1-1 AN ACT
1-2 relating to the tax on cigarettes, cigars, and other tobacco
1-3 products.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 154.001, Tax Code, is amended to read as
1-6 follows:
1-7 Sec. 154.001. DEFINITIONS. In this chapter:
1-8 (1) "Bonded agent" means a person in this state who is
1-9 an agent of a person outside this state and receives cigarettes in
1-10 interstate commerce and stores the cigarettes for distribution or
1-11 delivery to distributors under orders from the person outside this
1-12 state.
1-13 (2) "Cigarette" means a roll for smoking:
1-14 (A) that is made of tobacco or tobacco mixed
1-15 with another ingredient and wrapped or covered with a material
1-16 other than tobacco; and
1-17 (B) that is not a cigar.
1-18 (3) "Commercial business location" means the entire
1-19 premises occupied by a permit applicant or a person required to
1-20 hold a permit under this chapter.
1-21 (4) "Common carrier" means a motor carrier registered
1-22 under Chapter 643, Transportation Code, or a motor carrier
1-23 operating under a certificate issued by the Interstate Commerce
1-24 Commission or a successor agency to the Interstate Commerce
2-1 Commission.
2-2 (5) [(4)] "Consumer" means a person who possesses
2-3 cigarettes for personal consumption.
2-4 (6) [(5)] "Counterfeit stamp" means a sticker, label,
2-5 print, tag, or token that is used or is intended to be used to
2-6 simulate a stamp and that is not authorized or issued by the
2-7 comptroller.
2-8 (7) [(6)] "Distributor" means a person who:
2-9 (A) is authorized to purchase for the purpose of
2-10 making a first sale in this state cigarettes in unstamped packages
2-11 from manufacturers who distribute cigarettes in this state and to
2-12 stamp cigarette packages;
2-13 (B) ships, transports, imports into this state,
2-14 acquires, or possesses cigarettes and makes a first sale of the
2-15 cigarettes in this state;
2-16 (C) manufactures or produces cigarettes; or
2-17 (D) is an importer or import broker.
2-18 (8) [(7)] "Export warehouse" means a person in this
2-19 state who receives cigarettes in unstamped packages from
2-20 manufacturers and stores the cigarettes for the purpose of making
2-21 sales to authorized persons for resale, use, or consumption outside
2-22 the United States.
2-23 (9) [(8)] "First sale" means, except as otherwise
2-24 provided by this chapter:
2-25 (A) the first transfer of possession in
2-26 connection with a purchase, sale, or any exchange for value of
2-27 cigarettes in intrastate commerce;
3-1 (B) the first use or consumption of cigarettes
3-2 in this state; or
3-3 (C) the loss of cigarettes in this state whether
3-4 through negligence, theft, or other unaccountable loss.
3-5 (10) [(9)] "Importer" or "import broker" means a
3-6 person who ships, transports, or imports into this state cigarettes
3-7 manufactured or produced outside the United States for the purpose
3-8 of making a first sale in this state.
3-9 (11) [(10)] "Individual package of cigarettes" means a
3-10 package that contains not fewer than 10 cigarettes.
3-11 (12) [(11)] "Manufacturer" means a person who
3-12 manufactures and sells cigarettes to a distributor.
3-13 (13) [(12)] "Manufacturer's representative" means a
3-14 person employed by a manufacturer to sell or distribute the
3-15 manufacturer's stamped cigarette packages.
3-16 (14) [(13)] "Permit holder" means a bonded agent,
3-17 distributor, wholesaler, or retailer required to obtain a permit
3-18 under Section 154.101.
3-19 (15) [(14)] "Place of business" means:
3-20 (A) a commercial business location where
3-21 cigarettes are sold;
3-22 (B) a commercial business location where
3-23 cigarettes are kept for sale or consumption or otherwise stored; or
3-24 (C) a vehicle from which cigarettes are sold.
3-25 (16) [(15)] "Previously used stamp" means a stamp that
3-26 has been used to show payment of a tax imposed by this chapter and
3-27 is again used, sold, or possessed for sale or use to show payment
4-1 of a tax imposed by this chapter.
4-2 (17) [(16)] "Retailer" means a person who engages in
4-3 the practice of selling cigarettes to consumers and includes the
4-4 owner of a coin-operated cigarette vending machine.
4-5 (18) [(17)] "Stamp" includes only a stamp that:
4-6 (A) is printed, manufactured, or made by
4-7 authority of the comptroller;
4-8 (B) shows payment of the tax imposed by this
4-9 chapter; and
4-10 (C) is consecutively numbered and uniquely
4-11 identifiable as a Texas tax stamp.
4-12 (19) [(18)] "Wholesaler" means a person, including a
4-13 manufacturer's representative, who sells or distributes cigarettes
4-14 in this state for resale but who is not a distributor.
4-15 SECTION 2. Subchapter A, Chapter 154, Tax Code, is amended by
4-16 adding Section 154.002 to read as follows:
4-17 Sec. 154.002. STORAGE. The commercial business location
4-18 where cigarettes are stored or kept cannot be a residence or a unit
4-19 in a public storage facility.
4-20 SECTION 3. Section 154.209(b), Tax Code, is amended to read
4-21 as follows:
4-22 (b) If a permit holder's place of business is a vehicle or
4-23 vending machine, the permit holder shall designate in the
4-24 application for a permit a permanent place of business to keep the
4-25 records. The permit holder shall keep the records in the
4-26 designated place.
