Vapers in the United States, particularly in Alabama, are about to see major price increases. Starting as early as this week, local vape taxes are taking effect across Alabama, followed by a new statewide e-liquid tax in October 2026. For Canadian vapers, especially in Ontario, these developments offer important lessons about how taxes can shape the vaping market.

At Dragon Vape, we’re committed to keeping our customers informed about global vaping regulations, price changes, and industry trends, so you can better understand how they might impact vaping in Canada.

Alabama’s Patchwork of Local Vape Taxes

Alabama municipalities have rushed to pass their own vape taxes before Oct. 1, 2025, the deadline when state law will prevent new local taxes on e-liquids.

• Local taxes vary, with some cities adopting a $0.10 per mL tax while others chose lower rates.

• These taxes are in addition to the upcoming statewide tax of $0.10 per mL, set to begin in 2026.

• Cities like Chelsea, Decatur, Dothan, Fairhope, Foley, Gulf Shores, Muscle Shoals, Orange Beach, and Spanish Fort have already enacted taxes. Mobile, Alabama’s second-largest city, is still debating an ordinance.

For consumers, this means higher prices at checkout. For vape retailers, it means added compliance headaches and reduced competitiveness against online and out-of-jurisdiction sellers.

The Statewide Tax and Its Impact

Beginning October 2026, Alabama will impose a $0.10 per mL wholesale tax on e-liquids, whether they contain nicotine or not.

• Revenue from this tax will be split between counties (25%) and municipalities (25%), based on population.

• However, local governments that pass their own taxes won’t receive state tax revenue, meaning small businesses may be hit twice.

• Ultimately, these costs will be passed on to consumers, making vaping more expensive across the state.

This reflects a wider trend: six U.S. states, including Alabama, have passed or increased vape taxes in 2025, signaling stronger government oversight and rising costs.

Why Canadian Vapers Should Pay Attention

While these developments are happening in the U.S., they raise important points for Canadian vapers:

1. Tax Pressure Could Increase
   Canada already imposes excise taxes on vaping products, with different rates by province. If the U.S. trend continues, Health Canada could explore similar increases.

2. Local vs. Federal Regulation
   Alabama shows how local and state taxes can overlap, creating confusion. In Canada, most regulation comes federally and provincially, but changes can still come quickly.

3. The Importance of Buying from Trusted Retailers
   With rising taxes and regulations, Canadian vapers should stick with licensed vape shops like Dragon Vape Ontario, which stay compliant with Health Canada rules and provide transparency on pricing.

Conclusion

Alabama’s rush to pass local vape taxes and its upcoming statewide e-liquid tax highlight the challenges facing vapers and retailers in the U.S. As prices rise and compliance becomes more complicated, Canadian vapers should take note: taxation trends south of the border often ripple into our own market.

At Dragon Vape Ontario, we continue to monitor global regulations and keep our community informed, while providing affordable, compliant, and high-quality vaping products across Canada.