102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
SB1706

 

Introduced 2/26/2021, by Sen. Cristina Castro

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 143/10-5

    Amends the Tobacco Products Tax Act of 1995. Provides that specified components of an "electronic cigarette" do not include any solution or substance that contains cannabis subject to tax under the Compassionate Use of Medical Cannabis Program Act or the Cannabis Cultivation Privilege Tax Law. Effective immediately.


LRB102 16571 CPF 21968 b

 

 

A BILL FOR

 

SB1706LRB102 16571 CPF 21968 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Tobacco Products Tax Act of 1995 is amended
5by changing Section 10-5 as follows:
 
6    (35 ILCS 143/10-5)
7    Sec. 10-5. Definitions. For purposes of this Act:
8    "Business" means any trade, occupation, activity, or
9enterprise engaged in, at any location whatsoever, for the
10purpose of selling tobacco products.
11    "Cigarette" has the meaning ascribed to the term in
12Section 1 of the Cigarette Tax Act.
13    "Contraband little cigar" means:
14        (1) packages of little cigars containing 20 or 25
15    little cigars that do not bear a required tax stamp under
16    this Act;
17        (2) packages of little cigars containing 20 or 25
18    little cigars that bear a fraudulent, imitation, or
19    counterfeit tax stamp;
20        (3) packages of little cigars containing 20 or 25
21    little cigars that are improperly tax stamped, including
22    packages of little cigars that bear only a tax stamp of
23    another state or taxing jurisdiction; or

 

 

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1        (4) packages of little cigars containing other than 20
2    or 25 little cigars in the possession of a distributor,
3    retailer or wholesaler, unless the distributor, retailer,
4    or wholesaler possesses, or produces within the time frame
5    provided in Section 10-27 or 10-28 of this Act, an invoice
6    from a stamping distributor, distributor, or wholesaler
7    showing that the tax on the packages has been or will be
8    paid.
9    "Correctional Industries program" means a program run by a
10State penal institution in which residents of the penal
11institution produce tobacco products for sale to persons
12incarcerated in penal institutions or resident patients of a
13State operated mental health facility.
14    "Department" means the Illinois Department of Revenue.
15    "Distributor" means any of the following:
16        (1) Any manufacturer or wholesaler in this State
17    engaged in the business of selling tobacco products who
18    sells, exchanges, or distributes tobacco products to
19    retailers or consumers in this State.
20        (2) Any manufacturer or wholesaler engaged in the
21    business of selling tobacco products from without this
22    State who sells, exchanges, distributes, ships, or
23    transports tobacco products to retailers or consumers
24    located in this State, so long as that manufacturer or
25    wholesaler has or maintains within this State, directly or
26    by subsidiary, an office, sales house, or other place of

 

 

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1    business, or any agent or other representative operating
2    within this State under the authority of the person or
3    subsidiary, irrespective of whether the place of business
4    or agent or other representative is located here
5    permanently or temporarily.
6        (3) Any retailer who receives tobacco products on
7    which the tax has not been or will not be paid by another
8    distributor.
9    "Distributor" does not include any person, wherever
10resident or located, who makes, manufactures, or fabricates
11tobacco products as part of a Correctional Industries program
12for sale to residents incarcerated in penal institutions or
13resident patients of a State operated mental health facility.
14    "Electronic cigarette" means:
15        (1) any device that employs a battery or other
16    mechanism to heat a solution or substance to produce a
17    vapor or aerosol intended for inhalation, except any
18    device that contains a solution or substance that contains
19    cannabis subject to tax under the Compassionate Use of
20    Medical Cannabis Program Act or the Cannabis Cultivation
21    Privilege Tax Law;
22        (2) any cartridge or container of a solution or
23    substance intended to be used with or in the device or to
24    refill the device, except any cartridge or container of a
25    solution or substance that contains cannabis subject to
26    tax under the Compassionate Use of Medical Cannabis

 

 

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1    Program Act or the Cannabis Cultivation Privilege Tax Law;
2    or
3        (3) any solution or substance, whether or not it
4    contains nicotine, intended for use in the device, except
5    any solution or substance that contains cannabis subject
6    to tax under the Compassionate Use of Medical Cannabis
7    Program Act or the Cannabis Cultivation Privilege Tax Law.
8    The changes made to the definition of "electronic
9    cigarette" by this amendatory Act of the 102nd General
10    Assembly apply on and after June 28, 2020, but no claim for
11    credit or refund is allowed on or after the effective date
12    of this amendatory Act of the 102nd General Assembly for
13    such taxes paid during the period beginning June 28, 2020
14    and the effective date of this amendatory Act of the 102nd
15    General Assembly.
16    "Electronic cigarette" includes, but is not limited to,
17any electronic nicotine delivery system, electronic cigar,
18electronic cigarillo, electronic pipe, electronic hookah, vape
19pen, or similar product or device, and any component or part
20that can be used to build the product or device. "Electronic
21cigarette" does not include: cigarettes, as defined in Section
221 of the Cigarette Tax Act; any product approved by the United
23States Food and Drug Administration for sale as a tobacco
24cessation product, a tobacco dependence product, or for other
25medical purposes that is marketed and sold solely for that
26approved purpose; any asthma inhaler prescribed by a physician

