Cigarette & Tobacco Product Taxes
Two types of excise taxes are collected on cigarette and tobacco products distributed in California:
- the cigarette tax and
- the cigarette and tobacco products surtax
What is the amount of the tax?
Cigarettes are subject to both the cigarette tax and the cigarette and tobacco products surtax. The tax and surtax are paid by distributors through the use of tax stamps, which are purchased from the Board of Equalization (BOE) and affixed to each package of cigarettes before distribution. The cost of the stamp includes both the cigarette tax and the surtax. Currently, each stamp costs 87 cents per pack of 20 cigarettes, comprising 12 cents for the cigarette tax and 75 cents for the combined surtax.
Tobacco products, not including cigarettes, are subject only to the cigarette and tobacco products surtax. Tobacco products include all forms of cigars, smoking tobacco, chewing tobacco, and snuff, as well as other products containing at least 50 percent tobacco. Effective July 1, 2011, through June 30, 2012, the rate is 31.73 percent.
For more information on cigarette and tobacco product taxes, please review Publication 93, California Cigarette and Tobacco Product Taxes.
Common carriers making deliveries of shipments of cigarettes into California must obtain a permit and report their deliveries to the BOE. Click here
Cigarette and tobacco product tax evasion is a serious crime.
Cigarette and tobacco product tax evasion is a serious and expanding problem in California and other states. Tax evasion cheats programs that provide essential services for the state's residents and hurts honest businesspeople.
Retailers who purchase cigarettes or tobacco products from other than licensed wholesalers and distributors should be aware that they are in violation of the law and these products are subject to seizure by the BOE.
The BOE's Investigation Division actively investigates and makes seizures of unstamped or counterfeit stamped cigarettes and imports of domestic labeled cigarettes or export type cigarettes stamped in violation of the law.
A retailer's best defense against dealing in products subject to seizure is to purchase cigarettes from a licensed cigarette wholesaler or distributor and to obtain a purchase receipt that contains the proper information. Under regulation 4092, Receipt for Tax Paid to Distributors, every cigarette distributor is required to give the retailer a receipt. A proper sales invoice, together with evidence of payment, constitutes a valid receipt.
If you have any concerns or questions about the product you are purchasing, contact us:
Special Taxes and Fees, MIC:88
State Board of Equalization
P.O. Box 942879
Sacramento, CA 94279-0088