Bill Text: NJ A3278 | 2012-2013 | Regular Session | Introduced
Bill Title: Increases civil and criminal penalties involving unstamped and counterfeit cigarettes and cigarette smuggling and establishes crime involving transfers of counterfeit cigarettes.*
Spectrum: Bipartisan Bill
Status: (Introduced - Dead) 2013-06-20 - Substituted by S2516 (2R) [A3278 Detail]
Download: New_Jersey-2012-A3278-Introduced.html
Sponsored by:
Assemblywoman AMY H. HANDLIN
District 13 (Monmouth)
SYNOPSIS
Increases civil and criminal penalties concerning activities involving untaxed cigarettes and cigarette smuggling.
CURRENT VERSION OF TEXT
As introduced.
An Act increasing civil and criminal penalties concerning activities involving untaxed cigarettes and cigarette smuggling, amending various parts of statutory law.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 601 of P.L.1948, c.65 (C.54:40A-24) is amended to read as follows:
601. a. Penalties. Any person who shall engage in any business or activity for which a license is required under the provisions of this act, without first having obtained a license to do so, or who, having had such a license, shall continue to engage in or conduct such business after any such license shall have been revoked, or during a suspension thereof, shall be liable to a penalty of not more than [$250.00] $500, which penalty shall be sued for, and shall be recoverable in the name of the director; and each day that any such business is so engaged in or conducted shall be deemed a separate offense.
b. Jurisdiction of court; proceedings. The Superior Court and every municipal court within their respective jurisdictions, and with respect to offenses occurring within the territorial jurisdiction of the court, shall have jurisdiction over proceedings to enforce and collect the penalty. The proceedings shall be brought by and in the name of the director. They shall be summary and in accordance with "the penalty enforcement law" (N.J.S.2A:58-1 et seq.). Process shall be either in the nature of a summons or warrant.
If judgment be rendered for the plaintiff, the court shall cause any defendant who refuses or fails to pay forthwith the amount of the judgment rendered against him and all the costs and charges incident thereto, to be committed to the county jail for such period as the court shall determine, not exceeding [30] 60 days.
c. Penalty for further violations; recovery; proceedings in court. In case a person shall, after conviction of any violation of this act, be again convicted of violating the same provision thereof, he may be liable to a penalty for such further violation, in double the maximum penalty which might have been imposed on the first conviction, to be sued for and recovered in the manner above set forth. In case any defendant against whom judgment has been rendered for a money penalty under this subsection, shall fail or neglect to pay forthwith the amount of said penalty, the court shall commit him to jail for such number of days not exceeding [90] 180 days, as the court shall determine.
d. Disposition of penalties. All penalties recovered for violations of this act shall be paid to the director and by him accounted for and paid to the State Treasurer as in the case of State taxes.
e. Costs; expenses. The costs recoverable in any such proceeding shall be recovered by the director in the event of judgment in his favor. If the judgment be for the defendant it shall be without costs against the director. All expenses incident to the recovery of any penalty pursuant to the provisions of this section shall be paid for as any other expense incident to the administration of this act.
(cf: P.L.1991, c.91, s.515)
2. Section 10 of P.L.1968, c.351 (C.54:40A-24.1) is amended to read as follows:
10. Any manufacturer's representative, as defined in this act, who sells or exchanges cigarettes other than those of his employer's manufacture shall be liable to a penalty of not more than [$250.00] $500 for each separate offense.
(cf: P.L.1968, c.351, s.10).
3. Section 602 of P.L.1948, c.65 (C.54:40A-25) is amended to read as follows:
602. Possessing cigarettes not bearing required revenue stamps.
Any wholesale dealer or retail dealer who violates the provisions of section four hundred six of this act, and any consumer who fails to report and remit the tax due as provided by section two hundred five of this act, shall be liable to a penalty of not more than [two-hundred and fifty dollars ($250)] $500 for each individual carton of unstamped or illegally stamped cigarettes in the dealer's possession, which penalty shall be sued for and recovered in the same manner as provided for the penalties imposed by section six hundred one of this act.
(cf: P.L. 2011, c.80, s.3)
4. Section 603 of P.L.1948, c.65 (C.54:40A-26) is amended to read as follows:
603. Any person engaged in the business of manufacturing, purchasing, selling, consigning, shipping, distributing, or transporting cigarettes, who shall refuse or fail to produce, on demand by the director, invoices of all cigarettes purchased or received by him within three years prior to such demand, unless his inability to do so for reasons beyond his control shall be shown by satisfactory proof, shall be liable to a penalty of not more than [two hundred fifty dollars ($250.00)] $500 for each separate offense.
