Vape shops in Scotland are set to lose business rates relief from 1 April 2027, under a Scottish Government move that puts specialist vape retailers at the centre of a wider row over high streets, public health and smoking harm reduction.
Deputy First Minister Jenny Gilruth announced the change in a statement to the Scottish Parliament, as ministers set out plans to reform Scotland’s non-domestic rates system.
Non-domestic rates, commonly known as business rates, are a property tax paid by occupiers of non-domestic premises. They are calculated using a property’s rateable value, broadly based on rental value, and a national tax rate, with councils applying any relevant reliefs.
The Scottish Government said vape shops are set to lose discounts from their bills as part of a wider review of the system.
Ministers cite youth vaping concerns
The move was framed partly as a public health measure. Clare Haughey, SNP MSP for Rutherglen and Cambuslang, asked how excluding vape shops from relief would contribute to Scotland’s public health commitments.
Gilruth said vaping had increased in Scotland in recent years and was highest among 16 to 24-year-olds. She also pointed to the growth of vape shops on high streets, saying they sell “products that cause addiction to nicotine and other health harms”.
The Deputy First Minister said the policy was intended to make vape shops “contribute to the high street” and ensure rates relief “aligns with our public health commitments”.
The latest Scottish Health Survey shows that in 2024, 10 per cent of adults in Scotland said they currently used e-cigarettes or vaping devices, up from a range of five to seven per cent between 2014 and 2021. Use was highest among adults aged 16 to 24, at 18 per cent.
However, smoking remains a much larger public health problem in Scotland. Fourteen per cent of adults were current smokers in 2024, unchanged from 2023, with smoking much more common in the most deprived areas than the least deprived areas.
Harm reduction tension
The decision lands in a sensitive area of nicotine policy. Vapes are not risk-free and are not recommended for children or people who have never smoked. But UK health bodies continue to describe vaping as substantially less harmful than smoking for adults who switch completely.
The NHS says nicotine vaping is less harmful than smoking and one of the most effective tools for quitting. It also says children and non-smokers should never vape.
A 2025 Cochrane review found that people were more likely to stop smoking for at least six months using nicotine vapes than using nicotine replacement therapy vapes without nicotine.
That creates a policy tension. Ministers want to reduce the appeal, visibility and availability of nicotine products to young people. Adult smokers, however, may rely on regulated vapes and specialist retailers when trying to move away from cigarettes.
The Scottish Government has not announced a ban on vape shops. But removing rate relief could raise fixed costs for smaller retailers at the same time as the sector faces tougher rules on advertising, retail display and product registration.
Part of a wider crackdown
The rates decision comes alongside a broader tightening of vape and nicotine rules.
The Tobacco and Vapes Act 2026 received Royal Assent in April and is expected to bring in a comprehensive ban on advertising and sponsorship of vaping and nicotine products from 1 June 2027.
The UK Government has said the law is designed to balance action on youth vaping with the role vapes can play in helping adult smokers quit.
In Scotland, separate regulations will extend retailer registration rules to businesses selling nicotine products, such as nicotine pouches, and herbal smoking products. The Scottish Government says the change is needed to support enforcement, reduce youth access and monitor where products are sold.
The Scottish Government’s business regulatory impact assessment said the Tobacco and Vapes Register had 11,762 registrations for retailers selling tobacco and/or vapes across Scotland as of 11 June 2026.
Questions for mixed retailers
One unresolved question is how the change will apply to mixed retailers, including convenience stores that sell vapes alongside other products.
The Government announcement refers to vape shops. Scottish Grocer reported that ministers had not confirmed how the move would affect convenience stores that stock vaping products.
While specialist vape shops are one route into regulated products for adult smokers, vapes are also sold through supermarkets, convenience stores and online retailers.
The Scottish Government will also appoint an independent panel to examine the outcome of the 2026 non-domestic property revaluation, after reports of inconsistent valuations.
The panel will assess whether anomalies exist and report within three months of being appointed.
