1-1 By: Ritter (Senate Sponsor - Zaffirini) H.B. No. 2413
1-2 (In the Senate - Received from the House May 7, 2001;
1-3 May 7, 2001, read first time and referred to Committee on Business
1-4 and Commerce; May 10, 2001, reported favorably by the following
1-5 vote: Yeas 6, Nays 0; May 10, 2001, sent to printer.)
1-6 A BILL TO BE ENTITLED
1-7 AN ACT
1-8 relating to the tax on cigarettes, cigars, and other tobacco
1-9 products.
1-10 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11 SECTION 1. Section 154.001, Tax Code, is amended to read as
1-12 follows:
1-13 Sec. 154.001. DEFINITIONS. In this chapter:
1-14 (1) "Bonded agent" means a person in this state who is
1-15 an agent of a person outside this state and receives cigarettes in
1-16 interstate commerce and stores the cigarettes for distribution or
1-17 delivery to distributors under orders from the person outside this
1-18 state.
1-19 (2) "Cigarette" means a roll for smoking:
1-20 (A) that is made of tobacco or tobacco mixed
1-21 with another ingredient and wrapped or covered with a material
1-22 other than tobacco; and
1-23 (B) that is not a cigar.
1-24 (3) "Commercial business location" means the entire
1-25 premises occupied by a permit applicant or a person required to
1-26 hold a permit under this chapter.
1-27 (4) "Common carrier" means a motor carrier registered
1-28 under Chapter 643, Transportation Code, or a motor carrier
1-29 operating under a certificate issued by the Interstate Commerce
1-30 Commission or a successor agency to the Interstate Commerce
1-31 Commission.
1-32 (5) [(4)] "Consumer" means a person who possesses
1-33 cigarettes for personal consumption.
1-34 (6) [(5)] "Counterfeit stamp" means a sticker, label,
1-35 print, tag, or token that is used or is intended to be used to
1-36 simulate a stamp and that is not authorized or issued by the
1-37 comptroller.
1-38 (7) [(6)] "Distributor" means a person who:
1-39 (A) is authorized to purchase for the purpose of
1-40 making a first sale in this state cigarettes in unstamped packages
1-41 from manufacturers who distribute cigarettes in this state and to
1-42 stamp cigarette packages;
1-43 (B) ships, transports, imports into this state,
1-44 acquires, or possesses cigarettes and makes a first sale of the
1-45 cigarettes in this state;
1-46 (C) manufactures or produces cigarettes; or
1-47 (D) is an importer or import broker.
1-48 (8) [(7)] "Export warehouse" means a person in this
1-49 state who receives cigarettes in unstamped packages from
1-50 manufacturers and stores the cigarettes for the purpose of making
1-51 sales to authorized persons for resale, use, or consumption outside
1-52 the United States.
1-53 (9) [(8)] "First sale" means, except as otherwise
1-54 provided by this chapter:
1-55 (A) the first transfer of possession in
1-56 connection with a purchase, sale, or any exchange for value of
1-57 cigarettes in intrastate commerce;
1-58 (B) the first use or consumption of cigarettes
1-59 in this state; or
1-60 (C) the loss of cigarettes in this state whether
1-61 through negligence, theft, or other unaccountable loss.
1-62 (10) [(9)] "Importer" or "import broker" means a
1-63 person who ships, transports, or imports into this state cigarettes
1-64 manufactured or produced outside the United States for the purpose
2-1 of making a first sale in this state.
2-2 (11) [(10)] "Individual package of cigarettes" means a
2-3 package that contains not fewer than 10 cigarettes.
2-4 (12) [(11)] "Manufacturer" means a person who
2-5 manufactures and sells cigarettes to a distributor.
2-6 (13) [(12)] "Manufacturer's representative" means a
2-7 person employed by a manufacturer to sell or distribute the
2-8 manufacturer's stamped cigarette packages.
2-9 (14) [(13)] "Permit holder" means a bonded agent,
2-10 distributor, wholesaler, or retailer required to obtain a permit
2-11 under Section 154.101.
2-12 (15) [(14)] "Place of business" means:
2-13 (A) a commercial business location where
2-14 cigarettes are sold;
2-15 (B) a commercial business location where
2-16 cigarettes are kept for sale or consumption or otherwise stored; or
2-17 (C) a vehicle from which cigarettes are sold.
2-18 (16) [(15)] "Previously used stamp" means a stamp that
2-19 has been used to show payment of a tax imposed by this chapter and
2-20 is again used, sold, or possessed for sale or use to show payment
2-21 of a tax imposed by this chapter.
2-22 (17) [(16)] "Retailer" means a person who engages in
2-23 the practice of selling cigarettes to consumers and includes the
2-24 owner of a coin-operated cigarette vending machine.
2-25 (18) [(17)] "Stamp" includes only a stamp that:
2-26 (A) is printed, manufactured, or made by
2-27 authority of the comptroller;
2-28 (B) shows payment of the tax imposed by this
2-29 chapter; and
2-30 (C) is consecutively numbered and uniquely
2-31 identifiable as a Texas tax stamp.
2-32 (19) [(18)] "Wholesaler" means a person, including a
2-33 manufacturer's representative, who sells or distributes cigarettes
2-34 in this state for resale but who is not a distributor.
2-35 SECTION 2. Subchapter A, Chapter 154, Tax Code, is amended by
2-36 adding Section 154.002 to read as follows:
2-37 Sec. 154.002. STORAGE. The commercial business location
2-38 where cigarettes are stored or kept cannot be a residence or a unit
2-39 in a public storage facility.
