Bill Text: NC S249 | 2011-2012 | Regular Session | Amended
Bill Title: Restore Cigarette Tax Stamps
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2011-03-08 - Ref To Com On Finance [S249 Detail]
Download: North_Carolina-2011-S249-Amended.html
GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2011
S 1
SENATE BILL 249
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Short Title: Restore Cigarette Tax Stamps. |
(Public) |
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Sponsors: |
Senator Hartsell. |
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Referred to: |
Finance. |
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March 8, 2011
A BILL TO BE ENTITLED
AN ACT to improve the enforcement of the cigarette excise tax and to deter the unlawful sale of non‑tax‑paid cigarettes by reinstating the requirement that cigarettes bear a stamp indicating pAYMENT of the tax.
The General Assembly of North Carolina enacts:
SECTION 1. Part 2 of Article 2A of Chapter 105 of the General Statutes is amended by adding a new section to read:
"§ 105‑113.8A. Stamps required on packages of cigarettes.
(a) Requirement. – A package of cigarettes subject to tax in this State must be marked by a heat transfer stamp indicating that the package of cigarettes is taxable under this Article.
(b) Responsibility of Distributor. – It is unlawful for a person that is not a licensed distributor to receive or possess a package of unstamped cigarettes or to place a stamp on a package of cigarettes. A licensed distributor that receives a package of unstamped cigarettes must place a stamp on the package within 48 hours of its receipt, exclusive of Saturdays, Sundays, and legal holidays. A licensed distributor may obtain a cigarette stamp from the Secretary or, with the approval of the Secretary, from the producer of the stamps. A licensed distributor must place a stamp on a package of cigarettes in a manner that ensures the stamp will be torn or mutilated if a person tries to remove the stamp from the package.
(c) Responsibility of Secretary. – The Secretary must prescribe the design, denominations, and other details of a cigarette stamp and must provide for the production of the stamp. A stamp must display a unique serial number that is visible at the point of sale or use. The Secretary must collect the amount due for a stamp when the Secretary transfers, or authorizes the transfer of, the stamp to a licensed distributor. The charge for a tax‑paid stamp is the amount of tax payable under this Article on the package of cigarettes on which the stamp will be placed. The Secretary must keep a record of the stamps transferred to a licensed distributor."
SECTION 2. G.S. 105‑113.9 reads as rewritten:
"§ 105‑113.9. Out‑of‑state shipments.
Any A licensed distributor engaged in
interstate business shall be permitted to may, with the approval of
the Secretary, set aside part of the stock as necessary packages
of cigarettes needed to conduct interstate business without paying the
tax stamping the packages as otherwise required by this Part, but
only if the distributor complies with the requirements prescribed by the
Secretary concerning keeping of records, making of reports, posting of bond,
and other matters for administration of this Part.
"Interstate business" as used in this section means:means
any of the following:
(1) The sale to a nonresident of packages of cigarettes
to a nonresident where the cigarettes are delivered by the distributor delivers
to the business location of the nonresident purchaser in another state;
andstate.
(2) The sale to a nonresident of packages of cigarettes
to a nonresident wholesaler or retailer registered through the Secretary who
has no place of business in North Carolina and who purchases the cigarettes for
the purposes of resale not within this State and where the cigarettes are
delivered to the purchaser at the business location in North Carolina of the
distributor who is also licensed as a distributor under the laws of the state
of the nonresident purchaser.the distributor delivers to another
licensed distributor for subsequent sale outside the State."
SECTION 3. G.S. 105‑113.10 reads as rewritten:
"§ 105‑113.10.
Manufacturers shipping to distributors exempt.In‑State
shipments of manufacturers and other distributors.
Any manufacturer shipping cigarettes to other distributors
who are licensed under G.S. 105‑113.12 may, upon application to the
Secretary and upon compliance with requirements prescribed by the Secretary, be
relieved of paying the taxes levied in this Part. No manufacturer may be
relieved of the requirement to be licensed as a distributor in order to make
shipments, including drop shipments, to a retail dealer or ultimate user.
(a) It is unlawful for a person that is not a licensed distributor to ship an unstamped package of cigarettes into this State or between locations in this State.
(b) A licensed distributor may ship a package of unstamped cigarettes in the following circumstances:
(1) To a facility the distributor owns.
(2) To another licensed distributor.
(3) To a person in a transaction that is not subject to the federal excise tax on cigarettes.
(4) To an agency or an instrumentality of the United States.
(c) A manufacturer delivering cigarettes to another licensed distributor may, upon application to the Secretary and upon compliance with requirements prescribed by the Secretary, be relieved of paying the taxes levied in this Part. In addition to shipments authorized by subsection (b) of this section, a manufacturer may (i) ship unstamped packages of cigarettes directly to a licensed distributor or (ii) deliver unstamped cigarettes to a licensed distributor at the manufacturer's place of business if the manner of delivery or receipt is approved by and reported to the Secretary."
SECTION 4. G.S. 105‑113.18 reads as rewritten:
"§ 105‑113.18. Payment of tax; reports.
The taxes levied in this Part are payable when a report is
required to be filed. The The tax levied in this Part on the sale or
possession of a package of cigarettes by a distributor is payable by means of
the stamp the distributor is required to obtain and place on the package of
cigarettes. The tax levied in this Part on the sale or possession of a package
of cigarettes by a person that is not a distributor is payable when the person
is required to file a report.
