Texas Administrative Code › Title 34 - PUBLIC FINANCE › Part 1 - COMPTROLLER OF PUBLIC ACCOUNTS › Chapter 3 - TAX ADMINISTRATION › Subchapter H - CIGAR AND TOBACCO TAX › Section 3.121 - Definitions, Imposition of Tax, Permits, and Reports

Current through Reg. 49, No. 28; July 12, 2024
(a) Definitions. The following words and
				  terms, when used in this section, shall have the following meanings, unless the
				  context clearly indicates otherwise.
(1)
				  Bonded agent--A person in Texas who is a third-party agent of a manufacturer
				  located outside of Texas and who receives tobacco products in interstate
				  commerce and stores the tobacco products for distribution or delivery to
				  distributors under orders from the manufacturer.
(2) Cigar--A roll of fermented tobacco that
				  is wrapped in tobacco and that the main stream of smoke from which produces an
				  alkaline reaction to litmus paper.
(3) Commercial business location--The entire
				  premises occupied by a permit applicant or a person required to hold a permit
				  under Tax Code, Chapter 155 (Cigar and Tobacco Product Tax). A commercial
				  business location does not include a residence or a unit in a public storage
				  facility.
(4) Common carrier--A
				  motor carrier registered under Transportation Code, Chapter 643 (Motor Carrier
				  Registration), or a motor carrier operating under a certificate issued by the
				  Interstate Commerce Commission or its successor agency.
(5) Distributor--A person who:
(A) receives untaxed tobacco products from a
				  manufacturer for the purpose of making a first sale in Texas;
(B) brings or causes to be brought into Texas
				  untaxed tobacco products for sale, use, or consumption;
(C) manufacturers or produces tobacco
				  products; or
(D) is an
				  importer.
(6) Engage in
				  business--A person engaging either directly or through a representative, in any
				  of the following activities:
(A) selling
				  tobacco products in or into this state;
(B) using a warehouse or another location to
				  store tobacco products; or
(C)
				  otherwise conducting through a physical presence tobacco product-related
				  business in this state.
(7) Export warehouse--A person in this state
				  who receives untaxed tobacco products from manufacturers and stores the tobacco
				  products for the purpose of making sales to authorized persons for resale, use,
				  or consumption outside the United States.
(8) Factory list price--The published
				  manufacturer gross cost to the distributor. The term is synonymous with
				  manufacturer's list price.
(9)
				  First sale--Except as otherwise provided by this section, the term means the
				  first transfer of possession in connection with a purchase, sale, or any
				  exchange for value of tobacco products in or into this state, which includes:
(A) the sale of tobacco products by a
				  distributor in or outside this state to a distributor, wholesaler, or retailer
				  in this state; and a manufacturer in this state who transfers the tobacco
				  products in this state; and does not include:
(i) the sale of tobacco products by a
				  manufacturer outside this state to a distributor in this state; or
(ii) the transfer of tobacco products from a
				  manufacturer outside this state to a bonded agent in this state;
(B) the first use or consumption
				  of tobacco products in this state; or
(C) the loss of tobacco products in this
				  state whether through negligence, theft, or other loss.
(10) Importer--A person who ships,
				  transports, or imports into Texas tobacco products manufactured or produced
				  outside the United States for the purpose of making a first sale in this
				  state.
(11) Manufacturer--A person
				  who manufactures, fabricates, or assembles tobacco products, or causes or
				  arranges for the manufacture, fabrication, or assembly of tobacco products, for
				  sale or distribution.
(12)
				  Manufacturer's representative--A person who is employed by a manufacturer to
				  sell or distribute the manufacturer's tobacco products.
(13) Manufacturer's listed net weight--For
				  the purposes of calculating and reporting the state excise tax due on tobacco
				  products other than cigars, the taxable net weight for a tobacco product is the
				  weight of the finished product as shown or listed by the product manufacturer
				  on the product can, package, shipping container, or the report required by Tax
				  Code, §
											155.103(b)
				  (Manufacturer's Records and Reports).
(14) Permit holder--A bonded agent,
				  distributor, importer, export warehouse, manufacturer, wholesaler, or retailer
				  who obtains a permit under Tax Code, §
											155.041(Permits).
(15) Place of business--
(A) a commercial business location where
				  tobacco products are sold;
(B) a
				  commercial business location where tobacco products are kept for sale or
				  consumption or otherwise stored and may not be a residence or a unit in a
				  public storage facility;
(C) a
				  vehicle from which tobacco products are sold; or
(D) a vending machine from which tobacco
				  products are sold.
(16)
				  Raw tobacco--Any part of the tobacco plant, including the tobacco leaf or stem,
				  that is harvested from the ground and is not a tobacco product as the term is
				  defined in this section.
(17)
				  Retailer--A person who engages in the business vending machine.
(18) Tobacco product--A tobacco product is:
(A) a cigar;
(B) smoking tobacco, including granulated,
				  plug-cut, crimp-cut, ready-rubbed, and any form of tobacco substitute for
				  smoking in a pipe or as a cigarette;
(C) chewing tobacco, including, Cavendish,
				  Twist, plug, scrap, and any kind of tobacco suitable for chewing;
(D) snuff or other preparations of pulverized
				  tobacco; or
(E) an article or
				  product that is made of tobacco or a tobacco substitute and that is not a
				  cigarette or an e-cigarette as defined by Health and Safety Code, §
												161.081
				  (Definitions).
(19) Trade
				  discount, special discount, or deals--Includes promotional incentive discounts,
				  quantity purchase incentive discounts, and timely payment or prepayment
				  discounts.
(20) Weight of a
				  cigar--The combined weight of tobacco and nontobacco ingredients that make up
				  the total product in the form available for sale to the consumer, excluding any
				  carton, box, label, or other packaging materials.
(21) Wholesaler--A person, including a
				  manufacturer's representative, who sells or distributes tobacco products in
				  this state for resale but who is not a distributor.