HB 1459

1
A bill to be entitled
2An act relating to transportation and sale of cigarettes;
3amending s. 210.01, F.S.; revising and providing
4definitions; amending s. 210.05, F.S.; providing stamp
5requirements for cigarettes in transport; providing stamp
6exceptions for certain cigarettes; requiring transporters
7of certain cigarettes to submit certain reports; amending
8s. 210.06, F.S.; revising requirements for and limitations
9on the affixation of stamps; providing requirements with
10respect to receipt, possession, storage, and transport of
11unstamped cigarette packages; creating s. 210.085, F.S.;
12requiring manufacturers, importers, distributing agents,
13dealers, and retail dealers to hold a current, valid
14permit to sell, distribute, or receive cigarettes;
15amending s. 210.09, F.S.; providing notice and filing
16guidelines for certain person shipping unstamped cigarette
17packages; authorizing certain law enforcement officials to
18inspect certain shipping vehicles; requiring wholesale
19dealers to submit certain reports; providing criteria for
20reports; authorizing the Division of Alcoholic Beverages
21and Tobacco to adopt rules; providing for access to
22certain records; amending s. 210.12, F.S.; authorizing the
23state to claim certain property and materials from certain
24dealers and retailers who attempt to defraud the state;
25authorizing the destruction of certain cigarettes;
26amending s. 210.15, F.S.; providing criteria for permit
27application; prohibiting issuance, maintenance, or renewal
28of certain permits for certain applicants; providing
29guidelines for permit application denial; amending s.
30210.18, F.S.; expanding the group of violators subject to
31criminal liability; prohibiting the sale or possession for
32sale of counterfeit cigarettes; providing penalties;
33creating s. 210.181, F.S.; providing civil penalties for
34failure to comply with certain duties or pay certain
35taxes; providing an effective date.
36
37Be It Enacted by the Legislature of the State of Florida:
38
39     Section 1.  Subsections (6) and (7) of section 210.01,
40Florida Statutes, are amended, and subsections (19) through (23)
41are added to said section, to read:
42     210.01  Definitions.--When used in this part the following
43words shall have the meaning herein indicated:
44     (6)  "Wholesale dealer" means any person located inside or
45outside this state who sells cigarettes to retail dealers or
46other persons for purposes of resale only, or any person who
47operates more than one cigarette vending machine located in more
48than one place of business. Such term shall not include any
49cigarette manufacturer, export warehouse proprietor, or importer
50with a valid permit under 26 U.S.C. s. 5712 if such person sells
51or distributes cigarettes in this state only to dealers who are
52agents and who hold valid and current permits under s. 210.15 or
53to an export warehouse proprietor or another manufacturer.
54     (7)  "Retail dealer" means any person located inside or
55outside this state other than a wholesale dealer engaged in the
56business of selling cigarettes, including persons licensed
57pursuant to s. 569.003.
58     (19)  "Stamp" or "stamps" means the indicia required to be
59placed on cigarette packages that evidences payment of the tax
60on cigarettes under s. 210.02.
61     (20)  "Importer" means any person with a valid permit under
6226 U.S.C. s. 5712 who imports into the United States, directly
63or indirectly, a finished cigarette for sale or distribution.
64     (21)  "Manufacturer" means any person with a valid permit
65under 26 U.S.C. s. 5712 who manufactures, fabricates, assembles,
66processes, or labels a finished cigarette.
67     (22)  "Counterfeit cigarettes" means cigarettes that have
68false manufacturing labels, tobacco product packs without tax
69stamps or with counterfeit tax stamps, or any combination
70thereof.
71     (23)  "Brand family" means all styles of cigarettes sold
72under the same trademark and differentiated from one another by
73means of additional modifiers or descriptors, including, but not
74limited to, "menthol," "lights," "kings," and "100s," and
75includes any brand name used alone or in conjunction with any
76other word, trademark, logo, symbol, motto, selling message,
77recognizable pattern of colors, or any other indicia of product
78identification identical or similar to, or identifiable with, a
79previously known brand of cigarettes.
80     Section 2.  Subsection (6) is added to section 210.05,
81Florida Statutes, to read:
82     210.05  Preparation and sale of stamps; discount.--
83     (6)(a)  A person may not transport or cause to be
84transported from this state cigarettes for sale in another state
85without first affixing to the cigarettes the stamp required by
86the state in which the cigarettes are to be sold or paying any
87other excise tax on the cigarettes imposed by the state in which
88the cigarettes are to be sold.