The following reports are required to be filed with
the Secretary:Secretary. A report must be in the form required by the
Secretary and contain the information required by the Secretary.
(1) Distributor's Report. – A distributor shall must
file a monthly report in the form prescribed by the Secretary. The
report that covers sales and other activities occurring in a
calendar month and month. The report is due within 20 days after
the end of the month covered by the report. The report shall state the
amount of tax due and shall identify any transactions to which the tax does not
apply.must include the following information:
a. The number of unstamped cigarette packages on hand on the first and last days of the month.
b. The number of unstamped cigarette packages received during the month.
c. The number of unstamped cigarette packages sold during the month.
d. The number of unstamped cigtarettes returned to the manufacturer during the month.
e. The number of stamps on hand on the first and last days of the month.
f. The number of cigarette stamps obtained during the month.
g. All authorized stamp adjustments to be made during the month.
h. The number of cigarette stamps placed on packages of cigarettes during the month.
(1a) Report of Free Cigarettes. – A manufacturer who that
distributes cigarettes without charge shall file a monthly report in the
form prescribed by the Secretary. The report covers cigarettes distributed without
charge in a calendar month and is due within 20 days after the end of the month
covered by the report. The report shall state the number of cigarettes
distributed without charge and the amount of tax due.
(2) Use Tax Report. – Every other person who has
acquired non‑tax‑paid A person that is not a distributor and
that acquires a package of unstamped cigarettes for sale, use, or
consumption subject to the tax imposed by this Part shall, must file
a report within 96 hours after receipt of the cigarettes, file a report
in the form prescribed by the Secretary showing the amount of cigarettes so
received and any other information required by the Secretary. The report shall
be accompanied by payment of the full amount of the tax.receiving the
package of cigarettes. The report must state the number of cigarettes acquired
and the amount of tax due.
(3) Shipping Report. – Any person, except a licensed
distributor, who A person that is not a licensed distributor and that transports
cigarettes upon the public highways, roads, or streets of this State,
State must, upon notice from the Secretary, shall file a report in
the form prescribed by the Secretary and containing the information
required by the Secretary.
(4) Repealed by Session Laws 1981 (Regular Session, 1982), c. 1209, s. 1."
SECTION 5. G.S. 105‑113.21 reads as rewritten:
"§ 105‑113.21. Discount; refund.
(a) Repealed by Session Laws 2003‑284, s. 45A.1(a), effective for reporting periods beginning on or after August 1, 2003.
(a1) Discount. – A distributor is eligible for who
files a timely report under G.S. 105‑113.18 and who sends a timely
payment may deduct from the amount due with the report a discount of two
percent (2%).nine‑tenths of a cent (0.9¢) for every stamp the
distributor purchases. This discount covers the distributor's expenses
incurred in placing stamps on packages of cigarettes, preparing
the records and reports required by this Part, maintaining the
records required by this Part, and the expense of furnishing a bond.
(b) Refund. Refund for Stale Product. –
A distributor in possession of packages of stale or otherwise unsalable
cigarettes upon which the tax has been paid a stamp has been placed may
return the cigarettes to the manufacturer or its designated agent contracted
to dispose of the unsalable cigarettes and apply to the Secretary for a
refund of the tax. The application shall must be in the form
prescribed by the Secretary and shall be accompanied by an affidavit
from the manufacturer stating the number of cigarettes returned to the manufacturer
or its designated agent by the applicant. The Secretary shall must
refund the tax paid, less the discount allowed, on the unsalable
cigarettes.
(c) Refund for Stamps. – A distributor that purchases a stamp is allowed a refund of the amount paid for the stamp, less the discount allowed, in the circumstances listed in this subsection. To obtain a refund, a distributor must apply to the Secretary for the refund. The circumstances are:
(1) When the distributor purchases a stamp that it does not place on a package of cigarettes.
(2) When the distributor purchases a stamp that is torn or otherwise unusable and cannot be placed on a package of cigarettes."
SECTION 6. G.S. 105‑113.27 reads as rewritten:
"§ 105‑113.27.
Non‑tax‑paid Restrictions and presumption concerning cigarettes.
(a) Restrictions. – Except as otherwise
provided in this Article, licensed distributors shall not sell, borrow, loan,
or exchange non‑tax‑paid unstamped cigarettes to,
from, or with other licensed distributors.
(b) No person shall sell or offer for sale
non‑tax‑paid cigarettes.
(c) Presumption. – The possession of more than six hundred cigarettes on which tax has been paid to another state or country, by any person other than a licensed distributor, is prima facie evidence that the cigarettes are possessed in violation of this Part."
SECTION 7. G.S. 105‑113.33 reads as rewritten:
"§ 105‑113.33. Criminal penalties.
Any person who violates any of the provisions a
provision of this Article for which no other punishment is specifically
prescribed shall be is guilty of a Class 1 misdemeanor. A
person who forges a stamp required under this Article or who knowingly places a
forged stamp on a package of cigarettes is guilty of a Class H felony."
SECTION 8. A distributor that has unstamped cigarettes on hand on the effective date of this act must stamp the cigarettes as required by this act within 48 hours of the effective date.
SECTION 9. This act becomes effective July 1, 2011.
