In this image released on April 16, 2025, Philip Morris launches IQOS, a heated tobacco product, at VENUE in Austin, Texas. IQOS is the first heated tobacco system authorized by the U.S. Food and Drug Administration. (Photo by Chris Saucedo/Getty Images for PMI U.S.)
COLUMBIA — Legislators could cut tobacco taxes in half for an electronic cigarette not yet available in South Carolina stores, while creating a tax on vapes.
Companies have billed both vapes and the heated tobacco products as less dangerous tools to help cigarette smokers quit. Health organizations warn that all nicotine products are harmful.
But opposition from the American Heart Association and the American Cancer Society was not enough to stop a Senate panel from unanimously advancing a proposal Tuesday setting taxes on heated tobacco at half the rate of traditional cigarettes.
The so-called heat-not-burn products aren’t currently sold on South Carolina shelves.
In 2021, Phillip Morris sold heated tobacco products in Charleston and Myrtle Beach as part of the U.S. Food and Drug Administration’s pre-marketing approval. But a patent infringement lawsuit halted their sale later that year, and they’ve yet to return to Palmetto State stores.
In the U.S., the company sells heated tobacco products in Florida, Texas and Mississippi, according to its website.
The number of smokers is dwindling, but SC could do more to stop tobacco usage, report says
They look a lot like vapes but deliver nicotine through actual tobacco instead of a liquid.
Under the bill, which the House approved 93-6 last May, heated tobacco products would be taxed 28.5 cents per pack of 20 — compared to 57 cents per pack of cigarettes.
Senators tacked on a 5-cents-per-milliliter tax to vaping liquid. Under existing law, there is no specific tax on vapes. Since they contain nicotine but no tobacco, they’re not taxed as a tobacco product. Only sales taxes apply.
The bill’s reduced tax on heated tobacco is expected to generate about $7 million annually, according to the state’s financial analysts, who note that will depend on availability. The new tax on vapes would bring in an estimated $14 million annually, with proceeds going to the state’s Medicaid Reserve Fund.
The Senate panel did not take action on a similar bill, filed by Sen. Tom Davis, R-Beaufort, that would have lowered the rate on heated tobacco even further — to just 5% of what’s charged on cigarettes. The reasoning by its Big Tobacco maker is that heated tobacco does 5% percent of the harm.
The FDA allows Phillip Morris to sell its battery-operated IQOS device and the sticks of processed tobacco it heats as a modified risk tobacco product.
That allows the company to claim smokers who fully switch to the product (no longer smoking cigarettes at all) can reduce their exposure to harmful chemicals, according to the Centers for Disease Control and Prevention. It cannot claim the devices reduce risks of tobacco-related diseases. More research is needed, according to the federal agency.
The devices heat the tobacco instead of burning it like a traditional cigarette. The company sales the lower temperature creates a nicotine-laced aerosol, not smoke, with the taste of tobacco.
The nicotine’s delivered with fewer toxins, according to the company. But health advocates and the CDC warn that doesn’t mean the devices are risk free.
“I agree there are probably some deleterious health consequences from the use of heated tobacco products,” Davis said.
“But what essentially we’re dealing with here is an excise tax,” he said, referring to what’s commonly called a “sin tax” when added to items such as alcohol and cigarettes. “The very purpose of an excise tax,” he said, “is to correlate the amount of tax with a degree of harm relative to a common product.”
South Carolina, historically a tobacco-growing state, still has one of the nation’s lowest cigarette taxes, 16 years after legislators passed a 50-cents-per-pack increase.
To do so, they had to override the veto of Davis’ former boss, Gov. Mark Sanford. Legislators succeeded in their second override attempt in three years. The 2010 law marked the first increase in cigarette taxes since 1977.
At 57 cents per pack, the tax ranks fourth lowest. The national average is $2.05 a pack.
As to the claims that heated tobacco products reduce cigarette smoking, public health advocates find fault with studies cited by the tobacco industry. And the products are not approved by the FDA as a way to quit smoking.
Big Tobacco uses international studies from Japan and Europe to argue the products help smokers quit. The studies also show that many people who use them also still smoke traditional cigarettes, though they may reach for them less often.
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Courtesy of South Carolina Daily Gazette