89     (b)  A person may not affix to cigarettes the stamp
90required by another state or pay any other excise tax on the
91cigarettes imposed by another state if the other state prohibits
92stamps from being affixed to the cigarettes, prohibits the
93payment of any other excise tax on the cigarettes, or prohibits
94the sale of the cigarettes.
95     (c)  On or before the 10th day of each month, a person who
96transports or causes to be transported from this state
97cigarettes for sale in another state shall submit to the
98division a report identifying the quantity and brand family of
99each brand of the cigarettes transported or caused to be
100transported in the preceding calendar quarter and the name and
101address of each recipient of the cigarettes.
102     (d)  For purposes of this section, the term "person" means
103an individual, partnership, committee, association, corporation,
104or any other organization or group of persons. Person does not
105include any common or contract carrier, or public warehouse that
106is not owned, in whole or in part, directly or indirectly, by
107such person.
108     Section 3.  Subsection (1) of section 210.06, Florida
109Statutes, is amended, and subsection (5) is added to said
110section, to read:
111     210.06  Affixation of stamps; presumption.--
112     (1)  Every dealer within or without the state shall affix
113or cause to be affixed to such package or container of such
114cigarettes such, stamps as are required under this section
115within 10 days after receipt of such products. Dealers outside
116this state shall affix such stamps before the shipment of
117cigarettes into this state, evidencing the payment of the tax
118imposed by virtue of this part before such cigarettes are
119offered for sale or use or consumed or before they are otherwise
120disposed of in the state.
121     (a)  A tax stamp shall be applied to all cigarette packages
122intended for sale or distribution to consumers subject to the
123tax imposed under s. 210.02, including cigarettes subject to
124reduced state tax under s. 210.04(4)(b).
125     (b)  No stamp shall be applied to any cigarette package
126exempt from tax under 26 U.S.C. s. 5704 that is distributed by a
127manufacturer pursuant to federal regulations.
128     (c)  Dealers may apply stamps only to cigarette packages
129received directly from a manufacturer or importer of cigarettes
130who possesses a valid and current permit under 26 U.S.C. s.
1315712.
132     (5)  Except as provided in s. 210.09(1), no person, other
133than a dealer that receives unstamped cigarette packages
134directly from a cigarette manufacturer or importer in accordance
135with this section and s. 210.085, shall hold or possess an
136unstamped cigarette package. Dealers shall be permitted to set
137aside, without application of stamps, only such part of the
138dealer's stock that is identified for sale or distribution
139outside this state. If a dealer maintains stocks of unstamped
140cigarette packages, such unstamped packages shall be stored
141separately from stamped product packages. No unstamped cigarette
142packages shall be transferred by a dealer to another facility of
143the dealer within this state or to another person within this
144state.
145     Section 4.  Section 210.085, Florida Statutes, is created
146to read:
147     210.085  Transactions only with permitted manufacturers,
148importers, distributing agents, dealers, and retail dealers.--A
149manufacturer, importer, or distributing agent may sell or
150distribute cigarettes to a person located or doing business
151within this state, including on any tribal lands located within
152the borders of this state, only if such person is a dealer with
153a valid, current permit under s. 210.15. A dealer may sell or
154distribute cigarettes to a person located or doing business
155within this state, including on any tribal lands located within
156the borders of this state, only if such person is a dealer or
157retail dealer with a valid, current permit under s. 569.003. A
158dealer may obtain cigarettes only from a manufacturer or
159importer who possesses a valid, current permit under 26 U.S.C.
160s. 5712 or from a distributing agent or dealer with a valid,
161current permit under s. 210.15. A retail dealer may obtain
162cigarettes only from a manufacturer or dealer with a valid,
163current permit under s. 210.15.
164     Section 5.  Subsections (1) and (2) of section 210.09,
165Florida Statutes, are amended, and subsection (6) is added to
166said section, to read:
167     210.09  Records to be kept; reports to be made;
168examination.--
169     (1)(a)  Every person who shall possess or transport any
170unstamped cigarettes upon the public highways, roads, or streets
171of the state, shall be required to have in his or her actual
172possession invoices or delivery tickets for such cigarettes. The
173absence of such invoices or delivery tickets shall be prima
174facie evidence that such person is a dealer in cigarettes in
175this state and subject to the provisions of this part.
