The Tobacco Products Tax Act of 1995 imposes a tax on any
person in business as a distributor of tobacco products. The tax is based on
the wholesale price of tobacco products sold or otherwise disposed of to
distributors located in Illinois, except moist snuff sold or otherwise disposed
of on or after January 1, 2013 and little cigars sold or otherwise disposed of
on or after July 1, 2013. Beginning January 1, 2013, under the Act, moist snuff
is taxed by the ounce and all fractional parts of an ounce. Beginning July 1,
2013, little cigars are taxed under the Act at the same rate as cigarettes.
Little cigars in packages of 20 or 25 little cigars sold by stamping
distributors must have a tax stamp affixed. Stamping distributors must purchase
tax stamps from the Department in same manner as licensed cigarette
distributors purchase tax stamps that are affixed to packages of cigarettes.
The same tax stamps are affixed to packages of little cigars and cigarettes
containing 20 or 25 little cigars or cigarettes. Taxes on packages of little
cigars containing other than 20 or 25 little cigars are reported on a return to
be filed no later than the 15th of the month and
paid on or before the date the return is due.
a) Except as otherwise provided in this
Section with respect to moist snuff, electronic cigarettes, and little cigars,
the Tobacco Products Tax is imposed upon the last distributor, as defined in
Section
660.10,
who sells tobacco products to a retailer or consumer located in Illinois at the
rate of 18% of the wholesale price of tobacco products sold or otherwise
disposed of in this State
prior to July 1, 2012 and 36% of the
wholesale price of tobacco products sold or otherwise disposed of to retailers
or consumers located in this State beginning on July 1, 2012. Beginning on
January 1, 2013, the tax on moist snuff shall be imposed at a rate of $0.30 per
ounce, and a proportionate tax at the like rate on all fractional parts of an
ounce, sold or otherwise disposed of to retailers or consumers located in this
State, provided that
the rate of tax imposed on moist
snuff after any future rate increases
may not exceed 15% of
the tax imposed upon a package of 20 cigarettes pursuant to the Cigarette Tax
Act [35 ILCS 130]
. Beginning July 1, 2013, the tax on little
cigars shall be imposed at the same rate, and the proceeds shall be distributed
in the same manner as the tax imposed on cigarettes under the Cigarette Tax
Act. Beginning July 1, 2013, and prior to July 1, 2019, the tax on
little cigars is 99 mills per little cigar sold or otherwise disposed of.
Beginning July 1, 2019, the tax on little cigars is 149 mills per little cigar
sold or otherwise disposed of.
Beginning July 1, 2019, the tax on
electronic cigarettes shall be at the rate of 15% of the wholesale price of
electronic cigarettes sold or otherwise disposed of to retailers or consumers
located in this State. [
35 ILCS
143/10-10]
b)
The tax is in addition to all
other occupation or privilege taxes imposed by the State of Illinois, by any
political subdivision thereof, or by any municipal corporation
[35 ILCS
143/10-10(a)].
c) A retailer is required to register as a
distributor, file returns and pay the Tobacco Products Tax imposed by the Act
on all sales of tobacco products on which the tax has not been paid unless the
sales are exempt under Section
660.30.
(See Sections
660.15,
660.20
and 660.30.)
Retailers that are not stamping distributors shall
purchase stamped packages of little cigars containing 20 or 25 little cigars
for resale only from stamping distributors, distributors, or wholesalers.
Retailers who are not stamping distributors may not purchase or possess
unstamped packages of little cigars containing 20 or 25 little cigars.
Retailers who are not stamping distributors may not purchase or possess
packages of little cigars containing other than 20 or 25 little cigars, unless
the retailer receives an invoice from a stamping distributor, distributor, or
wholesaler stating the tax on the packages has been or will be paid.
[
35
ILCS 143/10-27] (See Section
660.28.)
d) The Tobacco Products Tax is paid on the
wholesale price of tobacco products, except on moist snuff and little cigars.
The wholesale price is the established list price for which a manufacturer
sells tobacco products to a distributor, or the established list price for
which a wholesaler or distributor sells tobacco products to the last
distributor, before the allowance of any discounts, trade allowances, rebates
or other reductions. Surcharges added by manufacturers or distributors are
considered part of the wholesale price subject to tax.
1) The wholesale price for purposes of
imposing the Tobacco Products Tax on the last distributor is the invoice price
at which tobacco products are sold by a wholesaler or distributor to the last
distributor before the allowance of any discounts, trade allowances, rebates or
other reductions. Surcharges added by distributors are considered part of the
wholesale price subject to tax.
2)
The wholesale price for purposes of imposing the tax on a retailer who receives
or purchases tobacco products on which the tax has not been paid or will not be
paid by a licensed distributor is the invoice price paid by the retailer to an
unlicensed distributor or other supplier of tobacco products before the
allowance of any discounts, trade allowances, rebates or other reductions.
Surcharges added by manufacturers, distributors or other suppliers are
considered part of the wholesale price subject to tax.
3) The wholesale price for purposes of
imposing tax on a manufacturer of a tobacco product who sells the tobacco
product directly to consumers is the cost to the manufacturer to manufacture
the tobacco product. When determining its cost, the time period used for
purpose of the study should be long enough to include all costs incurred by the
manufacturer to manufacture the product.
e) Whenever any sales invoice issued by a
supplier to a retailer for tobacco products sold to the retailer does not
comply with the requirements of Section
660.25(d),
(e) and (g), a prima facie presumption shall
arise that the tax imposed by Section 10-10 of the Act and this Section has not
been paid on the tobacco products listed on the sales invoice. A retailer that
is unable to rebut this presumption is in violation of both the Act and this
Part and is subject to applicable tax, penalties, and interest.
f)
Beginning July 1, 2013,
all moneys received by the Department under the Act from the tax
imposed on little cigars shall be distributed as provided in Section 2
of the Cigarette Tax Act [35 ILCS
143/10-10].