Minnesota Legislature
SF 2529
as introduced - 92nd Legislature (2021 - 2022) Posted on 08/12/2021 04:31pm
Current Version - as introduced
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A bill for an act
relating to taxation; tobacco products; clarifying obligations for certain out-of-state
tobacco products retailers; amending Minnesota Statutes 2020, sections 297F.01,
by adding a subdivision; 297F.031; 297F.05, by adding a subdivision; 297F.09,
subdivisions 3, 4a, 7, 10; 325F.781, subdivisions 1, 5, 6.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2020, section 297F.01, is amended by adding a subdivision
to read:
new text begin Subd. 7a. new text end
new text begin Delivery sale. new text end
new text begin
"Delivery sale" has the meaning given in section 325F.781,
subdivision 1.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2022.
new text end
Sec. 2.
Minnesota Statutes 2020, section 297F.031, is amended to read:
297F.031 REGISTRATION REQUIREMENT.
Prior to making delivery sales deleted text begin or shipping cigarettes or tobacco products in connection
with any salesdeleted text end , an out-of-state retailer deleted text begin shalldeleted text end new text begin mustnew text end file with the Department of Revenue a
statement setting forth the out-of-state retailer's name, trade name, deleted text begin and thedeleted text end address deleted text begin of the
out-of-state retailer'sdeleted text end new text begin ,new text end principal place of businessnew text begin ,new text end and any other place of business.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for all delivery sales occurring after
December 31, 2021.
new text end
Sec. 3.
Minnesota Statutes 2020, section 297F.05, is amended by adding a subdivision to
read:
new text begin Subd. 4b. new text end
new text begin Retailer collection and remittance of use tax. new text end
new text begin
A retailer or out-of-state
retailer must, for any delivery sale, collect and pay to the state any use tax imposed by this
section. The retailer or out-of-state retailer must give the purchaser a receipt for the tax paid.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for all delivery sales occurring after
December 31, 2021.
new text end
Sec. 4.
Minnesota Statutes 2020, section 297F.09, subdivision 3, is amended to read:
Subd. 3.
Use tax return; cigarette or tobacco products consumernew text begin and retailers
making delivery salesnew text end .
new text begin (a) new text end On or before the 18th day of each calendar month, a consumer
who, during the preceding calendar month, has acquired title to or possession of cigarettes
or tobacco products for use or storage in this state, upon which cigarettes or tobacco products
the tax imposed by this chapter has not been paid, shall file a return with the commissioner
showing the quantity of cigarettes or tobacco products so acquired. The return must be made
in the form and manner prescribed by the commissioner, and must contain any other
information required by the commissioner. The return must be accompanied by a remittance
for the full unpaid tax liability shown by it.
new text begin
(b) On or before the 18th day of each calendar month, a retailer or out-of-state retailer
who, during the preceding calendar month, made delivery sales must file a return with the
commissioner showing the quantity of cigarettes or tobacco products so delivered. The
commissioner shall prescribe the content, format, and manner of returns pursuant to section
270C.30. The return must be accompanied by a remittance for the full unpaid tax liability.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for all delivery sales occurring after
December 31, 2021.
new text end
Sec. 5.
Minnesota Statutes 2020, section 297F.09, subdivision 4a, is amended to read:
Subd. 4a.
Reporting requirements.
No later than the 18th day of each calendar month,
deleted text begin andeleted text end new text begin a retailer ornew text end out-of-state retailer that has made deleted text begin a delivery of cigarettes or tobacco products
or shipped or delivered cigarettes or tobacco products into the state indeleted text end a delivery sale in the
previous calendar month shall file with the Department of Revenue deleted text begin reportsdeleted text end new text begin a reportnew text end in the
form and in the manner prescribed by the commissioner of revenue that provides for each
delivery sale, the name and address of the purchaser and the brand or brands and quantity
of cigarettes or tobacco products sold. A deleted text begin tobaccodeleted text end retailer new text begin or out-of-state retailer new text end that meets
the requirements of United States Code, title 15, section 375 et seq. satisfies the requirements
of this subdivision.new text begin The filing of a return under subdivision 3, paragraph (b), satisfies the
requirements of this subdivision for the applicable month.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for all delivery sales occurring after
December 31, 2021.
new text end
Sec. 6.
Minnesota Statutes 2020, section 297F.09, subdivision 7, is amended to read:
Subd. 7.
Electronic payment.
A cigarette deleted text begin ordeleted text end new text begin distributor,new text end tobacco products distributornew text begin ,
retailer, or out-of-state retailernew text end having a liability of $10,000 or more during a fiscal year
ending June 30 must remit all liabilities in all subsequent calendar years by electronic means.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for all delivery sales occurring after
December 31, 2021.
new text end
Sec. 7.
Minnesota Statutes 2020, section 297F.09, subdivision 10, is amended to read:
Subd. 10.
Accelerated tax paymentdeleted text begin ; cigarette or tobacco products distributordeleted text end .