176     (b)  Any person who ships unstamped cigarette packages into
177this state other than to a dealer holding a valid, current
178permit pursuant to s. 210.15 shall first file with the division
179a notice of such shipment. This paragraph shall not apply to any
180common or contract carrier that is transporting cigarettes
181through this state to another location outside this state under
182a proper bill of lading or freight bill that states the
183quantity, source, and destination of such cigarettes.
184     (c)  In any case in which the division or its duly
185authorized agent, or any law enforcement officer of this state,
186has knowledge or reasonable grounds to believe that any vehicle
187is transporting cigarettes in violation of this part, the
188division, such agent, or such law enforcement officer is
189authorized to stop such vehicle and inspect the vehicle for
190contraband cigarettes.
191     (2)(a)  Except as otherwise provided in this subsection,
192the division is authorized to prescribe and promulgate by rules
193and regulations, which shall have the force and effect of the
194law, such records to be kept and reports to be made to the
195division by any distributing agent, wholesale dealer, retail
196dealer, common carrier, or any other person handling,
197transporting or possessing cigarettes for sale or distribution
198within the state as may be necessary to collect and properly
199distribute the taxes imposed by s. 210.02. All reports shall be
200made on or before the 10th day of the month following the month
201for which the report is made, unless the division by rule or
202regulation shall prescribe that reports be made more often.
203     (b)  Each wholesale dealer shall submit to the division
204monthly reports setting forth the following information,
205itemized or submitted separately for each place of business of
206such dealer:
207     1.  The quantities of cigarettes, by brand family, on hand
208both at the beginning and end of the reporting period.
209     2.  The quantities of cigarettes, by brand family and
210transaction, that were received during the reporting period and
211the name and address of each person from whom those products
212were received.
213     3.  The quantities of cigarettes, by brand family and
214transaction, distributed or shipped during the reporting period,
215other than sales directly to consumers, and the name and address
216of each person to whom those products were distributed or
217shipped.
218     (c)  Manufacturers and importers shipping cigarettes into
219or within this state shall file a monthly report with the
220division containing the information regarding such cigarettes
221set forth in paragraph (b).
222     (d)  The reports submitted pursuant to paragraphs (a), (b),
223and (c) shall be further itemized to disclose the quantity of
224reported cigarettes bearing tax stamps of this state, stamps of
225another state, and unstamped cigarettes, itemized to show, if
226known, the portion of the unstamped cigarettes that are intended
227for sale or distribution in this state. Dealer reports shall
228include, if applicable, the quantity of tax stamps of this state
229that were not affixed to cigarettes and that were on hand at the
230beginning and end of the reporting period, the quantity of each
231type of stamp of this state received during the reporting
232period, and the quantity of each type of stamp of this state
233applied during the reporting period.
234     (e)  The division may adopt rules requiring such additional
235information in the monthly reports as is necessary or
236appropriate for purposes of enforcing the provisions of this
237part.
238     (6)  The United States Secretary of the Treasury or his or
239her designee shall have access to records and reports required
240by this section. The division may share such records and reports
241with law enforcement officials of this state, the Federal
242Government, or other states.
243     Section 6.  Subsection (1) of section 210.12, Florida
244Statutes, is amended, subsections (2) through (6) of said
245section are renumbered as subsections (4) through (8),
246respectively, and new subsections (2) and (3) are added to said
247section, to read:
248     210.12  Seizures; forfeiture proceedings.--
249     (1)  The state, acting by and through the division, shall
250be authorized and empowered to seize, confiscate, and forfeit
251for the use and benefit of the state, any cigarettes upon which
252taxes payable hereunder may be unpaid or that are otherwise held
253in violation of the requirements of this chapter, and also any
254vending machine or receptacle in which such cigarettes upon
255which taxes have not been paid are held for sale, or any vending
256machine that does not have affixed thereto the identification
257sticker required by the provisions of s. 210.07, or which does
258not display at all times at least one package of each brand of
259cigarettes located therein so the same is clearly visible and
260arranged in such a manner that the cigarette tax stamp or meter
261impression of the stamp affixed thereto is clearly visible. Such
262seizure may be made by the division, its duly authorized
263representative, any sheriff or deputy sheriff, or any police
264officer.