2-40 SECTION 3. Section 154.209(b), Tax Code, is amended to read
2-41 as follows:
2-42 (b) If a permit holder's place of business is a vehicle or
2-43 vending machine, the permit holder shall designate in the
2-44 application for a permit a permanent place of business to keep the
2-45 records. The permit holder shall keep the records in the
2-46 designated place.
2-47 SECTION 4. Section 155.001, Tax Code, is amended to read as
2-48 follows:
2-49 Sec. 155.001. DEFINITIONS. In this chapter:
2-50 (1) "Bonded agent" means a person in this state who is
2-51 an agent of a person outside this state and receives cigars and
2-52 tobacco products in interstate commerce and stores the cigars and
2-53 tobacco products for distribution or delivery to distributors under
2-54 orders from the person outside this state.
2-55 (2) "Cigar" means a roll of fermented tobacco that is
2-56 wrapped in tobacco and the main stream of smoke from which produces
2-57 an alkaline reaction to litmus paper.
2-58 (3) "Commercial business location" means the entire
2-59 premises occupied by a permit applicant or a person required to
2-60 hold a permit under this chapter.
2-61 (4) "Common carrier" means a motor carrier registered
2-62 under Chapter 643, Transportation Code, or a motor carrier
2-63 operating under a certificate issued by the Interstate Commerce
2-64 Commission or a successor agency to the Interstate Commerce
2-65 Commission.
2-66 (5) [(4)] "Consumer" means a person who possesses
2-67 tobacco products for personal consumption.
2-68 (6) [(5)] "Distributor" means a person who:
2-69 (A) receives tobacco products for the purpose of
3-1 making a first sale in this state from a manufacturer outside the
3-2 state or within the state or otherwise brings or causes to be
3-3 brought into this state tobacco products for sale, use, or
3-4 consumption;
3-5 (B) manufactures or produces tobacco products;
3-6 or
3-7 (C) is an importer or import broker.
3-8 (7) [(6)] "Export warehouse" means a person in this
3-9 state who receives tobacco products from manufacturers and stores
3-10 the tobacco products for the purpose of making sales to authorized
3-11 persons for resale, use, or consumption outside the United States.
3-12 (8) [(7)] "First sale" means, except as otherwise
3-13 provided by this chapter:
3-14 (A) the first transfer of possession in
3-15 connection with a purchase, sale, or any exchange for value of
3-16 tobacco products in intrastate commerce;
3-17 (B) the first use or consumption of tobacco
3-18 products in this state; or
3-19 (C) the loss of tobacco products in this state
3-20 whether through negligence, theft, or other unaccountable loss.
3-21 (9) [(8)] "Importer" or "import broker" means a person
3-22 who ships, transports, or imports into this state tobacco products
3-23 manufactured or produced outside the United States for the purpose
3-24 of making a first sale in this state.
3-25 (10) [(9)] "Manufacturer" means a person who
3-26 manufactures or produces tobacco products and sells tobacco
3-27 products to a distributor.
3-28 (11) [(10)] "Manufacturer's representative" means a
3-29 person employed by a manufacturer to sell or distribute the
3-30 manufacturer's tobacco products.
3-31 (12) [(11)] "Permit holder" means a bonded agent,
3-32 distributor, wholesaler, or retailer required to obtain a permit
3-33 under Section 155.041.
3-34 (13) [(12)] "Place of business" means:
3-35 (A) a commercial business location where tobacco
3-36 products are sold;
3-37 (B) a commercial business location where tobacco
3-38 products are kept for sale or consumption or otherwise stored; or
3-39 (C) a vehicle from which tobacco products are
3-40 sold.
3-41 (14) [(13)] "Retailer" means a person who engages in
3-42 the practice of selling tobacco products to consumers and includes
3-43 the owner of a coin-operated vending machine.
3-44 (15) [(14)] "Tobacco product" means:
3-45 (A) a cigar;
3-46 (B) smoking tobacco, including granulated,
3-47 plug-cut, crimp-cut, ready-rubbed, and any form of tobacco suitable
3-48 for smoking in a pipe or as a cigarette;
3-49 (C) chewing tobacco, including Cavendish, Twist,
3-50 plug, scrap, and any kind of tobacco suitable for chewing;
3-51 (D) snuff or other preparations of pulverized
3-52 tobacco; or
3-53 (E) an article or product that is made of
3-54 tobacco or a tobacco substitute and that is not a cigarette.
3-55 (16) [(15)] "Wholesaler" means a person, including a
3-56 manufacturer's representative, who sells or distributes tobacco
3-57 products in this state for resale but who is not a distributor.
3-58 SECTION 5. Subchapter A, Chapter 155, Tax Code, is amended by
3-59 adding Section 155.002 to read as follows:
3-60 Sec. 155.002. STORAGE. The commercial business location
3-61 where tobacco products are stored or kept cannot be a residence or
3-62 a unit in a public storage facility.
3-63 SECTION 6. Section 155.110(b), Tax Code, is amended to read
3-64 as follows:
3-65 (b) If a permit holder's place of business is a vehicle or
3-66 vending machine, the permit holder shall designate in the
3-67 application for a permit a permanent place of business to keep the
3-68 records. The permit holder shall keep the records in the
3-69 designated place.
4-1 SECTION 7. This Act takes effect September 1, 2001.
4-2 * * * * *