diff --git a/lib/ansible/plugins/action/include_vars.py b/lib/ansible/plugins/action/include_vars.py
index 554c7d2c04..55a53b0cee 100644
--- a/lib/ansible/plugins/action/include_vars.py
+++ b/lib/ansible/plugins/action/include_vars.py
@@ -137,8 +137,8 @@ class ActionModule(ActionBase):
                     results.update(updated_results)
 
             except AnsibleError as e:
+                failed = True
                 err_msg = to_native(e)
-                raise AnsibleError(err_msg)
 
         if self.return_results_as_name:
             scope = dict()