1. Consumption Tax Amendment (effective January 1, 2026): ZATCA has issued significant amendments to improve the tax base, reclassify taxable goods, update tax rates, and strengthen compliance obligations. Tobacco products, energy drinks, and electronic cigarette devices/liquids will still be subject to a 100% tax rate. The tax base shall be calculated based on the highest of the following three: declared retail price (RSP), ZATCA reference retail price, or GCC uniform standard price. 2. Ban on Tobacco Sales in Small Grocery Stores (June 2025): The Ministry of Urban and Rural Affairs and Housing has issued a directive prohibiting the sale of tobacco products (including e-cigarettes and cigarettes) in convenience stores (baqalas), vending kiosks, and mini markets. These products can only be sold in supermarkets (≥ 100 square meters) and large supermarkets (≥ 500 square meters). Existing merchants have a six-month transition period to clear inventory. 3. Digital tax invoice system (tender in April 2026): ZATCA has launched a tender for a digital tax invoice solution for taxable goods (electronic cigarette equipment and liquid), further strengthening the tax monitoring and traceability capabilities of electronic cigarette products. 4. Clarification of taste restrictions: SFDA technical regulations explicitly prohibit flavors such as cocoa, vanilla, coffee, tea, spices, candies, chewing gum, cola, and alcohol. Allow fruit flavor, mint flavor, or a combination of both. 5. The use of electronic cigarettes is included in the smoking ban: The implementation regulations of the smoking ban law clearly extend the definition of "smoking" to the use of electronic cigarettes, and prohibit the use of electronic cigarettes in most indoor public places and workplaces. 1. Improvement of regulatory system: Saudi Arabia has established a complete regulatory framework covering electronic cigarettes, referring to the EU TPD technical requirements. Multi departmental collaborative supervision including SFDA (Product Standards), SASO (Equipment Safety), ZATCA (Taxation), etc. 2. Clear harm reduction path: Unlike countries such as Belgium that have implemented comprehensive bans, Saudi Arabia adopts a strategy of "providing alternatives to promote smoking cessation". The CEO of SFDA has made it clear that providing nicotine alternatives is more effective in achieving long-term public health goals than a complete ban. 3. Centralization of retail channels: Starting from June 2025, electronic cigarettes can only be sold in medium to large retail venues, and small convenience stores and vending kiosks are prohibited from selling, promoting the development of sales channels towards standardization and high barriers to entry. 4. Digitization of tax supervision: ZATCA continues to promote digital tax invoice solutions, gradually incorporating electronic cigarette products into the full chain traceability from import to consumption. 5. Nicotine bags are subject to regulation: In 2023, SFDA issued the "Regulations on the Supervision of Electronic Cigarette Devices and Products", requiring all nicotine bag products to be registered with the Ministry of Health and comply with packaging, labeling, and ingredient restrictions.