CHAPTER 155. CIGARS AND TOBACCO PRODUCTS TAX
TAX CODE
TITLE 2. STATE TAXATION
SUBTITLE E. SALES, EXCISE, AND USE TAXES
CHAPTER 155. CIGARS AND TOBACCO PRODUCTS TAX
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 155.001. DEFINITIONS. In this chapter:
(1) "Bonded agent" means a person in this state who is an agent
of a person outside this state and receives cigars and tobacco
products in interstate commerce and stores the cigars and tobacco
products for distribution or delivery to distributors under
orders from the person outside this state.
(2) "Cigar" means a roll of fermented tobacco that is wrapped in
tobacco and the main stream of smoke from which produces an
alkaline reaction to litmus paper.
(3) "Commercial business location" means the entire premises
occupied by a permit applicant or a person required to hold a
permit under this chapter.
(4) "Common carrier" means a motor carrier registered under
Chapter 643, Transportation Code, or a motor carrier operating
under a certificate issued by the Interstate Commerce Commission
or a successor agency to the Interstate Commerce Commission.
(5) "Consumer" means a person who possesses tobacco products for
personal consumption.
(6) "Distributor" means a person who:
(A) receives tobacco products for the purpose of making a first
sale in this state from a manufacturer outside the state or
within the state or otherwise brings or causes to be brought into
this state tobacco products for sale, use, or consumption;
(B) manufactures or produces tobacco products; or
(C) is an importer or import broker.
(7) "Export warehouse" means a person in this state who receives
tobacco products from manufacturers and stores the tobacco
products for the purpose of making sales to authorized persons
for resale, use, or consumption outside the United States.
(8) "First sale" means, except as otherwise provided by this
chapter:
(A) the first transfer of possession in connection with a
purchase, sale, or any exchange for value of tobacco products in
intrastate commerce;
(B) the first use or consumption of tobacco products in this
state; or
(C) the loss of tobacco products in this state whether through
negligence, theft, or other unaccountable loss.
(9) "Importer" or "import broker" means a person who ships,
transports, or imports into this state tobacco products
manufactured or produced outside the United States for the
purpose of making a first sale in this state.
(10) "Manufacturer" means a person who manufactures or produces
tobacco products and sells tobacco products to a distributor.
(11) "Manufacturer's representative" means a person employed by
a manufacturer to sell or distribute the manufacturer's tobacco
products.
(12) "Permit holder" means a bonded agent, distributor,
wholesaler, manufacturer, importer, or retailer required to
obtain a permit under Section 155.041.
(13) "Place of business" means:
(A) a commercial business location where tobacco products are
sold;
(B) a commercial business location where tobacco products are
kept for sale or consumption or otherwise stored; or
(C) a vehicle from which tobacco products are sold.
(14) "Retailer" means a person who engages in the practice of
selling tobacco products to consumers and includes the owner of a
coin-operated vending machine.
(15) "Tobacco product" means:
(A) a cigar;
(B) smoking tobacco, including granulated, plug-cut, crimp-cut,
ready-rubbed, and any form of tobacco suitable for smoking in a
pipe or as a cigarette;
(C) chewing tobacco, including Cavendish, Twist, plug, scrap,
and any kind of tobacco suitable for chewing;
(D) snuff or other preparations of pulverized tobacco; or
(E) an article or product that is made of tobacco or a tobacco
substitute and that is not a cigarette.
(16) "Wholesaler" means a person, including a manufacturer's
representative, who sells or distributes tobacco products in this
state for resale but who is not a distributor.
Acts 1981, 67th Leg., p. 1666, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1984, 68th Leg., 2nd C.S., ch. 31, art. 2,
Sec. 7, eff. Oct. 2, 1984; Acts 1985, 69th Leg., ch. 58, Sec. 21,
eff. March 1, 1986; Acts 1991, 72nd Leg., ch. 409, Sec. 45, eff.
June 7, 1991; Acts 1995, 74th Leg., ch. 705, Sec. 11, eff. Sept.
1, 1995; Acts 1997, 75th Leg., ch. 165, Sec. 30.263, eff. Sept.
1, 1997; Acts 1997, 75th Leg., ch. 1040, Sec. 46, eff. Sept. 1,
1997; Acts 2001, 77th Leg., ch. 540, Sec. 4, eff. Sept. 1, 2001;
Acts 2001, 77th Leg., ch. 1263, Sec. 51, eff. Oct. 1, 2001.
Sec. 155.002. STORAGE. (a) The commercial business location
where tobacco products are stored or kept cannot be a residence
or a unit in a public storage facility.
