Minnesota Legislature
SF 2025
as introduced - 89th Legislature (2015 - 2016) Posted on 04/08/2015 09:17am
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A bill for an act
relating to taxation; tobacco; changing the tax rate for nicotine solution used
in electronic cigarettes; amending Minnesota Statutes 2014, sections 297F.01,
subdivision 19, by adding subdivisions; 297F.05, subdivision 3, by adding
subdivisions; 297F.06, subdivisions 1, 4; 325F.77, subdivision 4.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2014, section 297F.01, is amended by adding a
subdivision to read:
new text begin Subd. 6a. new text end
new text begin Consumable material. new text end
new text begin
"Consumable material" means any liquid nicotine
solution or other material containing nicotine that is depleted as a vapor product is used.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2015.
new text end
Sec. 2.
Minnesota Statutes 2014, section 297F.01, subdivision 19, is amended to read:
Subd. 19.
Tobacco products.
(a) "Tobacco products" means any product
containing, made, or derived from tobacco that is intended for human consumption,
whether chewed, smoked, absorbed, dissolved, inhaled, snorted, sniffed, or ingested by
any other means, or any component, part, or accessory of a tobacco product, including,
but not limited to, cigars; cheroots; stogies; periques; granulated, plug cut, crimp cut,
ready rubbed, and other smoking tobacco; snuff; snuff flour; cavendish; plug and twist
tobacco; fine-cut and other chewing tobacco; shorts; refuse scraps, clippings, cuttings and
sweepings of tobacco,new text begin vapor products,new text end and other kinds and forms of tobacco; but does
not include cigarettes as defined in this section. Tobacco products excludes any tobacco
product that has been approved by the United States Food and Drug Administration for
sale as a tobacco cessation product, as a tobacco dependence product, or for other medical
purposes, and is being marketed and sold solely for such an approved purpose.
(b) Except for the imposition of tax under section 297F.05, subdivisions 3 and 4,
tobacco products includes a premium cigar, as defined in subdivision 13a.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2015.
new text end
Sec. 3.
Minnesota Statutes 2014, section 297F.01, is amended by adding a subdivision
to read:
new text begin Subd. 24. new text end
new text begin Vapor products. new text end
new text begin
"Vapor products" means any noncombustible product
that employs a heating element, power source, electronic circuit, or other electronic,
chemical, or mechanical means, regardless of shape or size, that can be used to produce
vapor from nicotine in a solution or other form. Vapor products includes any electronic
cigarette, electronic cigar, electronic cigarillo, electronic pipe, or similar product or device
and any vapor cartridge or other container of nicotine in a solution or other form that is
intended to be used with or in an electronic cigarette, electronic cigar, electronic cigarillo,
electronic pipe, or similar product or device. Vapor products does not include any product
regulated as a drug or device by the United States Food and Drug Administration.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2015.
new text end
Sec. 4.
Minnesota Statutes 2014, section 297F.05, subdivision 3, is amended to read:
Subd. 3.
Rates; tobacco products.
(a) Except as provided in deleted text begin subdivisiondeleted text end new text begin
subdivisionsnew text end 3anew text begin and 3bnew text end , a tax is imposed upon all tobacco products in this state and upon
any person engaged in business as a distributor, at the rate of 95 percent of the wholesale
sales price of the tobacco products. The tax is imposed at the time the distributor:
(1) brings, or causes to be brought, into this state from outside the state tobacco
products for sale;
(2) makes, manufactures, or fabricates tobacco products in this state for sale in
this state; or
(3) ships or transports tobacco products to retailers in this state, to be sold by those
retailers.
(b) Notwithstanding paragraph (a), a minimum tax equal to the rate imposed on a
pack of 20 cigarettes weighing not more than three pounds per thousand, as established
under subdivision 1, is imposed on each container of moist snuff.
For purposes of this subdivision, a "container" means the smallest consumer-size can,
package, or other container that is marketed or packaged by the manufacturer, distributor,
or retailer for separate sale to a retail purchaser. When more than one container is
packaged together, each container is subject to tax.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales made on or after July 1, 2015.
new text end
Sec. 5.
Minnesota Statutes 2014, section 297F.05, is amended by adding a subdivision
to read:
new text begin Subd. 3b. new text end
new text begin Rates; vapor products. new text end
new text begin
A tax is imposed upon all vapor products in this
state and upon any person engaged in business as a tobacco product distributor, at the rate
of 30 cents per milliliter of consumable material. The tax imposed under this subdivision
is imposed at the time the tobacco products distributor:
new text end
new text begin
(1) brings, or causes to be brought into this state, vapor products for sale;
new text end
new text begin
(2) makes, manufactures, or fabricates vapor products in this state for sale in this
state; or
new text end
new text begin
(3) ships or transports vapor products to retailers in this state to be sold by those
retailers.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales made on or after July 1, 2015.
new text end
Sec. 6.
Minnesota Statutes 2014, section 297F.05, is amended by adding a subdivision
to read:
new text begin Subd. 4b. new text end
new text begin Use tax; vapor products. new text end
new text begin
A tax is imposed upon the use or storage by
consumers of all vapor products in this state, and upon such consumers, at the rate of 30
cents per milliliter of consumable material.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for use and storage of vapor products
on or after July 1, 2015.
new text end
Sec. 7.
Minnesota Statutes 2014, section 297F.06, subdivision 1, is amended to read:
Subdivision 1.
Federal laws.
The tax imposed by this section does not apply with
respect to any sale of cigarettesnew text begin , vapor products,new text end or tobacco products which under the
Constitution and laws of the United States may not be subject to taxation by the state.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for sales made on or after July 1, 2015.
new text end
Sec. 8.
Minnesota Statutes 2014, section 297F.06, subdivision 4, is amended to read:
Subd. 4.
Tobacco products use tax.
The tobacco products use tax does not apply
to the possession, use, or storage of tobacco products if (1) the tobacco products have
an aggregate cost in any calendar month to the consumer of $50 or less, deleted text begin anddeleted text end (2)new text begin the
consumable material subject to the tax does not exceed in the aggregate 50 milliliters in any
calendar month, and (3)new text end the tobacco products were carried into this state by that consumer.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for possession, use, or storage of
tobacco products on or after July 1, 2015.
new text end
Sec. 9.
Minnesota Statutes 2014, section 325F.77, subdivision 4, is amended to read:
Subd. 4.
Prohibition.
new text begin (a) new text end new text begin Subject to the exceptions in paragraph (b), new text end no person shall
distribute smokeless tobacco products or cigarettes, cigars, pipe tobacco, or other tobacco
products as defined in section 297F.01, subdivision 19deleted text begin , except that single serving samples
of tobacco may be distributed in tobacco storesdeleted text end .
new text begin
(b) The following tobacco products are not subject to the prohibition in paragraph (a):
new text end
new text begin
(1) single serving samples of tobacco, if distributed in tobacco stores; and
new text end
new text begin
(2) vapor products as defined in section 297F.01, subdivision 24.
new text end