State Bill of the Month – February 2026: South Carolina S.0519

Introduced by South Carolina Senator Tom Davis and 12 other South Carolina state legislators (R-SC-46), S.0519 would codify a lower tax rate on heated tobacco products (HTPs), setting a statutory tax rate of 5 percent on heated products. This bill was introduced in April 2025 and is currently in the South Carolina Legislature’s Senate Finance Committee, and is scheduled for a hearing on Friday, March 13. While a lower tax rate for reduced-risk products is a significant improvement compared to the high-tax status-quo, heated tobacco products would ideally not be taxed at all.

A traditional cigarette contains over 6,000 ingredients that release 7,000+ chemicals when burned. The negative effects of cigarettes cannot be overstated. Smoking contributes to numerous deaths, diseases, and strains the healthcare system, costing taxpayers billions of dollars each year. Tobacco harm reduction (THR) tools such as heated tobacco products offer a less harmful alternative for Americans trying to quit smoking, providing options that deliver nicotine without the harmful chemicals in combustible cigarettes.

The percentage of Americans smoking traditional cigarettes has consistently declined since the introduction of THR products to the market. Between 2005 and 2021, traditional smoking declined by 45 percent, from 20.9 percent (nearly 21 of every 100 adults) to 11.5 percent (nearly 12 of every 100 adults). From 2007 to 2015, more than three million U.S. adults used THR products to quit smoking cigarettes. A March 9, 2023, CDC report found that in 2021, among American adults currently using e-cigarettes, 40.3 percent had formerly smoked cigarettes.

Unfortunately, lawmakers have been using the popularity of THR products among adults looking to quit smoking to increase excise taxes on THR products. The aim is to raise revenue, especially as state budgets remain increasingly contentious. However, those measures will almost certainly not achieve their stated ends, giving rise to black markets in the process. Legislators should continue to support efforts that promote THR strategies that help adults quit smoking and transition to less harmful alternatives.

S.0519 is a great first step towards reducing regressive taxes on less harmful tobacco products in South Carolina. While TPA would prefer to see no taxation on reduced-risk tobacco products in the Palmetto state, taxing HTPs at a lower rate is critical for encouraging less harmful alternatives.

It is for these reasons, among others, that TPA is pleased to make S.0519, as introduced by South Carolina Senator Tom Davis and others, its Bill of the Month for February 2026.