HB277 Alabama 2012 Session

Summary

Primary Sponsor

Jamie Ison

Republican

Co-Sponsors

Jim BartonMary Sue McClurkin

Session

Regular Session 2012

Title

Taxation, tobacco products, tax on cigar wrappers, require business license, monthly reports, penalties, Secs. 40-25B-1 to 40-25B-11, inclusive, added

Summary

HB277 would impose a new tax on cigar wrappers in Alabama, require licensing and monthly reporting, and specify how the revenue is collected, enforced, and distributed.

What This Bill Does

It adds a tax on cigar wrappers with tiered rates based on weight, and requires licenses for those selling taxed wrappers. Sellers must file monthly reports and pay the tax by the 20th of each month; penalties apply for noncompliance. There is an exemption for cigar manufacturers who use wrappers on finished cigars, and the tax is administered and enforced by the Department of Revenue with proceeds distributed under existing tobacco funding rules; salaries and operating costs are paid as a first charge. The act becomes effective on the first day of the third month after passage.

Who It Affects

• Retailers, wholesalers, and other sellers of cigar wrappers in Alabama who must obtain a license, file monthly tax reports, and pay the tax.
• Cigar manufacturers and other businesses that use tobacco wrappers on finished cigars, who are exempt from the tax for wrappers used on finished cigars; the Department of Revenue administers and enforces the tax.

Key Provisions

• Adds new definitions and creates Section 40-25B-1 and 40-25B-2.1 to levy a tax on cigar wrappers manufactured or imported for sale in Alabama, with specific weight-based rates.
• Tax rates: 4 cents for wrappers not exceeding 1 1/8 ounces; 10 cents for >1 1/8 to 2 ounces; 16 cents for >2 to 3 ounces; 21 cents for >3 to 4 ounces; plus 6 cents for each additional ounce or fraction above 4 ounces.
• Exception: cigar manufacturers using wrappers on finished cigars for sale at retail are not subject to this tax.
• Licensing: before selling taxed items, a license must be obtained from the Department of Revenue, and license is a prerequisite to engaging in the business.
• Reporting and payment: by the 20th day of each month, taxpayers must file a true and correct report and pay the tax due using forms prescribed by the department.
• Penalties: failure to report or maintain required records is a Class B misdemeanor, with each month of noncompliance treated as a separate offense.
• Administration and enforcement: the Department of Revenue enforces the chapter, can adopt rules, and may take action against noncompliant taxpayers.
• Extensions: the department may grant up to a 30-day extension for filing, for good cause.
• Revenue distribution: all net tax proceeds go to the department and are distributed as provided for tobacco funds in Section 40-25-23; expenditures for department salaries and operations are first charged against these funds.
• Effective date: becomes law on the first day of the third month after passage and approval.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation