Illinois Administrative Code › Title 86 - REVENUE › Part 450 - CIGARETTE USE TAX ACT › Section 450.30 - Licenses and Permits - Bonds

Current through Register Vol. 48, No. 28, July 12, 2024
a) Any
			 distributor maintaining a place of business in this State is required to be
			 licensed as a distributor under the Act, provided that the distributor need not
			 obtain the license if a distributor is required to procure a license or allowed
			 to obtain a permit as a distributor under the Cigarette Tax Act.
"Distributor maintaining a place of business in this State" means any
			 distributor having or maintaining within this State, directly or by a
			 subsidiary, an office, distribution house, sales house, warehouse or other
			 place of business, or any agent operating within this State under the authority
			 of the distributor or its subsidiary, irrespective of whether the place of
			 business or agent is located here permanently or temporarily, or whether the
			 distributor or subsidiary is licensed to transact business within this
			 State.
(Section 1 of the Act) The distributor must apply for a license
			 on a form prescribed by the Department and must accompany the application with
			 a joint and several bond. The amount of the bond shall be $2,500.
b) Except when the applicant is the
			 manufacturer, no distributor's license shall be issued to an applicant unless
			 he or she presents the Department with satisfactory proof in writing that he or
			 she will be able to buy cigarettes directly from at least 3 major cigarette
			 manufacturers. A separate application for license shall be made, and bond
			 filed, for each place of business at or from which the applicant proposes to
			 act as a distributor under the Act and for which the applicant is not required
			 to procure a license or allowed to obtain a permit as a distributor under the
			 Cigarette Tax Act. Any license issued shall permit the applicant to engage in
			 business as a distributor at or from the place shown in his or her application.
			 All licenses issued by the Department under the Act shall be valid for not to
			 exceed one year after issuance unless sooner revoked, canceled or suspended as
			 provided in the Act.
c) The annual
			 license fee payable to the Department for each distributor's license shall be
			 $250. The purpose of the annual license fee is to defray the cost, to the
			 Department, of serializing cigarette tax stamps. The applicant for license
			 shall pay the fee to the Department at the time of submitting the application
			 for license to the Department.
d) A
			 license shall not be transferable or assignable. Every such license shall be
			 conspicuously displayed at the place of business for which it is issued.
			 Licenses issued under the Act are subject to suspension, revocation or
			 cancellation under the conditions prescribed in Section 6 of the Act.
e) The Department may, in its discretion,
			 upon application, issue permits authorizing the collection of the tax imposed
			 by those out-of-state cigarette manufacturers who are not required to be
			 licensed as distributors of cigarettes in this State, but who elect to qualify
			 under this Act as distributors of cigarettes in this State, and who, to the
			 satisfaction of the Department, furnish adequate security to insure collection
			 and payment of the tax, provided that any permit shall extend only to
			 cigarettes that the permittee-manufacturer places in original packages that are
			 contained inside a sealed transparent wrapper, and provided that no permit
			 shall be issued under the Act to a manufacturer who has obtained the permit
			 provided for in Section 4b of the Cigarette Tax Act. The distributor shall be
			 issued, without charge, a permit to collect the tax in a manner, and subject to
			 reasonable regulations and agreements as the Department shall prescribe. When
			 so authorized, it shall be the duty of the distributor to collect the tax upon
			 all cigarettes he or she delivers (or causes to be delivered) within this State
			 to purchasers, in the same manner and subject to the same requirements as a
			 distributor maintaining a place of business within this State. The permit shall
			 be in the form the Department may prescribe and shall not be transferable or
			 assignable. The authority and permit may be suspended, canceled or revoked
			 when, at any time, the Department considers that the security given is
			 inadequate, or that the tax can more effectively be collected from the person
			 using the cigarettes in this State or through distributors located in this
			 State, or whenever the permittee violates any provision of the Act or this
			 Part, or whenever the permittee shall notify the Department in writing of his
			 or her desire to have the permit canceled. The Department shall have the power,
			 in its discretion, to issue a new permit after the suspension, cancellation or
			 revocation.
f) All permits issued
			 by the Department under the Act shall be valid for not to exceed one year after
			 issuance unless sooner revoked, canceled or suspended, as provided in the
			 Act.
g)
The following are
			 ineligible to receive a distributor's license or permit under the Act:
1)
A person who is not of good
			 character and reputation in the community in which he or she
			 resides;
2)
a
			 person who has been convicted of a felony under any federal or State law, if
			 the Department, after investigation and a hearing, if requested by the
			 applicant, determines that the person has not been sufficiently rehabilitated
			 to warrant the public trust;
3)
a corporation, if any officer,
			 manager or director thereof, or any stockholder or stockholders owning in the
			 aggregate more than 5% of the stock of the corporation, would not be eligible
			 to receive a license
under this Part
for any
			 reason.
4)
a
			 person, or any person who owns more than 15 percent of the ownership interests
			 in a person or a related party who:
A)
owes, at the time of application,
			 any delinquent cigarette taxes that have been determined by law to be due and
			 unpaid, unless the license applicant has entered into an agreement approved by
			 the Department to pay the amount due;
B)
had a license under the Act
			 revoked within the past 2 years by the Department for misconduct relating to
			 stolen or contraband cigarettes or has been convicted of a State or federal
			 crime, punishable by imprisonment of one year or more, relating to stolen or
			 contraband cigarettes;
C)
manufactures cigarettes, whether in this State or out of this State,
			 and who is neither:
i)
a
			 participating manufacturer as defined in subsection II(jj) of the "Master
			 Settlement Agreement" as defined in Section 10 of the Tobacco Products
			 Manufacturers' Escrow Act
[ 30 ILCS 168 ]
;
			 nor
ii)
in full
			 compliance with the Tobacco Products Manufacturers' Escrow Act and the Tobacco
			 Products Manufacturers' Escrow Enforcement Act of 2003
[ 30 ILCS 167
			 ];
D)
has been
			 found by the Department, after notice and a hearing, to have imported or caused
			 to be imported into the United States for sale or distribution any cigarette in
			 violation of
			 19
			 USC 1681a;
E)
has been found by the Department,
			 after notice and a hearing, to have imported or caused to be imported into the
			 United States for sale or distribution or manufactured for sale or distribution
			 in the United States any cigarette that does not fully comply with the Federal
			 Cigarette Labeling and Advertising Act
(
			 15 USC
			 1331 )
; or
F)
has been found by the Department,
			 after notice and a hearing, to have made a material false statement in the
			 application or has failed to produce records required to be maintained by the
			 Act.
(Section 4 of the Cigarette Use Tax Act)