A
cigarette deleted text begin ordeleted text end new text begin distributor,new text end tobacco products distributornew text begin , retailer, or out-of-state retailernew text end having
a liability of $250,000 or more during a fiscal year ending June 30, shall remit the June
liability for the next year in the following manner:
(a) Two business days before June 30 of calendar years 2020 and 2021, the distributor
shall remit the actual May liability and 87.5 percent of the estimated June liability to the
commissioner and file the return in the form and manner prescribed by the commissioner.
(b) On or before August 18 of the year, the distributornew text begin , retailer, or out-of-state retailernew text end
shall submit a return showing the actual June liability and pay any additional amount of tax
not remitted in June. A penalty is imposed equal to ten percent of the amount of June liability
required to be paid in June, less the amount remitted in June. However, the penalty is not
imposed if the amount remitted in June equals the lesser of:
(1) 87.5 percent of the actual June liability for the calendar year 2020 and 2021 June
liabilities and 84.5 of the actual June liability for June 2022 and thereafter; or
(2) 87.5 percent of the preceding May liability for the calendar year 2020 and 2021 June
liabilities and 84.5 percent of the preceding May liability for June 2022 and thereafter.
(c) For calendar year 2022 and thereafter, the percent of the estimated June liability the
vendor must remit by two business days before June 30 is 84.5 percent.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for all delivery sales occurring after
December 31, 2021.
new text end
Sec. 8.
Minnesota Statutes 2020, section 325F.781, subdivision 1, is amended to read:
Subdivision 1.
Definitions.
(a) For purposes of this section, the following terms have
the meanings given, unless the language or context clearly provides otherwise.
(b) "Consumer" means an individual who purchases, receives, or possesses tobacco
products for personal consumption and not for resale.
(c) "Delivery sale" means:
(1) a sale of tobacco products to a consumer in this state when:
(i) the purchaser submits the order for the sale by means of a telephonic or other method
of voice transmission, the mail or any other delivery service, or the Internet or other online
service; or
(ii) the tobacco products are delivered by use of the mail or other delivery service; or
(2) a sale of tobacco products that satisfies the criteria in clause (1), item (i), regardless
of whether the seller is located inside or outside of the state.
A sale of tobacco products to an individual in this state must be treated as a sale to a
consumer, unless the individual is licensed as a distributor or retailer of tobacco products.
(d) "Delivery service" means a person, including the United States Postal Service, that
is engaged in the commercial delivery of letters, packages, or other containers.
(e) "Distributor" means a person, whether located inside or outside of this state, other
than a retailer, who sells or distributes tobacco products in the state. Distributor does not
include a tobacco products manufacturer, export warehouse proprietor, or importer with a
valid permit under United States Code, title 26, section 5712 (1997), if the person sells or
distributes tobacco products in this state only to distributors who hold valid and current
licenses under the laws of a state, or to an export warehouse proprietor or another
manufacturer. Distributor does not include a common or contract carrier that is transporting
tobacco products under a proper bill of lading or freight bill that states the quantity, source,
and destination of tobacco products, or a person who ships tobacco products through this
state by common or contract carrier under a bill of lading or freight bill.
(f) "Retailer" means a person, whether located inside or outside this state, who sells or
distributes tobacco products to a consumer in this state.
(g) "Tobacco products" meansdeleted text begin :deleted text end new text begin cigarettes and tobacco products as defined in section
297F.01.
new text end
deleted text begin
(1) cigarettes, as defined in section 297F.01, subdivision 3;
deleted text end
deleted text begin
(2) smokeless tobacco as defined in section 325F.76; and
deleted text end
deleted text begin
(3) premium cigars as defined in section 297F.01, subdivision 13a.
deleted text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2022.
new text end
Sec. 9.
Minnesota Statutes 2020, section 325F.781, subdivision 5, is amended to read:
Subd. 5.
Registration requirement.
Prior to making delivery sales deleted text begin or shipping tobacco
products in connection with any salesdeleted text end , an out-of-state retailer must deleted text begin meet the requirements
ofdeleted text end new text begin register with the commissioner of revenue as required undernew text end section 297F.031.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for all delivery sales occurring after
December 31, 2021.
new text end
Sec. 10.
Minnesota Statutes 2020, section 325F.781, subdivision 6, is amended to read:
Subd. 6.
Collection of taxes.
(a) deleted text begin Prior to shipping any tobacco products to a purchaser
in this state, the out-of-statedeleted text end new text begin Anew text end retailer deleted text begin shall comply with all requirements ofdeleted text end new text begin making delivery
sales must file all returns and reports, collect and pay all taxes, and maintain all records
required undernew text end chapter 297F deleted text begin and shall ensure that all state excise taxes and fees that apply
to such tobacco products have been collected and paid to the state and that all related state
excise tax stamps or other indicators of state excise tax payment have been properly affixed
to those tobacco productsdeleted text end .
(b) In addition to any penalties under chapter 297F, deleted text begin a distributordeleted text end new text begin a retailer making delivery
salesnew text end who fails to pay any tax due deleted text begin according to paragraph (a)deleted text end new text begin under chapter 297F,new text end shall pay,
in addition to any other penalty, a penalty of 50 percent of the tax due but unpaid.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective for all delivery sales occurring after
December 31, 2021.
new text end