SF 1211

as introduced - 79th Legislature (1995 - 1996) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to taxation; increasing the rate of taxes on 
  1.3             cigarettes and tobacco products; dedicating the 
  1.4             increased revenues to the health care access fund; 
  1.5             amending Minnesota Statutes 1994, sections 297.02, 
  1.6             subdivision 1; 297.03, subdivision 5; 297.13, 
  1.7             subdivision 1; and 297.32, subdivisions 1, 2, and 9. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  Minnesota Statutes 1994, section 297.02, 
  1.10  subdivision 1, is amended to read: 
  1.11     Subdivision 1.  [RATES.] A tax is hereby imposed upon the 
  1.12  sale of cigarettes in this state or having cigarettes in 
  1.13  possession in this state with intent to sell and upon any person 
  1.14  engaged in business as a distributor thereof, at the following 
  1.15  rates, subject to the discount provided in section 297.03: 
  1.16     (1) On cigarettes weighing not more than three pounds per 
  1.17  thousand, 24 44 mills on each such cigarette; 
  1.18     (2) On cigarettes weighing more than three pounds per 
  1.19  thousand, 48 88 mills on each such cigarette. 
  1.20     Sec. 2.  Minnesota Statutes 1994, section 297.03, 
  1.21  subdivision 5, is amended to read: 
  1.22     Subd. 5.  [SALE OF STAMPS.] The commissioner shall sell 
  1.23  stamps to any person licensed as a distributor at a discount of 
  1.24  1.0 ...  percent from the face amount of the stamps for the 
  1.25  first $1,500,000 of such stamps purchased in any fiscal year; 
  1.26  and at a discount of .60 ... percent on the remainder of such 
  2.1   stamps purchased in any fiscal year.  The commissioner shall not 
  2.2   sell stamps to any other person.  The commissioner may prescribe 
  2.3   the method of shipment of the stamps to the distributor as well 
  2.4   as the quantities of stamps purchased.  
  2.5      Sec. 3.  Minnesota Statutes 1994, section 297.13, 
  2.6   subdivision 1, is amended to read: 
  2.7      Subdivision 1.  [CIGARETTE TAX APPORTIONMENT.] Revenues 
  2.8   received from taxes, penalties, and interest under sections 
  2.9   297.01 to 297.13 and from license fees and miscellaneous sources 
  2.10  of revenue shall be deposited by the commissioner of revenue in 
  2.11  the state treasury and credited as follows:  
  2.12     (a) first to the general obligation special tax bond debt 
  2.13  service account in each fiscal year the amount required to 
  2.14  increase the balance on hand in the account on each December 1 
  2.15  to an amount equal to the full amount of principal and interest 
  2.16  to come due on all outstanding bonds whose debt service is 
  2.17  payable primarily from the proceeds of the tax to and including 
  2.18  the second following July 1; and 
  2.19     (b) after the requirements of paragraph (a) have been met: 
  2.20     (1) the revenue produced by one mill of the tax on 
  2.21  cigarettes weighing not more than three pounds a thousand and 
  2.22  two mills of the tax on cigarettes weighing more than three 
  2.23  pounds a thousand must be credited to the Minnesota future 
  2.24  resources fund; 
  2.25     (2) for sales after June 30, 1995, the revenue produced by 
  2.26  20 mills of the tax on cigarettes weighing not more than three 
  2.27  pounds a thousand and 40 mills on cigarettes weighing more than 
  2.28  three pounds a thousand must be credited to the health care 
  2.29  access fund in the state treasury; and 
  2.30     (3) the balance of the revenues derived from taxes, 
  2.31  penalties, and interest under sections 297.01 to 297.13 and from 
  2.32  license fees and miscellaneous sources of revenue shall be 
  2.33  credited to the general fund. 
  2.34     Sec. 4.  Minnesota Statutes 1994, section 297.32, 
  2.35  subdivision 1, is amended to read: 
  2.36     Subdivision 1.  A tax is hereby imposed upon all tobacco 
  3.1   products in this state and upon any person engaged in business 
  3.2   as a distributor thereof, at the rate of 35 65 percent of the 
  3.3   wholesale sales price of such tobacco products.  Such tax shall 
  3.4   be imposed at the time the distributor (1) brings, or causes to 
  3.5   be brought, into this state from without the state tobacco 
  3.6   products for sale; (2) makes, manufactures, or fabricates 
  3.7   tobacco products in this state for sale in this state; or (3) 
  3.8   ships or transports tobacco products to retailers in this state, 
  3.9   to be sold by those retailers.  
  3.10     Sec. 5.  Minnesota Statutes 1994, section 297.32, 
  3.11  subdivision 2, is amended to read: 
  3.12     Subd. 2.  A tax is hereby imposed upon the use or storage 
  3.13  by consumers of tobacco products in this state, and upon such 
  3.14  consumers, at the rate of 35 65 percent of the cost of such 
  3.15  tobacco products.  