(cf: P.L.1951, c.281, s.3)
5. Section 604 of P.L.1948, c. 65 (C.54:40A-27) is amended to read as follows:
604. Any person who prevents or hinders the director or any designated assistant from making a cigarette inventory, examination and full inspection of any place where cigarettes are sold or stored, or prevents or hinders the inspection of invoices, books, records, or papers required to be kept, shall be liable to a penalty of not more than [$250.00] $500 for each individual offense.
(cf: P.L.1968, c.351, s.6)
6. Section 605 of P.L.1948, c.65 (C.54:40A-28) is amended to read as follows:
605. Any person who sells cigarettes without the stamp or stamps required by this act being affixed thereto or cigarettes stamped in violation of subsection b. of section 405 of P.L.1948, c.65 (C.54:40A-15) shall be guilty of a [misdemeanor and, upon conviction thereof, shall be fined not more than $1,000, or imprisoned for not more than one year, or both, at the discretion of the court] crime of the third degree.
(cf: P.L.1999, c.328, s.4)
7. Section 2 of P. L.1977, c.188 (C.54:40A-28.1) is amended to read as follows:
2. Any person, other than a licensee permitted under this act to possess any unstamped cigarettes, who possesses 2,000 but fewer than 20,000 cigarettes without the stamp or stamps required by this act being affixed thereto or stamped in violation of subsection b. of section 405 shall be [a disorderly person, and upon conviction thereof, shall be fined not more than $500 or imprisoned for not more than six months, or both, at the discretion of the court] guilty of a crime of the fourth degree; and any such person who possesses 20,000 or more cigarettes without the stamp or stamps required by this act being affixed thereto or stamped in violation of subsection b. of section 405 of P.L.1948, c.65 (C.54:40A-15) shall be guilty of a [misdemeanor, and upon conviction thereof, shall be fined not more than $1,000 or imprisoned for not more than one year, or both, at the discretion of the court] crime of the third degree.
(P.L.1999, c.328, s.5)
8. Section 609 of P.L.1948, c.65 (C.54:40A-32) is amended to read as follows:
609. Records; possession and transportation of unstamped cigarettes; seizure and confiscation of vessel or vehicles. Every person who shall transport cigarettes not stamped as required by this act or stamped in violation of subsection b. of section 405 of P.L.1948, c.65 (C.54:40A-15) upon the public highways, waterways, roads or streets of this State shall have in his actual possession invoices or delivery tickets for such cigarettes which shall show the true name and complete and exact address of the consignor or seller, the true name and complete and exact address of the consignee or purchaser, the quantity and brands of the cigarettes transported and in addition shall show separately the true name and complete and exact address of the person who has or shall assume the payment of the New Jersey State tax or the tax, if any, of the State or foreign country at the point of ultimate destination, provided that any common carrier which has issued a bill of lading for a shipment of cigarettes and is without notice to itself or to any of its agents or employees that said cigarettes are not stamped as required by this act shall be deemed to have complied with this act and the vehicle or vessel in which said cigarettes are being transported shall not be subject to confiscation hereunder. In the absence of such invoices, delivery tickets or bills of lading, as the case may be, the cigarettes so transported, the vehicle, or vessel in which the cigarettes are being transported and any paraphernalia or devices used in connection with the unstamped cigarettes or cigarettes stamped in violation of subsection b. of section 405 of P.L.1948, c.65 (C.54:40A-15), are declared to be contraband goods and may be seized by the director, his agents or employees or by any peace officer of the State when directed by the director, his agents or employees so to do, without a warrant. The director shall immediately thereafter institute a proceeding for the confiscation thereof in the Superior Court or the municipal court within the jurisdiction of which the seizure is made. The owner or any person having a security interest in any such vehicle may secure release of the same by depositing with the clerk of the court, in which such proceeding is pending, a bond with good and sufficient sureties in an amount to be fixed by the court, conditioned upon the return of said vehicle to the director upon demand after completion of said proceeding. The court may proceed in a summary manner and may direct confiscation to the director; provided, however, anything to the contrary notwithstanding, that the owner or any person claiming to be the holder of a mortgage, conditional sales contract or other security interest in any vehicle or vessel, the disposition of which is provided for above, may present his petition so alleging and be heard, and in the event it appears to the court that the property was unlawfully used by a person other than the owner or such claimant, and if such owner or claimant acquired ownership or his security interest in good faith and without knowledge that the vehicle or vessel was going to be so used, the court shall either waive forfeiture in favor of such owner or claimant and order the vehicle or vessel returned or delivered to such owner or claimant, or if it is found that the value thereof exceeds the amount of the claim, the court shall order payment of the amount of the claim out of the proceeds of the sale. Every transporter who violates the provisions of this act [is a disorderly person] shall be guilty of a crime of the fourth degree, and shall, in addition to such penalties as [attached thereto] may be imposed therefore, be liable to a penalty equal to double the amount of tax due on any unstamped cigarettes transported by him, which penalty shall be sued for and recovered in the same manner as provided for the penalties imposed by section 601 of the act to which this act is amendatory (C.54:40A-24).
