HB139 Alabama 2015 Session

Summary

Primary Sponsor

Steve McMillan

Republican

Session

Regular Session 2015

Title

Tobacco products, tax increase, discount adjusted on tobacco stamp purchases, distrib., Secs. 40-25-2, 40-25-2.1, 40-25-5, 40-25-23 am'd.

Summary

HB139 would raise Alabama’s tobacco taxes, adjust the tobacco stamp discount, and change how the new revenue is distributed.

What This Bill Does

It increases the state tax on cigarettes and other tobacco products and updates the tobacco stamping system used to collect the tax. It sets a new wholesalers’ stamp discount of 2.7% and adds rules for stamps, including possible consignment with a bond and monthly remittance. It specifies how the new revenue would be distributed to the General Fund and various state programs (public welfare, health and mental health, parks) and sets aside funds to support Medicaid and local county administration of local cigarette taxes. It also requires tobacco sellers to obtain a license, collect the tax, file monthly reports, and follow enforcement provisions.

Who It Affects

• Consumers who buy cigarettes and other tobacco products: taxes will be higher, which could raise retail prices.
• Retailers, wholesalers, and jobbers who sell tobacco products: they must obtain licenses, collect the tax, use stamps, file monthly tax returns, and comply with enforcement rules; they may also be affected by the stamp discount and consignment provisions.

Key Provisions

• Tax rate increases on cigarettes and other tobacco products, including a separate tax framework for cigar wrappers, as amended in Sections 40-25-2, 40-25-2.1, 40-25-5, and 40-25-23.
• Stamp discount adjustments: wholesalers and jobbers receive a 2.7% discount on stamp purchases; stamps may be sold on consignment with a bond and require monthly remittance and accounting; penalties apply for noncompliance.
• Revenue distribution: cigarette tax proceeds are allocated among the General Fund and multiple state programs (Public Welfare Trust Fund, health and mental health funds, debt service, parks, and other designated uses), with additional allocations to counties for local stamp administration (up to $2 million annually) and to Medicaid; tobacco products other than cigarettes go to the General Fund.
• Licensing and compliance: creation or renewal of licenses to sell taxed tobacco products; monthly reporting requirements and penalties for failure to report or maintain records; enforcement provisions and effective date of July 1, 2015.

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

Subjects

Tobacco