Chapter 3.75
CIGARETTE TAX
Sections:
3.75.010 Cigarette tax imposed.
3.75.030 Levied – Amount – Tax additional to other taxes.
3.75.050 Preparation and sale of stamps generally – Discounts.
3.75.060 Duties of dealers and sellers.
3.75.070 Monthly reports and recordkeeping.
3.75.080 Assessment of unpaid taxes.
3.75.090 Display of stamps – Seizure.
3.75.100 Refund for unused or damaged stamps.
3.75.110 Rules and regulations.
3.75.120 Violations of chapter generally.
3.75.130 Violations of chapter prohibited – Acts enumerated.
3.75.010 Cigarette tax imposed.
Pursuant to the authority set forth in the Charter for the city of Staunton in Section 11, Paragraph 24, and Sections 58.1-3830 and 58.1-3840 of the Code of Virginia, 1950, as amended, there is hereby imposed a tax on the sale and use of cigarettes to provide revenue for the general fund of the city as set forth hereafter in this chapter. (Ord. 2004-21; Ord. 2004-15. Code 1985, § 12-271).
3.75.020 Definitions.
Except where the context clearly indicates a different meaning, the following words and phrases shall, for purposes of this chapter, have the meanings respectively ascribed to them in this section:
“Cigarette” means any roll of any size or shape for smoking, whether filtered or unfiltered, with or without a mouthpiece, made wholly or partly of cut, shredded or crimped tobacco or other plant or substitute for tobacco, whether the same is flavored, adulterated or mixed with another ingredient, if the wrapper or cover is made of any material other than leaf tobacco or homogenized leaf tobacco, regardless of whether the roll is labeled or sold as a cigarette or by any other name.
“City” means the city of Staunton, Virginia.
“Dealer” means every manufacturer, manufacturer’s representative, self-wholesaler, wholesaler, public warehouser or other person who supplies a seller within the city with cigarettes.
“Director” means the director of finance for the city of Staunton, or his or her designee.
“Package” means any container, regardless of the material used in its construction in which separate cigarettes are placed without such cigarettes being placed into any container within the package. Packages are those containers of cigarettes from which individual cigarettes are ordinarily taken when they are consumed by their ultimate user.
“Person” means any individual, firm, unincorporated association, company, corporation, L.L.C., joint stock company, group, agency, syndicate, trust or trustee, receiver, fiduciary, partnership and conservator. The word “person” as applied to a partnership, unincorporated association or other joint venture means the partners or members thereof, and as applied to a corporation shall include all the officers and directors thereof.
“Sale” means every act or transaction, regardless of the method or means employed, including the use of vending machines and other mechanical devices, whereby title to any cigarettes shall be transferred from the seller to any other person within the corporate limits of the city.
“Seller” means every person who transfers title to any cigarettes, or in whose place of business title to any cigarettes is transferred, within the corporate limits of the city, for any purpose other than resale.
“Stamp” means a small gummed piece of paper or decalcomania to be sold by the city director of finance and to be affixed, manually or by machine, to every package of cigarettes sold at retail in the city, under the authorization of the director of finance.
“Treasurer” means the treasurer for the city of Staunton, or his or her designee. (Ord. 2004-21; Ord. 2004-15. Code 1985, § 12-272).
3.75.030 Levied – Amount – Tax additional to other taxes.
In addition to all other taxes of every kind now or hereafter imposed by law, there is hereby levied and imposed by the city an excise tax on the sale of cigarettes equivalent to $0.30 on each package containing 25 or fewer cigarettes. The tax shall be paid by the seller, if not previously paid, and collected in the manner and at the time provided for in this chapter; provided, that the tax payable for each package of cigarettes sold within the city shall be paid but once. The tax hereby levied shall not apply to free distribution of sample cigarettes in packages containing five or fewer cigarettes. (Ord. 2014-10; Ord. 2004-21; Ord. 2004-15. Code 1985, § 12-273).
