HB9 Alabama 2015 1st Special Session

Summary

Primary Sponsor

Mike Hill

Republican

Session

First Special Session 2015

Title

Tobacco tax, increased, discount on stamps adjusted, privilege license tax on consumable nicotine vapor products, Secs. 40-12-72, 40-12-73, 40-25-2, 40-25-2.1, 40-25-5, 40-25-23, 40-25-40, 40-25-41 am'd.

Summary

HB9 would raise tobacco taxes, impose a nicotine vapor product tax, require licenses for vapor-product sellers, and curb selling cigarettes below cost.

What This Bill Does

The bill increases the state tax on cigarettes and other tobacco products, adjusts the discount on tobacco stamp purchases, and adds a new tax on consumable nicotine vapor products. It requires wholesalers and retailers of vapor products to obtain an annual license, collect the tax at sale, and file monthly reports. It also creates the Unfair Retailer’s Cigarette Sales Law to prohibit selling cigarettes below cost and provides penalties and civil remedies for violations, with tax revenue distributed to several state funds and programs.

Who It Affects

• Retailers and wholesalers of tobacco and vapor products will need to obtain licenses, collect and remit taxes, report monthly, and maintain records; they may face penalties for noncompliance.
• Consumers in Alabama may experience higher prices for cigarettes, other tobacco products, and vapor products due to the new and increased taxes; enforcement against below-cost cigarette sales could indirectly affect pricing dynamics.

Key Provisions

• License and tax changes: Amends multiple sections to increase taxes on cigarettes and other tobacco products and to establish annual privilege license taxes for retail and wholesale dealers of consumable vapor products, with license amounts based on city population.
• Vapor product tax: Adds a new section (40-25-2.2) imposing an excise tax of $0.25 per milliliter on consumable vapor products containing nicotine, with defined terms and specific exemptions (outside-state sales and sales to the federal government); requires monthly reporting and deposits to the General Fund.
• Tax administration for tobacco: Maintains stamps and related administration for tobacco taxes, with rules on collection, stamping, compliance, and penalties for noncompliance, including a Class B misdemeanor for failing to report or keep required records.
• Unfair Retailer’s Cigarette Sales Law: Adds Chapter 37 to Title 8 prohibiting retailers from advertising, offering, or selling cigarettes at less than cost to the retailer; establishes definitions (basic cost, cost of doing business, etc.), penalties (Class C misdemeanor, civil actions, injunctive relief), and void contracts for violations.
• Revenue distribution: Outlines how tobacco tax revenues are distributed to various funds, including the State Public Welfare Trust Fund, general and mental health funds, Medicaid, and the General Fund; includes provisions for county offsets related to local stamp administration costs.
• Effective dates: Certain sections become effective September 1, 2015, with the vapor-product provisions and related sections taking effect July 1, 2016.

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