 

 

SB1706- 5 -LRB102 16571 CPF 21968 b

1for that condition that is marketed and sold solely for that
2approved purpose; or any therapeutic product approved for use
3under the Compassionate Use of Medical Cannabis Program Act.
4    "Little cigar" means and includes any roll, made wholly or
5in part of tobacco, where such roll has an integrated
6cellulose acetate filter and weighs less than 4 pounds per
7thousand and the wrapper or cover of which is made in whole or
8in part of tobacco.
9    "Manufacturer" means any person, wherever resident or
10located, who manufactures and sells tobacco products, except a
11person who makes, manufactures, or fabricates tobacco products
12as a part of a Correctional Industries program for sale to
13persons incarcerated in penal institutions or resident
14patients of a State operated mental health facility.
15    Beginning on January 1, 2013, "moist snuff" means any
16finely cut, ground, or powdered tobacco that is not intended
17to be smoked, but shall not include any finely cut, ground, or
18powdered tobacco that is intended to be placed in the nasal
19cavity.
20    "Person" means any natural individual, firm, partnership,
21association, joint stock company, joint venture, limited
22liability company, or public or private corporation, however
23formed, or a receiver, executor, administrator, trustee,
24conservator, or other representative appointed by order of any
25court.
26    "Place of business" means and includes any place where

 

 

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1tobacco products are sold or where tobacco products are
2manufactured, stored, or kept for the purpose of sale or
3consumption, including any vessel, vehicle, airplane, train,
4or vending machine.
5    "Retailer" means any person in this State engaged in the
6business of selling tobacco products to consumers in this
7State, regardless of quantity or number of sales.
8    "Sale" means any transfer, exchange, or barter in any
9manner or by any means whatsoever for a consideration and
10includes all sales made by persons.
11    "Stamp" or "stamps" mean the indicia required to be
12affixed on a package of little cigars that evidence payment of
13the tax on packages of little cigars containing 20 or 25 little
14cigars under Section 10-10 of this Act. These stamps shall be
15the same stamps used for cigarettes under the Cigarette Tax
16Act.
17    "Stamping distributor" means a distributor licensed under
18this Act and also licensed as a distributor under the
19Cigarette Tax Act or Cigarette Use Tax Act.
20    "Tobacco products" means any cigars, including little
21cigars; cheroots; stogies; periques; granulated, plug cut,
22crimp cut, ready rubbed, and other smoking tobacco; snuff
23(including moist snuff) or snuff flour; cavendish; plug and
24twist tobacco; fine-cut and other chewing tobaccos; shorts;
25refuse scraps, clippings, cuttings, and sweeping of tobacco;
26and other kinds and forms of tobacco, prepared in such manner

 

 

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1as to be suitable for chewing or smoking in a pipe or
2otherwise, or both for chewing and smoking; but does not
3include cigarettes as defined in Section 1 of the Cigarette
4Tax Act or tobacco purchased for the manufacture of cigarettes
5by cigarette distributors and manufacturers defined in the
6Cigarette Tax Act and persons who make, manufacture, or
7fabricate cigarettes as a part of a Correctional Industries
8program for sale to residents incarcerated in penal
9institutions or resident patients of a State operated mental
10health facility.
11    Beginning on July 1, 2019, "tobacco products" also
12includes electronic cigarettes.
13    "Wholesale price" means the established list price for
14which a manufacturer sells tobacco products to a distributor,
15before the allowance of any discount, trade allowance, rebate,
16or other reduction. In the absence of such an established list
17price, the manufacturer's invoice price at which the
18manufacturer sells the tobacco product to unaffiliated
19distributors, before any discounts, trade allowances, rebates,
20or other reductions, shall be presumed to be the wholesale
21price.
22    "Wholesaler" means any person, wherever resident or
23located, engaged in the business of selling tobacco products
24to others for the purpose of resale. "Wholesaler", when used
25in this Act, does not include a person licensed as a
26distributor under Section 10-20 of this Act unless expressly

 

 

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1stated in this Act.
2(Source: P.A. 101-31, eff. 6-28-19; 101-593, eff. 12-4-19.)
 
3    Section 99. Effective date. This Act takes effect upon
4becoming law.