Revenue Vaped
Texas Vape Ban: How Much Revenue Will SB 2024 Cost the State?
Posted on August 31, 2025
Texas’s new vape law, Senate Bill 2024 (SB 2024), is set to shake up the vaping and hemp industries by banning a wide range of products starting September 1, 2025. From hemp-derived cannabinoid vapes to Chinese-made disposables, the law targets products deemed risky for minors or environmentally harmful. While the intent is to protect public health, the economic fallout could be massive. So, how much revenue might Texas lose? Let’s break it down.
What Does SB 2024 Ban?
SB 2024 isn’t a total vape ban, but it’s close. Here’s what’s affected:
- Hemp-derived cannabinoid vapes: Products containing Delta-8, Delta-9, CBD, or other hemp-based compounds are banned, except for limited medical use under the Texas Compassionate Use Program (TCUP).
- Chinese-made prefilled vapes: Any disposable vape manufactured in China or other “foreign adversary” countries is prohibited.
- Youth-targeted products: Vapes with child-appealing designs or disguised as everyday items (e.g., pens) are out.
Refillable devices and U.S.-made nicotine vapes can still be sold, but the restrictions hit a huge chunk of the market, especially disposables and hemp products.
The Economic Impact: A Multi-Billion Dollar Hit?
Based on industry estimates, Texas could lose $1.5–2 billion in annual retail revenue from vape sales due to SB 2024, including $124–165 million in sales tax revenue.
Here’s how we got those numbers:
1. Hemp-Derived Vape Market
Texas’s hemp industry is an $8 billion juggernaut, and vapes (along with concentrates) make up about 30–35% of that, according to retailers like The Glass House TX. That’s roughly $2.4 billion in vape sales. With SB 2024 banning most hemp vapes, the state could lose $1.2–1.68 billion annually, assuming some consumers switch to legal alternatives like edibles.
2. Nicotine Vape Market
The national vaping market was worth $7.4 billion in 2024, with Texas likely contributing around $666 million. Since 80–90% of disposable vapes are Chinese-made, banning them could cost Texas about $283 million in sales, assuming half of those consumers don’t switch to U.S.-made options.
3. Tax Revenue
With Texas’s sales tax rate averaging 8.25%, the state could lose $124–165 million in tax revenue from the $1.5–2 billion drop in sales. This doesn’t include additional losses from business taxes or job cuts, which could ripple through the economy.
What’s at Stake for Businesses and Consumers?
Texas has thousands of vape shops and hemp dispensaries, many of which rely on banned products for a third or more of their revenue. Small businesses could close, and jobs—potentially tens of thousands in the hemp industry alone—may disappear. Consumers might turn to online retailers or black markets, which could undermine the law’s goals and reduce taxable sales further.
Some companies are already pivoting, moving manufacturing to countries like Vietnam or focusing on edibles. But the transition won’t be easy, especially for small retailers competing with big players like Altria (maker of NJOY), who stand to gain from the ban.
The Bigger Picture
Supporters of SB 2024 argue it protects kids from addictive products and reduces e-waste from disposables. Critics, however, see it as a win for big tobacco and medical cannabis companies, squeezing out small businesses and limiting consumer choice. The law’s passage with little public input has also raised eyebrows, hinting at potential legal challenges or enforcement issues.
While the exact revenue loss depends on how businesses and consumers adapt, one thing’s clear: SB 2024 will hit Texas’s economy hard. Will the public health benefits outweigh the costs? Only time will tell.
Note: These estimates are based on limited public data and industry insights. For updates on SB 2024’s impact, check back after September 2025 or follow discussions on X.
What do you think about the vape ban? Share your thoughts in the comments or on X!
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