Updated Federal Excise Act 2005 introduces new duty on E-liquids used in electric cigarette kits from June 30, 2026

The Federal Board of Revenue (FBR) has imposed a new Federal Excise Duty (FED) on E-liquids used in electric cigarette kits under the updated Federal Excise Act, 2005, amended up to June 30, 2026.

According to the revised law, a federal excise duty of Rs16,500 per kilogram has been imposed on E-liquids, by whatever name called, used for electric cigarette kits.

The updated FED rates form part of amendments made to the Federal Excise Act, 2005, aimed at revising the taxation structure on various products subject to excise duty.

New FED rate on E-liquids

Under the amended Federal Excise Act, E-liquids used in electric cigarette kits will now attract a duty rate of Rs16,500 per kg.

The move places E-liquid products within the federal excise duty framework, with manufacturers, importers and suppliers required to comply with the updated taxation provisions.

FBR updates excise duty framework

The FBR regularly updates the Federal Excise Act to revise duty structures on different categories of goods and services. The latest amendments include changes applicable from the updated version of the law issued up to June 30, 2026.

The introduction of FED on E-liquids is expected to impact the pricing and supply chain of electric cigarette products in Pakistan.

Impact on electric cigarette market

Industry stakeholders are likely to assess the impact of the new excise duty on import costs, retail prices and consumer demand for electric cigarette products.

The revised tax measure comes as the government continues to broaden the scope of revenue collection through adjustments in federal taxation policies.