Illinois Administrative Code › Title 86 - REVENUE › Part 660 - TOBACCO PRODUCTS TAX ACT OF 1995 › Section 660.5 - Nature and Rate of Tobacco Products Tax

Current through Register Vol. 48, No. 28, July 12, 2024
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.