From Chapter 1:
Every one knows the legend of the water (or beer) thrown over Sir Walter by his servant when he first saw his master smoking, and imagined he was on fire. The story was first associated with Raleigh by a writer in 1708 in a magazine called the British Apollo. According to this yarn Sir Walter usually "indulged himself in Smoaking secretly, two pipes a Day; at which time, he order'd a Simple Fellow, who waited, to bring him up a Tankard of old Ale and Nutmeg, always laying aside the Pipe, when he heard his servant coming." On this particular occasion, however, the pipe was not laid aside in time, and the "Simple Fellow," imagining his master was on fire, as he saw the smoke issuing from his mouth, promptly put the fire out by sousing him with the contents of the tankard. One difficulty about this story is the alleged secrecy of Raleigh's indulgence in tobacco. There seems to be no imaginable reason why he should not have smoked openly. Later versions turn the ale into water and otherwise vary the story.

From Chapter 7:
It seems to have been taken for granted that country parsons smoked. smoking was universal among their male parishioners from the squire to the labourer (when he could afford it), so that it was only natural that the parson, with little to do, and in those days not too much inclination to do it, should be as fond of his pipe as the rest of the world around him. In a World of 1756 there is an account of a country gentleman entertaining one evening the vicar of the parish, and the host as a matter of course proceeds to order a bottle of wine with pipes and tobacco to be placed on the table. The vicar forthwith "filled his pipe, and drank very cordially to my friend," his host. One cannot doubt that Laurence Sterne, that most remarkable of country parsons, smoked. His "My Uncle Toby" is among the immortals, and Toby without his pipe is unimaginable.