265     (2)  All fixtures, equipment, and other materials and
266personal property on the premises of any dealer or retail dealer
267who, with intent to defraud the state, fails to keep or make any
268record, return, report, or inventory required by this part;
269keeps or makes any false or fraudulent record, return, report,
270or inventory required by this part; refuses to pay any tax
271imposed by this part; or attempts in any manner to evade or
272defeat the requirements of this part shall be forfeited to the
273state.
274     (3)  All cigarettes seized, confiscated, and forfeited to
275the state under this part shall be destroyed.
276     Section 7.  Subsection (1) of section 210.15, Florida
277Statutes, is amended to read:
278     210.15  Permits.--
279     (1)(a)  Every person, firm, or corporation desiring to
280engage in business as a manufacturer, importer, exporter,
281distributing agent, or wholesale dealer of cigarettes deal in
282cigarettes as a distributing agent, wholesale dealer, or
283exporter within this state shall file with the division an
284application for a cigarette permit for each place of business
285located within this state or, in the absence of such place of
286business in this state, for wherever its principal place of
287business is located with the Division of Alcoholic Beverages and
288Tobacco. Every application for a cigarette permit shall be made
289on forms furnished by the division and shall set forth the name
290under which the applicant transacts or intends to transact
291business, the location of the applicant's place of business
292within the state, if any, and such other information as the
293division may require. If the applicant has or intends to have
294more than one place of business dealing in cigarettes within
295this state, the application shall state the location of each
296place of business. If the applicant is an association, the
297application shall set forth the names and addresses of the
298persons constituting the association, and if a corporation, the
299names and addresses of the principal officers thereof and any
300other information prescribed by the division for the purpose of
301identification. The application shall be signed and verified by
302oath or affirmation by the owner, if a natural person, and in
303the case of an association or partnership, members or partners
304thereof, and in the case of a corporation, by an executive
305officer thereof or by any person specifically authorized by the
306corporation to sign the application, to which shall be attached
307the written evidence of this authority. The cigarette permit for
308a distributing agent shall be issued annually for which an
309annual fee of $5 shall be charged.
310     (b)  The holder of any duly issued, annual permit for a
311distributing agent shall be entitled to a renewal of his or her
312annual permit from year to year as a matter of course, on or
313before July 1, upon making application to the division and upon
314payment of this annual permit fee.
315     (c)  Permits The permit for a distributing agent, wholesale
316dealer, or exporter shall be issued only to persons of good
317moral character, who are not less than 18 years of age.
318Distributing agent, wholesale dealer, or exporter Permits to
319corporations shall be issued only to corporations whose officers
320are of good moral character and not less than 18 years of age.
321There shall be no exemptions from the permit fees herein
322provided to any persons, association of persons, or corporation,
323any law to the contrary notwithstanding.
324     (d)  No distributing agent, wholesale dealer, or exporter
325permit shall be issued, maintained, or renewed if the applicant,
326its officers, or any person or persons owning directly or
327indirectly, in the aggregate, more than 10 percent of the
328ownership interests in the applicant:
329     1.  Owes $500 or more in delinquent cigarette taxes;
330     2.  Had a cigarette importer, retail dealer, or dealer
331permit revoked by the division within the previous 2 years;
332     3.  Has been convicted of selling stolen or counterfeit
333cigarettes, receiving stolen cigarettes, or being involved in
334the counterfeiting of cigarettes; or
335     4.  Has been convicted in this state, any other state, or
336the United States of any offense designated as a felony by such
337state or the United States within 15 years prior to applying for
338a permit to any person who has been convicted within the past 5
339years of any offense against the cigarette laws of this state or
340who has been convicted in this state, any other state, or the
341United States during the past 5 years of any offense designated
342as a felony by such state or the United States, or to a
343corporation, any of whose officers have been so convicted. The
344term "convicted" "conviction" shall include an adjudication of
345guilt on a plea of guilty or a plea of nolo contendere, or the
346forfeiture of a bond when charged with a crime.
