How Donald Trump’s Tariffs Will Affect the Vaping Industry

How Donald Trump’s New Tariffs Will Affect the Canadian Vaping Industry

On February 1, 2025, President Donald Trump imposed new tariffs that are expected to have a significant impact on industries across North America, including Canada’s vaping sector. Under this new tariff policy, the U.S. has introduced a 25% tariff on goods imported from Canada and Mexico, while maintaining a 10% tariff on goods imported from China. Given the vaping industry’s reliance on imports, especially from the U.S. and China, these changes are likely to affect pricing, supply chains, and overall market dynamics for Canadian businesses and consumers. Additionally, Trump has indicated a potential concession on oil tariffs, which could slightly alter the financial landscape for industries relying on petroleum-based products, though the direct impact on vaping will be more limited.

Trump and Cannabis

Donald Trump’s tariffs will have a wide spread effect, click here to read about how it will effect the Cannabis Industry

Trump’s Influence on the Vaping Industry

Trump’s previous presidency had a marked impact on the vaping industry, especially with his introduction of tariffs on Chinese goods, which led to price increases on various vaping products. His administration also explored flavor bans on e-cigarettes, fueling debates about regulation within the industry. Although the flavor ban never fully came to fruition, the tariffs on vaping products did contribute to increased costs for both consumers and businesses, particularly for vape hardware imported from China.

With Trump’s return to office and the imposition of new tariffs, the Canadian vaping industry once again finds itself at the mercy of U.S. trade policies. This time, the 25% tariff on goods from Canada and Mexico stands to increase costs for Canadian businesses that rely on U.S.-manufactured vaping products, while the 10% tariff on Chinese imports will continue to affect pricing for vape hardware sourced from China.

How the New U.S. Tariffs Will Impact the Canadian Vaping Industry

The 25% tariff on goods from Canada will have immediate consequences for the Canadian vaping market. Products like vape mods, tanks, batteries, and packaging—often manufactured or distributed in the U.S.—will see a price hike. These higher costs will likely be passed on to Canadian consumers, who will face an increase in the price of vaping hardware and related accessories. For example, a vape mod made in the U.S. and sold in Canada could see a price increase of 25%, potentially raising the cost of a unit by $20 to $50 depending on the product.

Retailers will need to decide whether to absorb the increased costs, reducing their profit margins, or pass them on to customers, which could lead to a drop in sales or customer dissatisfaction. As vaping products become more expensive, Canadian consumers may choose to reduce their spending, which could negatively affect demand for premium products. Alternatively, some consumers may seek cheaper alternatives, possibly turning to smaller, less regulated sources of supply, which could introduce concerns about product quality and safety.

The Potential Impact of the Oil Tariff Concession

One of Trump’s potential concessions involves reducing the oil tariff from 25% to 10%. While this reduction could help alleviate some financial pressure on industries dependent on oil and petroleum-based products, the impact on the vaping industry is likely to be minimal. Vaping products are not typically made from oil-based components, so this shift will not directly affect the price of vape hardware, e-liquids, or other vaping accessories.

However, the 10% oil tariff reduction could indirectly benefit industries like shipping and transportation, which rely on petroleum for fuel. If energy costs decrease, the price of shipping vaping products—whether they come from the U.S. or overseas—could drop slightly. This could, in turn, mitigate some of the price hikes caused by the 25% tariffs on U.S.-Canada trade. However, any savings would likely be marginal compared to the overall increases due to the direct tariffs on vaping products.

How Large of a Dollar Value Could These Tariffs Represent?

To understand the impact of these tariffs, it’s important to examine the dollar value of goods involved. Canada exports billions of dollars worth of goods to the U.S. each year, and a significant portion of these exports are consumer goods, including vaping-related products.

For instance, if vaping-related imports from Canada to the U.S. total $500 million annually, a 25% tariff could add an additional $125 million in costs. These increased costs would be passed down the supply chain, raising the prices of vaping hardware, accessories, and e-liquids for Canadian consumers. Retailers would need to adjust their pricing strategies to account for these additional costs, which could lead to higher prices at the point of sale.

The Role of Chinese Imports and the 10% Tariff

In addition to the tariffs on Canadian goods, the 10% tariff on Chinese imports will continue to affect vaping products, particularly hardware and components. Much of the vaping industry in Canada, as well as the U.S., relies on Chinese-made goods, such as e-liquid ingredients, coils, batteries, and tanks. Although the 10% tariff is lower than the 25% on Canadian goods, it still represents a substantial increase in costs for Canadian businesses importing vaping products from China.

For example, if a Canadian retailer imports $1 million worth of vape products from China, a 10% tariff could result in an additional $100,000 in costs. These costs would need to be passed on to consumers, either in the form of higher retail prices or lower-quality alternatives as businesses try to absorb the increased expenses.

Conclusion

Donald Trump’s new tariffs on Canadian and Mexican goods, combined with the 10% tariff on Chinese imports, will have a noticeable impact on the Canadian vaping industry. The 25% tariff on U.S.-Canada trade will likely raise prices for vaping hardware and accessories, putting financial pressure on both businesses and consumers. The 10% tariff on Chinese goods will continue to raise the cost of vaping components, affecting the pricing of e-liquids and other related products.

While Trump’s potential concession on oil tariffs could provide minor relief, it will not significantly alter the broader financial landscape for the vaping industry. Canadian businesses will face higher costs, and consumers will likely see price increases across the board. The long-term effects will depend on how businesses adapt to these new tariffs—whether through sourcing alternatives, adjusting pricing strategies, or seeking cost-saving measures. For now, Canadian vapers can expect to pay more for their favorite products as these tariffs take effect.