Grover Norquist, President of Americans for Tax Reform, sent a letter to members of the South Carolina House Ways and Means Committee today, urging them to either oppose or amend House Bill 4074. In its current form, the bill would levy a new tax on e-cigarettes and is a violation of the Taxpayer Protection Pledge. The letter reads as follows:
Dear Members of the Ways and Means Committee,
On behalf of Americans for Tax Reform (ATR) and our members across South Carolina, I write today in opposition to House Bill 4074, legislation which would impose a new tax on vapor products such as e-cigarettes. After the wave of federal taxes that hit your constituents at the beginning of the year, the last thing that South Carolina taxpayers and the state economy need are more job-killing tax increases at the state level.
It is important to be proactive in separating vapor products from "other tobacco products" such as moist snuff and certainly from traditional cigarettes. This reflects the need for tobacco taxation to reflect relative harm. E-cigarettes should never be taxed at the same rate as cigarettes and moist snuff. Carving vapor products out of the OTP designation will insulate them from possible future tobacco tax hikes. However, the new levy that HB 4074 would impose on vapor products is a tax increase that is ill-advised and that the state does not need.
While changing the tax structure to accommodate a new product is important, it must not come at the net expense of taxpayers. For this bill to be compliant with the Taxpayer Protection Pledge – a written commitment that Gov. Haley and many South Carolina legislators have made to their constituents to oppose any and all efforts to raise taxes – the new tax on vapor products must be stripped, or offset with a corresponding tax cut elsewhere. A vote for HB 4074 in its current form will be rated as a vote for higher taxes.
ATR will be following this issue closely and will be educating South Carolina taxpayers on how their representatives in Columbia vote on this important matter.
To view a PDF copy of the letter, click here.