347     (e)(d)  The division shall may refuse to issue a
348distributing agent, wholesale, or exporter permit to any person,
349firm, or corporation whose permit under the cigarette law has
350been revoked or to any corporation, an officer of which has had
351his or her permit under the cigarette law revoked, or to any
352person who is or has been an officer of a corporation whose
353permit has been revoked under the cigarette law. Any permit
354issued to a firm or corporation prohibited from obtaining such
355permit under the cigarette law shall may be revoked by the
356division.
357     (f)(e)  Prior to an application for a distributing agent,
358wholesale dealer, or exporter permit being approved, the
359applicant shall file a set of fingerprints on forms provided by
360the division. The applicant shall also file a set of
361fingerprints for any person or persons interested directly or
362indirectly with the applicant in the business for which the
363permit is being sought, when so required by the division. If the
364applicant or any person interested with the applicant, either
365directly or indirectly, in the business for which the permit is
366sought shall be such a person as is within the definition of
367persons to whom a distributing agent, wholesale dealer, or
368exporter permit shall be denied, then the application may be
369denied by the division. If the applicant is a partnership, all
370members of the partnership are required to file said
371fingerprints, or if a corporation, all principal officers of the
372corporation are required to file said fingerprints. The
373cigarette permit for a wholesale dealer or exporter shall be
374originally issued at a fee of $100, which sum is to cover the
375cost of the investigation required before issuing such permit.
376     (g)(f)  The cigarette permits issued under this section
377permit for a wholesale dealer or exporter shall be renewed from
378year to year as a matter of course, at an annual cost of $100,
379on or before July 1, upon making application to the division and
380upon payment of the annual renewal fee.
381     (h)(g)  Permittees, by acceptance of their permits, agree
382that their places of business or vehicles transporting
383cigarettes shall always be subject to be inspected and searched
384without a search warrant for the purpose of ascertaining that
385all provisions of this part are complied with by authorized
386employees of the division and also by sheriffs, deputy sheriffs,
387and police officers during business hours or during any other
388time such premises are occupied by the permittee or other
389persons. Retail cigarette dealers and manufacturers'
390representatives, by dealing in cigarettes, agree that their
391places of business or vehicles transporting cigarettes shall
392always be subject to inspection and search without a search
393warrant for the purpose of ascertaining that all provisions of
394this part are complied with by authorized employees of the
395division and also by sheriffs, deputy sheriffs, and police
396officers during business hours or other times when the premises
397are occupied by the retail dealer or manufacturers'
398representatives or other persons.
399     (i)(h)  No retail sales of cigarettes may be made at a
400location for which a wholesale dealer, distributing agent, or
401exporter permit has been issued. The excise tax on sales made to
402any traveling location, such as an itinerant store or industrial
403caterer, shall be paid into the General Revenue Fund
404unallocated. Cigarettes may be purchased for retail purposes
405only from a person holding a wholesale dealer permit. The
406invoice for the purchase of cigarettes must show the place of
407business for which the purchase is made and the cigarettes
408cannot be transferred to any other place of business for the
409purpose of resale.
410     Section 8.  Subsections (2), (3), and (6) of section
411210.18, Florida Statutes, are amended, and subsection (9) is
412added to said section, to read:
413     210.18  Penalties for tax evasion; reports by sheriffs.--
414     (2)  Except as otherwise provided in this section, any
415person wholesale or retail dealer who fails, neglects, or
416refuses to comply with, or violates the provisions of, this part
417or the rules adopted and regulations promulgated by the division
418under this part commits is guilty of a misdemeanor of the first
419degree, punishable as provided in s. 775.082 or s. 775.083. Any
420person wholesale or retail dealer who has been convicted of a
421violation of any provision of the cigarette tax law and who is
422thereafter convicted of a further violation of the cigarette tax
423law is, upon conviction of such further offense, guilty of a
424felony of the third degree, punishable as provided in s.
425775.082, s. 775.083, or s. 775.084.
