May 27, 2016
New Law Raises Licensing Fees for Cigarettes and Tobacco Products
Sacramento – Sellers of cigarettes and tobacco products will see their licensing fees increase starting June 9, 2016. The increased fees are a result of Assembly Bill x2 11, which was signed into law on May 4 and increases the Cigarette and Tobacco Products License application and renewal fees for retailers, wholesalers, and distributors to provide additional funding for cigarette and tobacco products tax compliance. This new law is effective the same day that the age for purchasing cigarettes and tobacco products raises from 18 to 21 years old. License applications can be submitted through the Board of Equalization's (BOE) online registration system.
The BOE administers a statewide program to license cigarette and tobacco products manufacturers, importers, distributors, wholesalers, and retailers (Cigarette and Tobacco Products Licensing Act of 2003). Currently, retailers pay a one-time licensing fee of $100 per location where these products are sold. The new law will require them to pay $265 annually for each location. Distributors and wholesalers currently pay $1,000 per calendar year per location. The new law will require them to pay $1,200 per calendar year per location.
Listed below are the fees that go into effect on June 9, 2016 for all new licenses.
|License Type||Old Application Fee
(On or before June 8, 2016)
|New Application Fee
(On or After June 9, 2016)
|Retailer||$100 per location||$265 per location|
|Wholesaler/Distributor||$1,000 per location||$1,200 per location|
Beginning January 1, 2017, the new law also imposes an annual renewal fee of $265 for retailer licenses and increases the wholesaler and distributor license annual renewal fee to $1,200. The new renewal fee amounts are shown below.
|License Type||Old Renewal Fee
(On or before December 31, 2016)
|New Renewal Fee
(On or After January 1, 2017)
|Retailer||$0||$265 per location per year|
|Wholesaler/Distributor||$1,000 per location per calendar year||$1,200 per location per calendar year|
The five-member California State Board of Equalization (BOE) is a publicly elected tax board. The BOE collects $60.5 billion annually in taxes and fees supporting state and local government services. It hears business tax appeals, acts as the appellate body for franchise and personal income tax appeals, and serves a significant role in the assessment and administration of property taxes. For more information on other taxes and fees, visit the California Tax Service Center.
Note: This news release may discuss complex tax laws and concepts. It may not address every situation, and is not considered written advice under Revenue and Taxation Code section 6596. Changes in law or regulations may have occurred since the time this news release was written. If there is a conflict between the text of this news release and the law, decisions will be based upon the law and not this news release. For specific help, please contact the BOE at 1-800-400-7115.