4-27 SECTION 4. Section 155.001, Tax Code, is amended to read as
5-1 follows:
5-2 Sec. 155.001. DEFINITIONS. In this chapter:
5-3 (1) "Bonded agent" means a person in this state who is
5-4 an agent of a person outside this state and receives cigars and
5-5 tobacco products in interstate commerce and stores the cigars and
5-6 tobacco products for distribution or delivery to distributors under
5-7 orders from the person outside this state.
5-8 (2) "Cigar" means a roll of fermented tobacco that is
5-9 wrapped in tobacco and the main stream of smoke from which produces
5-10 an alkaline reaction to litmus paper.
5-11 (3) "Commercial business location" means the entire
5-12 premises occupied by a permit applicant or a person required to
5-13 hold a permit under this chapter.
5-14 (4) "Common carrier" means a motor carrier registered
5-15 under Chapter 643, Transportation Code, or a motor carrier
5-16 operating under a certificate issued by the Interstate Commerce
5-17 Commission or a successor agency to the Interstate Commerce
5-18 Commission.
5-19 (5) [(4)] "Consumer" means a person who possesses
5-20 tobacco products for personal consumption.
5-21 (6) [(5)] "Distributor" means a person who:
5-22 (A) receives tobacco products for the purpose of
5-23 making a first sale in this state from a manufacturer outside the
5-24 state or within the state or otherwise brings or causes to be
5-25 brought into this state tobacco products for sale, use, or
5-26 consumption;
5-27 (B) manufactures or produces tobacco products;
6-1 or
6-2 (C) is an importer or import broker.
6-3 (7) [(6)] "Export warehouse" means a person in this
6-4 state who receives tobacco products from manufacturers and stores
6-5 the tobacco products for the purpose of making sales to authorized
6-6 persons for resale, use, or consumption outside the United States.
6-7 (8) [(7)] "First sale" means, except as otherwise
6-8 provided by this chapter:
6-9 (A) the first transfer of possession in
6-10 connection with a purchase, sale, or any exchange for value of
6-11 tobacco products in intrastate commerce;
6-12 (B) the first use or consumption of tobacco
6-13 products in this state; or
6-14 (C) the loss of tobacco products in this state
6-15 whether through negligence, theft, or other unaccountable loss.
6-16 (9) [(8)] "Importer" or "import broker" means a person
6-17 who ships, transports, or imports into this state tobacco products
6-18 manufactured or produced outside the United States for the purpose
6-19 of making a first sale in this state.
6-20 (10) [(9)] "Manufacturer" means a person who
6-21 manufactures or produces tobacco products and sells tobacco
6-22 products to a distributor.
6-23 (11) [(10)] "Manufacturer's representative" means a
6-24 person employed by a manufacturer to sell or distribute the
6-25 manufacturer's tobacco products.
6-26 (12) [(11)] "Permit holder" means a bonded agent,
6-27 distributor, wholesaler, or retailer required to obtain a permit
7-1 under Section 155.041.
7-2 (13) [(12)] "Place of business" means:
7-3 (A) a commercial business location where tobacco
7-4 products are sold;
7-5 (B) a commercial business location where tobacco
7-6 products are kept for sale or consumption or otherwise stored; or
7-7 (C) a vehicle from which tobacco products are
7-8 sold.
7-9 (14) [(13)] "Retailer" means a person who engages in
7-10 the practice of selling tobacco products to consumers and includes
7-11 the owner of a coin-operated vending machine.
7-12 (15) [(14)] "Tobacco product" means:
7-13 (A) a cigar;
7-14 (B) smoking tobacco, including granulated,
7-15 plug-cut, crimp-cut, ready-rubbed, and any form of tobacco suitable
7-16 for smoking in a pipe or as a cigarette;
7-17 (C) chewing tobacco, including Cavendish, Twist,
7-18 plug, scrap, and any kind of tobacco suitable for chewing;
7-19 (D) snuff or other preparations of pulverized
7-20 tobacco; or
7-21 (E) an article or product that is made of
7-22 tobacco or a tobacco substitute and that is not a cigarette.
7-23 (16) [(15)] "Wholesaler" means a person, including a
7-24 manufacturer's representative, who sells or distributes tobacco
7-25 products in this state for resale but who is not a distributor.
7-26 SECTION 5. Subchapter A, Chapter 155, Tax Code, is amended by
7-27 adding Section 155.002 to read as follows:
8-1 Sec. 155.002. STORAGE. The commercial business location
8-2 where tobacco products are stored or kept cannot be a residence or
8-3 a unit in a public storage facility.
8-4 SECTION 6. Section 155.110(b), Tax Code, is amended to read
8-5 as follows:
8-6 (b) If a permit holder's place of business is a vehicle or
8-7 vending machine, the permit holder shall designate in the
8-8 application for a permit a permanent place of business to keep the
8-9 records. The permit holder shall keep the records in the
8-10 designated place.
8-11 SECTION 7. This Act takes effect September 1, 2001.
_______________________________ _______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 2413 was passed by the House on May
5, 2001, by a non-record vote.
_______________________________
Chief Clerk of the House
I certify that H.B. No. 2413 was passed by the Senate on May
22, 2001, by the following vote: Yeas 30, Nays 0, 1 present, not
voting.
_______________________________
Secretary of the Senate
APPROVED: __________________________
Date
__________________________
Governor