3.75.040 Methods of payment.
The tax imposed by this chapter shall be evidenced by the use of a stamp, purchased from the city director of finance and affixed by the dealer or seller to every package of cigarettes to be sold within the city. The tax shall be paid at the time the stamps are purchased from the director of finance. Every dealer and every seller shall have the right to buy such stamps from the director of finance and to affix the same to packages of cigarettes as provided in this chapter. (Ord. 2004-21; Ord. 2004-15. Code 1985, § 12-274).
3.75.050 Preparation and sale of stamps generally – Discounts.
For the purpose of making stamps available for use, the director of finance shall sell stamps of such denomination and in such quantities as may be necessary for the payment of the taxes imposed by this chapter. In the sale of such stamps, the director of finance shall allow a discount of five percent of the denominational or face value of the stamps to cover the costs incurred in affixing the stamps to packages of cigarettes. (Ord. 2004-21; Ord. 2004-15. Code 1985, § 12-275).
3.75.060 Duties of dealers and sellers.
(1) Every dealer in cigarettes is hereby required and it shall be his duty to purchase such stamps at the office of the director of finance as shall be necessary to pay the tax levied and imposed by this chapter, and to affix or cause to be affixed, a stamp or stamps of the prescribed monetary value to each package of cigarettes prior to delivering or furnishing such cigarettes to any seller.
(2) Every seller is hereby required to examine each package of cigarettes, prior to exposing the same for sale, for the purpose of ascertaining whether such package has the proper stamps affixed thereto or imprinted thereon as required by this chapter. If upon such examination unstamped or improperly stamped packages of cigarettes are discovered, the seller shall either:
(a) Purchase and affix to such packages of cigarettes the proper stamps covering the tax imposed by this chapter; or
(b) Immediately notify the dealer who provided the cigarettes, and upon such notification such dealer shall forthwith either affix to the unstamped or improperly stamped packages the proper amount of stamps, or shall replace such packages with others to which stamps have been properly fixed thereon.
(3) In the event any seller elects to purchase and affix stamps before offering cigarettes for sale, the dealer delivering and furnishing such cigarettes shall not be required to purchase and affix stamps to such cigarettes so sold or furnished; provided, that any such dealer shall, on the day following the day of such delivery, file with the director a copy of the delivery memorandum showing the name and address of such seller and the quantity and type of cigarettes so delivered and furnished. (Ord. 2004-21; Ord. 2004-15. Code 1985, § 12-276).
3.75.070 Monthly reports and recordkeeping.
(1) It shall be the duty of each dealer to report monthly to the director separately the following information:
(a) The quantity of stamped cigarettes sold or delivered during the period requested by the director to:
(i) Each dealer;
(ii) Each seller; and
(iii) Each separate person or place of business within the city;
(b) The quantity of stamps on hand, both affixed and unaffixed on the first day of the period of request and the quantity of stamps or stamped cigarettes received during the period; and
(c) Such further information as the director may require for the proper administration and enforcement of this chapter for the determination of the exact number of cigarettes in the possession of each dealer or user.
(2) Upon request by the director, any seller shall provide the director, in writing, with the name and address of the dealer who provides the seller with cigarettes.
(3) It shall be the duty of every dealer and seller in the city to maintain and keep, for a period of two years, complete records of the number of packages of cigarettes delivered or sold by such dealer or seller and to make all such records available for examination by the director, upon demand, at any and all reasonable times. (Ord. 2004-21; Ord. 2004-15. Code 1985, § 12-277).
3.75.080 Assessment of unpaid taxes.
(1) When, upon examination and audit of any invoices, records, books, canceled checks or other memoranda touching on the purchase, sale, receipt, storage or possession of tobacco products taxed herein, any dealer or other person liable for the tax is unable to furnish evidence to the director of sufficient tax payments and stamp purchases to cover cigarettes which were sold, used, stored, received, purchased or possessed by him, the prima facie presumption shall arise that such cigarettes were received, sold, used, stored, purchased or possessed by him without the proper tax having been paid. The director shall, from the results of such examination and audit based upon such direct or indirect information available, assess the tax due and unpaid.
(2) The dealer or other person liable for the tax shall be notified by certified mail or hand delivery of such deficiency and such tax, penalty and interest assessed shall be due and payable within 10 days after notice of such deficiency has been issued. (Ord. 2004-21; Ord. 2004-15. Code 1985, § 12-278).