(b) This section does not apply to a manufacturer's
representative.
Added by Acts 2001, 77th Leg., ch. 540, Sec. 5, eff. Sept. 1,
2001. Amended by Acts 2003, 78th Leg., ch. 209, Sec. 27, eff.
Oct. 1, 2003.
SUBCHAPTER B. IMPOSITION AND RATE OF TAX
Sec. 155.021. TAX IMPOSED ON CIGARS. (a) A tax is imposed and
becomes due and payable when a permit holder receives cigars for
the purpose of making a first sale in this state.
(b) The tax rates are:
(1) one cent per 10 or fraction of 10 on cigars weighing three
pounds or less per thousand;
(2) $7.50 per thousand on cigars that:
(A) weigh more than three pounds per thousand; and
(B) sell at factory list price, exclusive of any trade discount,
special discount, or deal, for 3.3 cents or less each;
(3) $11 per thousand on cigars that:
(A) weigh more than three pounds per thousand;
(B) sell at factory list price, exclusive of any trade discount,
special discount, or deal, for more than 3.3 cents each; and
(C) contain no substantial amount of nontobacco ingredients; and
(4) $15 per thousand on cigars that:
(A) weigh more than three pounds per thousand;
(B) sell at factory list price, exclusive of any trade discount,
special discount, or deal, for more than 3.3 cents each; and
(C) contain a substantial amount of nontobacco ingredients.
(c) Cigars taxed under Subsections (b)(3) and (b)(4) of this
section are presumed to contain a substantial amount of
nontobacco ingredients unless the report on the cigars required
by Section 155.111 of this code is accompanied by an affidavit
stating that specific cigars described in the report do not
contain sheet wrapper, sheet binder, or sheet filler. If the
manufacturer prepares the report, the manufacturer shall make the
affidavit. If the distributor prepares the report, the
manufacturer and the distributor shall make the affidavit.
Acts 1981, 67th Leg., p. 1667, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1984, 68th Leg., 2nd C.S., ch. 31, art. 2,
Sec. 5, eff. Oct. 2, 1984; Acts 1991, 72nd Leg., ch. 409, Sec.
46, eff. June 7, 1991.
Sec. 155.0211. TAX IMPOSED ON TOBACCO PRODUCTS OTHER THAN
CIGARS. (a) A tax is imposed and becomes due and payable when a
permit holder receives tobacco products other than cigars, for
the purpose of making a first sale in this state.
(b) Except as provided by Subsection (c), the tax rate for each
can or package of a tobacco product other than cigars is $1.22
per ounce and a proportionate rate on all fractional parts of an
ounce.
(b-1) Notwithstanding Subsection (b) and except as provided by
Subsection (c), for the state fiscal year beginning September 1,
2012, the tax rate for each can or package of a tobacco product
other than cigars is $1.19 per ounce and a proportionate rate on
all fractional parts of an ounce. This subsection expires
December 1, 2013.
(b-2) Notwithstanding Subsection (b) and except as provided by
Subsection (c), for the state fiscal year beginning September 1,
2011, the tax rate for each can or package of a tobacco product
other than cigars is $1.16 per ounce and a proportionate rate on
all fractional parts of an ounce. This subsection expires
December 1, 2012.
(b-3) Notwithstanding Subsection (b) and except as provided by
Subsection (c), for the state fiscal year beginning September 1,
2010, the tax rate for each can or package of a tobacco product
other than cigars is $1.13 per ounce and a proportionate rate on
all fractional parts of an ounce. This subsection expires
December 1, 2011.
(b-4) Notwithstanding Subsection (b) and except as provided by
Subsection (c), for the state fiscal year beginning September 1,
2009, the tax rate for each can or package of a tobacco product
other than cigars is $1.10 per ounce and a proportionate rate on
all fractional parts of an ounce. This subsection expires
December 1, 2010.
(c) The tax imposed on a can or package of a tobacco product
other than cigars that weighs less than 1.2 ounces is equal to
the amount of the tax imposed on a can or package of a tobacco
product that weighs 1.2 ounces.
(d) The computation of the tax under this section and the
applicability of Subsection (c) shall be based on the net weight
as listed by the manufacturer. The total tax to be imposed on a
unit that contains multiple individual cans or packages is the
sum of the taxes imposed by this section on each individual can
or package intended for sale or distribution at retail.
(e) A change in the tax rate in effect for a state fiscal year
that occurs in accordance with this section does not affect taxes
imposed before that fiscal year, and the rate in effect when
those taxes were imposed continues in effect for purposes of the
liability for and collection of those taxes.
