Korea to Crack Down on E-liquid Tax Evaders

South Korea plans to crack down on traders who try to evade taxes on e-liquids by falsely claiming that their products contain synthetic nicotine rather than tobacco-derived nicotine, reports The Korea Bizwire.

On Nov. 10, the Korea Customs Service announced it has developed a highly accurate method to identify whether the nicotine contained in e-liquid is extracted from tobacco leaves or created in a laboratory. 

This method uses derivatization technology to increase the detection sensitivity by a factor of 30. 

Classified as cigarettes under tax laws, e-liquids containing natural nicotine are subject to an inland duty of KRW1,799 ($1.32) per mL. 

By contrast, e-cigarettes containing synthetic nicotine are classified as manufactured goods and are therefore exempt from cigarette consumption taxes.