3.75.090 Display of stamps – Seizure.
(1) Stamps shall be placed upon each package of cigarettes in such manner as to be readily visible to the purchaser, and shall be affixed to each package of cigarettes in such a manner that their removal will require continued application of water or steam.
(2) Any seller found to possess, prior to being offered for sale, more than 60 packages of cigarettes without the tax paid stamp affixed who is not in the process of affixing such stamps thereto, shall be presumed to be in possession of untaxed cigarettes in violation of this chapter. If such person has received the cigarettes within the preceding 48 hours, and has not offered them for sale, such presumption shall not apply.
(3) Any vending machine located within the city containing cigarettes upon which the stamp has not been affixed or containing cigarettes placed so as to not allow visual inspection of the stamp through the viewing area as provided for by the vending machine manufacturer shall be presumed to contain untaxed cigarettes in violation of this chapter. If a vending machine does not allow for visual inspection of the stamp, the director is hereby authorized to direct the owner to open the machine in order to determine whether the cigarettes contained therein are stamped.
(4) Any cigarettes, coin operated vending machines, counterfeit stamps, or other property found in violation of this chapter shall be declared contraband goods and may be seized by the director. In addition to any tax due, the dealer or other person liable for the tax possessing such untaxed cigarettes shall be subject to civil and criminal penalties herein provided.
(5) In lieu of seizure, the director may seal such vending machines to prevent continued illegal sale or removal of such cigarettes. The removal of such seal from a vending machine by any unauthorized person shall be a violation of this chapter. Nothing in this chapter shall prevent the seizure of any vending machine at any time after it is sealed.
(6) All cigarette vending machines shall be plainly marked with the name, address and telephone number of the owner of said machine.
(7) Any seized and confiscated cigarettes, vending machines or other property used in the furtherance of any illegal evasion of the tax may be disposed of by sale or other method deemed appropriate by the director 30 days after notice to the person from whom the items were seized, and any other known holder of a property interest in the property. The notice shall state that the owner or holder of a property interest may challenge the proposed sale and forfeiture by written appeal to the Staunton city manager at least five days prior to the date of the proposed sale. The appellant shall have the right to personally appear before the city manager, or his or her designee, and to present any relevant evidence or witnesses, to question any witness for the city, and to assert any available affirmative defense. The city manager shall render a written decision on the appeal within 10 working days. If a timely appeal is filed, no sale and forfeiture shall occur unless and until the city manager renders a decision rejecting the appeal.
(8) No credit from any sale of cigarettes, vending machines or other property seized shall be allowed toward any tax, penalties or interest assessed.
(9) An inventory of the property seized pursuant to a violation of this section shall be prepared and a copy shall be provided to the owner of the seized property as soon as practicable.
(10) When any property is seized for the purposes of forfeiture and an information naming that property has not been filed, neither the agency seizing the property nor any other law enforcement agency may request, require, or in any manner induce any person who asserts ownership, lawful possession, or any lawful right to the property to waive his interest in or rights to the property until an information has been filed. (Ord. 2018-18; Ord. 2004-21; Ord. 2004-15. Code 1985, § 12-279).
3.75.100 Refund for unused or damaged stamps.
(1) Should any person, after acquiring from the director of finance any stamps provided for in this chapter, cease to be engaged in a business necessitating the use of the stamps, or should the stamps be damaged to the extent that they are unusable, such person shall be entitled to a refund of the denominational or face amount of any such stamps, less any discount, upon presenting the stamps to the director of finance and furnishing the director of finance with an affidavit showing, to his satisfaction, that the stamps were acquired by such person but not used, and the reason for requesting the refund.
(2) Any and all refunds for unused or damaged stamps provided for under this section may be made on vouchers approved by the director of finance. Such refunds shall be charged against the sums collected for the sale of said stamps. Payment to the person requesting the refund shall be made within 30 days of the request. (Ord. 2004-21; Ord. 2004-15. Code 1985, § 12-280).