(cf: P.L.1999, c.328, s.9)
9. Section 9 of P.L.1968, c.351 (C.54:40A-32.1) is amended to read as follows:
9. Any cigarette vending machine not bearing a proper license or identification, or which is found to contain unstamped packages of cigarettes, or cigarettes bearing counterfeit impressions, or cigarettes stamped in violation of subsection b. of section 405 of P.L.1948, c.65 (C.54:40A-15), may be seized or sealed by the director, the director's agents or employees or by any peace officer of this State, when directed by the director so to do. If the owner or the owner's agent destroys or removes said seal, that individual may, upon conviction, be subject to a penalty of not more than [$250] $500. Any vending machine containing unstamped or counterfeit stamped cigarettes may be declared forfeited to the director.
(cf: P.L.1999, c.328, s.7)
10. Section 6 of P.L.1950, c.134 (C.54:40A-44) is amended to read as follows:
6. No radio or television broadcast originating in this State, or newspaper, or other publication published in this State, shall accept an advertisement from any out-of-State cigarette dealer for the sale of cigarettes by mail or express, unless there is included in said advertisement the following words: "Before any person may receive cigarettes in New Jersey by mail or express, a license for that purpose must be obtained from the Division of Taxation, New Jersey Department of the Treasury."
Any person who violates these provisions, upon conviction thereof, shall be fined not more than [five hundred dollars ($500.00)] $1,000 for each individual offense.
(cf: P.L.1950, c.134, s.6)
11. Section 5 of P.L.2005, c.85 (C.54:40A-50) is amended to read as follows:
5. In addition to any other remedies provided by law, the Director of the Division of Taxation in the Department of the Treasury shall assess penalties for violations of this act in accordance with the following schedule:
a. a penalty of not less than [$1,000] $2,000 and not more than [$2,000] $4,000 for the first violation;
b. a penalty of not less than [$2,500] $5,000 and not more than [$3,500] $7,000 for the second violation within a five-year period;
c. a penalty of not less than [$4,000] $8,000 and not more than [$5,000] $10,000 for the third violation within a five-year period;
d. a penalty of not less than [$5,500] $11,000 and not more than [$6,500] $13,000 for a fourth violation within a five-year period; and
e. a penalty of [$10,000] $20,000 for a fifth or subsequent violation within a five-year period.
(cf: P.L.2005, c.85, s.5)
12. This act shall take effect immediately.
STATEMENT
This bill increases certain fines, county jail maximum sentences and the grading of certain criminal offenses that are imposed under the Cigarette Tax Act for illegal cigarette smuggling. State cigarette tax payments are demonstrated by appropriate New Jersey stamped cigarettes packs. New Jersey residents are not permitted to possess or consume untaxed, improperly stamped or unstamped cigarettes. Criminal and civil statutes apply in both circumstances, and unstamped and improperly stamped cigarettes are prima facie contraband under the New Jersey Criminal Code.
New Jersey has had a long history of cigarette smuggling problems and has experienced challenges enforcing the cigarette tax law against both casual smuggling by individual smokers for their own use, and against larger scale commercial smuggling that tends to involve organized criminal organizations.
The enhancement of civil and criminal penalties is intended to establish a stronger deterrent effect against the commission of certain offenses that are typically violated in cigarette smuggling efforts. These offenses may include: conducting certain licensed activities without a license, transfers of off-brand cigarettes by manufacturers representatives, possessing unstamped cigarettes, refusal to produce business records by those engaging in any stage of commerce in cigarettes, hindering or preventing the administration of the Cigarette Tax Act, sale of cigarettes without required tax stamps, possession of large quantities of unstamped cigarettes, transportation of unstamped cigarettes, maintaining unlicensed vending machines and vending machines containing unstamped or counterfeit stamped cigarettes, advertising in this State by out-of-state cigarette dealers of the sale of cigarettes by mail or express, and violations of the Cigarette Sales Act regulating the collection of taxes on retail sales of cigarettes shipped from outside this State. Several civil penalties for these offenses are doubled, certain maximum county jail terms are doubled, and certain criminal offenses under the Cigarette Tax Act are increased in degree which will result in longer sentences of incarceration and higher fines being imposed.