426     (3)  Any person who falsely or fraudulently makes, forges,
427alters, or counterfeits any stamp or impression die used in
428meter machines prescribed by the division under the provisions
429of this part; or, with intent to evade taxes, jams, tampers
430with, or alters such a machine; or causes or procures to be
431falsely or fraudulently made, forged, altered, or counterfeited
432any such stamp or die; or knowingly and willfully utters,
433purchases, passes or tenders as true any such false, altered, or
434counterfeited stamp or die impression; or with the intent to
435defraud the state, fails to comply with any other requirement of
436this chapter commits is guilty of a felony of the third degree,
437punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
438     (6)(a)  Every person, firm, or corporation, other than a
439licensee under the provisions of this part, who possesses,
440removes, deposits, or conceals, or aids in the possessing,
441removing, depositing, or concealing of, any unstamped cigarettes
442not in excess of 50 cartons is guilty of a misdemeanor of the
443second degree, punishable as provided in s. 775.082 or s.
444775.083. In lieu of the penalties provided in those sections,
445however, the person, firm, or corporation may pay the tax plus a
446penalty equal to the amount of the tax authorized under s.
447210.02 on the unstamped cigarettes.
448     (a)(b)  Every person, firm, or corporation, other than a
449licensee under the provisions of this part, who possesses,
450removes, deposits, or conceals, or aids in the possessing,
451removing, depositing, or concealing of, any unstamped cigarettes
452in excess of 50 cartons is presumed to have knowledge that they
453have not been taxed and commits is guilty of a felony of the
454third degree, punishable as provided in s. 775.082, s. 775.083,
455or s. 775.084.
456     (b)(c)  This section does not apply to a person possessing
457not in excess of three cartons of such cigarettes purchased by
458such possessor outside the state in accordance with the laws of
459the place where purchased and brought into this state by such
460possessor. The burden of proof that such cigarettes were
461purchased outside the state and in accordance with the laws of
462the place where purchased shall in all cases be upon the
463possessor of such cigarettes.
464     (9)  Notwithstanding any other provision of law, the sale
465or possession for sale of counterfeit cigarettes by any person
466or by a manufacturer, importer, distributing agent, wholesale
467dealer, or retail dealer shall result in the seizure of the
468product and related machinery by the division or any law
469enforcement agency and shall be punishable as follows:
470     (a)1.  A first violation with a total quantity of less than
471two cartons of cigarettes or the equivalent amount of other
472cigarettes shall be punishable by a fine not to exceed $1,000 or
473five times the retail value of the cigarettes involved,
474whichever is greater, or imprisonment not to exceed 5 years, or
475both.
476     2.  A subsequent violation with a total quantity of less
477than two cartons of cigarettes or the equivalent amount of other
478cigarettes shall be punishable by a fine not to exceed $5,000 or
479five times the retail value of the cigarettes involved,
480whichever is greater, or imprisonment not to exceed 5 years, or
481both, and shall also result in the revocation by the division of
482the permit of the manufacturer, importer, distributing agent,
483wholesale dealer, or retail dealer.
484     (b)1.  A first violation with a total quantity of two or
485more cartons of cigarettes or the equivalent amount of other
486cigarettes shall be punishable by a fine not to exceed $2,000 or
487five times the retail value of the cigarettes involved,
488whichever is greater, or imprisonment not to exceed 5 years, or
489both.
490     2.  A subsequent violation with a quantity of two cartons
491of cigarettes or more or the equivalent amount of other
492cigarettes shall be punishable by a fine not to exceed $50,000
493or five times the retail value of the cigarettes involved,
494whichever is greater, or imprisonment not to exceed 5 years, or
495both, and shall also result in the revocation by the division of
496the permit of the manufacturer, importer, distributing agent,
497wholesale dealer, or retail dealer.
498
499For purposes of this subsection, any counterfeit cigarettes
500seized by the division shall be destroyed.
501     Section 9.  Section 210.181, Florida Statutes, is created
502to read:
503     210.181  Civil penalties.--
504     (1)  Whoever knowingly omits, neglects, or refuses to
505comply with any duty imposed upon him or her by this part, or to
506do or cause to be done any of the things required by this part,
507or does anything prohibited by this part shall, in addition to
508any other penalty provided in this part, be liable for a fine of
509$1,000 or five times the retail value of the cigarettes
510involved, whichever is greater.
511     (2)  Whoever fails to pay any tax imposed by this part at
512the time prescribed by law or rules shall, in addition to any
513other penalty provided in this part, be liable for a penalty of
514five times the unpaid tax due.
515     Section 10.  This act shall take effect upon becoming a
516law.


CODING: Words stricken are deletions; words underlined are additions.