3.75.110 Rules and regulations.
The director is hereby authorized and empowered to jointly prescribe, adopt, promulgate and enforce rules and regulations relating to the methods and means of cancellation of the stamps provided for in this chapter and to any and all other matters pertaining to the administration and enforcement of the provisions of this chapter. The director is further authorized and empowered to examine the books, records, invoices, papers and any and all cigarettes in and upon any premises where the same are placed, stored, sold, offered for sale, or displayed for sale by a seller. The director is authorized to delegate any of the powers and duties set out in this chapter to one or more deputies or assistants, except as may be prohibited by law. (Ord. 2004-21; Ord. 2004-15. Code 1985, § 12-281).
3.75.120 Violations of chapter generally.
(1) Any person violating any of the provisions of this chapter shall be guilty of a Class 1 misdemeanor. Conviction and punishment for such violation shall not relieve any person from the payment of any tax, interest or penalty imposed by this chapter.
(2) Any person who fails to pay any cigarette tax at the time it is due shall pay a late payment penalty in the amount of 10 percent of the unpaid tax per month.
(3) Any person who fails to pay any cigarette tax at the time it is due shall pay interest on the tax found to be overdue and unpaid at the rate of three quarters of one percent per month.
(4) In addition, any person who shall perform any fraudulent act or fail to perform any act for the purpose of evading the payment of any tax imposed by this chapter shall be required to pay a penalty in the amount of 50 percent of any tax found to be overdue and unpaid.
(5) Each day’s violation of, or noncompliance with, any of the provisions of this chapter shall be and constitute a separate offense. (Ord. 2004-21; Ord. 2004-15. Code 1985, § 12-282).
3.75.130 Violations of chapter prohibited – Acts enumerated.
It shall be unlawful and a violation of this chapter for any person:
(1) To perform any act or fail to perform any act for the purpose of evading the payment of any tax imposed by this chapter or of any part thereof, or for any dealer or seller, with intent to violate any provision of this chapter, to fail or refuse to perform any of the duties imposed upon him under the provisions of this chapter, or to fail or refuse to obey any lawful order which the director may issue under this chapter;
(2) To falsely or fraudulently make, forge, alter or counterfeit any stamp, invoice or reports, to procure or cause to be made, forged, altered or counterfeited any such stamp, or knowingly and willfully to alter, publish, pass or tender as true any false, altered, forged or counterfeited stamp or stamps;
(3) To sell any cigarettes upon which the tax imposed by this chapter has not been paid and upon which evidence of payment thereof is not shown on each package of cigarettes;
(4) To reuse or refill with cigarettes any package from which the cigarettes have been removed, for which the tax has been paid;
(5) To remove from any package any stamp with intent to use or cause the same to be used after the same have already been used, or to buy, sell or offer for sale or give away any used, removed, altered or restored stamps, to any person, or to reuse any stamp which has theretofore been used for evidence of the payment of any tax prescribed in this chapter, or, except as to the director of finance, to sell or offer to sell any stamp provided for herein;
(6) To possess, store, use, authorize or approve the possession, storage or use for sale or resale of any cigarettes in quantities of more than 60 packages upon which the stamp has not been affixed; or
(7) To transport, authorize or approve the transportation of any cigarettes, in quantities of more than 60 packages into or within the city upon which the stamp has not been affixed, if they are:
(a) Not accompanied by a bill of lading or other document indicating the true name and address of the consignor or seller and the consignee or purchaser and the brands and quantity of cigarettes transported; or
(b) Accompanied by a bill of lading or other document which is false or fraudulent in whole or part; or
(c) Accompanied by a bill of lading or other document indicating:
(i) A consignee or purchaser in another state or the District of Columbia who is not authorized by the law of such other jurisdiction to receive or possess such cigarettes on which the taxes imposed by such other jurisdiction have not been paid, unless the tax of the state or district of destination has been paid and the said cigarettes bear the tax stamps of that state or district; or
(ii) A consignee or purchaser in the Commonwealth of Virginia but outside the city who does not possess a Virginia Sales and Use Tax Certificate, a Virginia Retail Tobacco License and, where applicable, both a business license and a retail tobacco license issued by the local jurisdiction of destination. (Ord. 2004-21; Ord. 2004-15. Code 1985, § 12-283).