it. And if this radical reform did go ahead, this may well be how government justifies it.

‘But make no mistake – in IPSE’s eyes, it absolutely would be a breach of their commitment – and a breach of faith – to claim that dragging people into paying a new tax is not the same as putting their taxes up.’

Internet link: IPSE

Artificial intelligence (AI) could boost the value of cross-border flows of goods and services by nearly 40% by 2040 thanks to productivity gains and lower trade costs, according to a World Trade Organization (WTO) report.

However, the report says that for AI and trade to contribute to inclusive growth policies need to be in place to bridge the digital divide, invest in workforce skills, and maintain an open and predictable trading environment.

William Bain, Head of Trade Policy at the British Chambers of Commerce (BCC), said:

‘This report is a call to action for business and policymakers worldwide to ensure we realise the full benefits of AI in boosting global trade, productivity and skills.

‘It identifies a possible AI premium for global economic growth of 12-13% and goods export growth of up to 37% by 2040. AI can boost exports by reducing red tape, speeding up journey times, and cutting customs delays. AI-services are also highly exportable, and can be a major source of growth, in an area where the UK is already a world leader.

‘But tariff and technical barriers to trade need to be dealt with to allow AI to realise these full gains. We also need to ensure that electronic transmission of services across the world remains tariff-free.’

Internet link: WTO BCC