HB3 Alabama 2015 2nd Special Session

Summary

Primary Sponsor

Connie C. Rowe

Republican

Session

Second Special Session 2015

Title

Cigarettes, tax increased, discount on tobacco tax stamps lowered, Indian tribal refunds, further provided for, tax on vapor products, distrib. for Medicaid, Sec. 40-25-2.2 added; Secs. 40-23-1, 40-23-35, 40-25-2, 40-25-5 am'd.

Summary

HB3 raises Alabama’s cigarette tax, lowers the tobacco tax stamp discount, updates how tobacco taxes are collected, and directs the extra revenue to the General Fund starting Oct. 1, 2015.

What This Bill Does

It increases the per-pack cigarette tax from 0.425 to 0.675 dollars and changes how the money is distributed. It reduces the tobacco tax stamp discount wholesalers receive from 7.5% to 4.75%. It revises the tobacco tax structure and stamp program, including license taxes, stamp denominations, collection methods, and enforcement. It directs all revenue from the increased tax to the State General Fund and sets an effective date of October 1, 2015.

Who It Affects

• Cigarette purchasers/consumers who will pay higher prices due to the increased per-pack tax.
• Wholesalers, distributors, jobbers, and retailers who collect tobacco taxes and manage stamps for sales in Alabama.
• The Alabama Department of Revenue, which administers the stamp program and tax collection.
• Local governments, which may not impose new cigarette or tobacco taxes but may rely on existing pre-2004 local taxes as permitted.

Key Provisions

• Cigarette tax increased from 0.425 to 0.675 dollars per pack and distributed as provided in the act.
• Tobacco tax stamp discount reduced from 7.5% to 4.75% on stamp purchases.
• Tax administration updated through amendments to Sections 40-25-2 and 40-25-5, including stamp issuance, denominations, and collection rules.
• Stamps required on tobacco products, with specific rules for affixing stamps and handling non-stamped or unlawfully stamped goods.
• Wholesalers or jobbers may purchase stamps on consignment with a bond and must remit monthly by the 20th for stamps used (with interest for late remittance).
• All revenue from the increased tax goes to the State General Fund.
• Effective date: October 1, 2015.
• Local cigarette/tobacco taxes are restricted to pre-2004 arrangements; no new local taxes may be levied.

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