  3.16     The tax imposed by this subdivision shall not apply if the 
  3.17  tax imposed by subdivision 1 on such tobacco products has been 
  3.18  paid.  
  3.19     This tax shall not apply to the use or storage of tobacco 
  3.20  products in quantities of: 
  3.21     1.  not more than 50 cigars; 
  3.22     2.  not more than ten oz. snuff or snuff powder; 
  3.23     3.  not more than one lb. smoking or chewing tobacco or 
  3.24  other tobacco products not specifically mentioned herein, in the 
  3.25  possession of any one consumer.  
  3.26     Sec. 6.  Minnesota Statutes 1994, section 297.32, 
  3.27  subdivision 9, is amended to read: 
  3.28     Subd. 9.  (a) Revenue produced by taxes imposed under this 
  3.29  section at a rate of 30 percent must be credited to the health 
  3.30  care access fund in the state treasury. 
  3.31     (b) The remainder of the revenue derived from the taxes 
  3.32  imposed by this section must be deposited by the commissioner in 
  3.33  the state treasury and credited to the general fund. 
  3.34     Sec. 7.  [FLOOR STOCKS TAXES.] 
  3.35     Subdivision 1.  [IMPOSITION.] A floor stocks tax is imposed 
  3.36  on every person engaged in business in this state as a 
  4.1   distributor, retailer, subjobber, vendor, manufacturer, or 
  4.2   manufacturer's representative of cigarettes, on the stamped 
  4.3   cigarettes in the person's possession or under the person's 
  4.4   control at 12:01 a.m. on July 1, 1995.  The tax is imposed at 
  4.5   the following rates, subject to the discounts in Minnesota 
  4.6   Statutes, section 297.03: 
  4.7      (1) on cigarettes weighing not more than three pounds a 
  4.8   thousand, 20 mills on each cigarette; and 
  4.9      (2) on cigarettes weighing more than three pounds a 
  4.10  thousand, 40 mills on each cigarette. 
  4.11     Each distributor, by July 8, 1995, shall file a report with 
  4.12  the commissioner, in the form the commissioner prescribes, 
  4.13  showing the cigarettes on hand at 12:01 a.m. on July 1, 1995, 
  4.14  and the amount of tax due on the cigarettes.  The tax imposed by 
  4.15  this section is due and payable by August 1, 1995, and after 
  4.16  that date bears interest at the rate of one percent a month. 
  4.17     Each retailer, subjobber, vendor, manufacturer, or 
  4.18  manufacturer's representative shall file a return with the 
  4.19  commissioner, in the form the commissioner prescribes, showing 
  4.20  the cigarettes on hand at 12:01 a.m. on July 1, 1995, and pay 
  4.21  the tax due thereon by August 1, 1995.  Tax not paid by the due 
  4.22  date bears interest at the rate of one percent a month. 
  4.23     Subd. 2.  [TOBACCO PRODUCTS.] A floor stocks tax is imposed 
  4.24  upon every person engaged in business in this state as a 
  4.25  distributor of tobacco products, at the rate of ten percent of 
  4.26  the wholesale sales price of each tobacco product in the 
  4.27  person's possession or under the person's control at 12:01 a.m. 
  4.28  on July 1, 1995.  Each distributor, by July 8, 1995, shall file 
  4.29  a report with the commissioner, in the form the commissioner 
  4.30  prescribes, showing the tobacco products on hand at 12:01 a.m. 
  4.31  on July 1, 1995, and the amount of tax due on them.  The tax 
  4.32  imposed by this section less the discount provided in Minnesota 
  4.33  Statutes, section 297.35, subdivision 1, is due and payable by 
  4.34  August 1, 1995, and after that date bears interest at the rate 
  4.35  of one percent a month. 
  4.36     Subd. 3.  [AUDIT AND ENFORCEMENT.] The taxes imposed by 
  5.1   this section are subject to the audit, assessment, and 
  5.2   collection provisions applicable to the taxes imposed under 
  5.3   Minnesota Statutes, chapter 297C.  The commissioner may require 
  5.4   a distributor to receive and maintain copies of floor stock tax 
  5.5   returns filed by all persons requesting a credit for returned 
  5.6   cigarettes. 
  5.7      Subd. 4.  [DEPOSIT OF PROCEEDS.] The revenue from the taxes 
  5.8   imposed under this section shall be deposited by the 
  5.9   commissioner in the state treasury and credited to the health 
  5.10  care access fund. 
  5.11     Sec. 8.  [EFFECTIVE DATE.] 
  5.12     Sections 1 to 7 are effective July 1, 1995.