Added by Acts 1984, 68th Leg., 2nd C.S., ch. 31, art. 2, Sec. 6,
eff. Oct. 2, 1984. Amended by Acts 1987, 70th Leg., 2nd C.S., ch.
5, art. 4, Sec. 2; Acts 1990, 71st Leg., 6th C.S., ch. 5, Sec.
2.02, eff. July 1, 1990; Acts 1991, 72nd Leg., ch. 409, Sec. 47,
eff. June 7, 1991.
Amended by:
Acts 2006, 79th Leg., 3rd C.S., Ch.
7, Sec. 2, eff. January 1, 2007.
Acts 2009, 81st Leg., R.S., Ch.
285, Sec. 10, eff. September 1, 2009.
Sec. 155.022. FIRST SALE OF TOBACCO PRODUCTS. A person who
receives or possesses tobacco products on which a tax of more
than $50 would be due if the receipt or possession were for the
purpose of making a first sale in this state is presumed to
receive or possess the tobacco products for the purpose of making
a first sale in this state. This presumption does not apply to
common carriers or to manufacturers. A tax is imposed on
manufacturers who manufacture tobacco products in this state at
the time the tobacco products are first transferred in connection
with a purchase, sale, or any exchange for value in intrastate
commerce. The distribution or delivery of tobacco products by a
bonded agent to a permitted distributor in this state, under
instructions received from outside this state, is not a first
sale.
Acts 1981, 67th Leg., p. 1668, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1991, 72nd Leg., ch. 409, Sec. 47, eff.
June 7, 1991.
Sec. 155.023. PAYMENT OF TAX. (a) A distributor shall pay the
tax on tobacco products received for the purpose of making a
first sale at the time the distributor files the report required
by Section 155.111. A distributor shall pay the tax by cashier's
check payable to the comptroller, by electronic funds transfer to
the comptroller or by any other method of payment authorized by
the comptroller.
(b) The person in possession of tobacco products has the burden
to prove payment of the tax on the products.
Acts 1981, 67th Leg., p. 1668, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1991, 72nd Leg., ch. 409, Sec. 47, eff.
June 7, 1991; Acts 1997, 75th Leg., ch. 1423, Sec. 19.77, eff.
Sept. 1, 1997.
Sec. 155.024. EXCEPTION FOR PERSONAL USE. A person who
personally transports cigars or tobacco products in quantities or
amounts that would ordinarily retail at 25 cents or less is not
required to pay the tax imposed by this chapter if the person
uses the cigars or tobacco products and does not sell them or
offer them for sale.
Acts 1981, 67th Leg., p. 1662, ch. 389, Sec. 1, eff. Jan. 1,
1982.
Sec. 155.026. PENALTY FOR FAILURE TO PAY TAX. (a) A
distributor who fails to timely pay the tax when due shall pay
five percent of the amount of tax then due as a penalty, and if
the distributor fails to pay the tax on or before the 30th day
after the day on which the tax is due, the distributor shall pay
an additional five percent.
(b) The minimum penalty imposed by this section is $50.
(c) The dishonor of a check delivered to the treasury for
payment of taxes constitutes a failure to pay the tax when due.
Acts 1981, 67th Leg., p. 1669, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1983, 68th Leg., p. 451, ch. 93, Sec. 3,
eff. Sept. 1, 1983; Acts 1991, 72nd Leg., ch. 409, Sec. 47, eff.
June 7, 1991.
Sec. 155.027. VENUE. Venue of a suit for collection of a
penalty for late payment of taxes is in Travis County.
Acts 1981, 67th Leg., p. 1669, ch. 389, Sec. 1, eff. Jan. 1,
1982.
SUBCHAPTER C. PERMITS
Sec. 155.041. PERMITS. (a) A person may not engage in business
as a distributor, wholesaler, bonded agent, manufacturer,
importer, or retailer unless the person has applied for and
received the applicable permit from the comptroller.
(b) Each distributor, wholesaler, bonded agent, manufacturer,
importer, or retailer shall obtain a permit for each place of
business owned or operated by the distributor, wholesaler, bonded
agent, manufacturer, importer, or retailer.
(c) The comptroller shall prescribe the form and content of an
application for a permit and shall furnish the form on request of
an applicant.
(d) The applicant shall accurately complete all information
required by the application and provide the comptroller with
additional information the comptroller considers necessary.
(e) The comptroller may require each corporation, association,
joint venture, syndicate, partnership, or proprietorship to
furnish financial information regarding the applicant and to
provide the identity of each officer, director, stockholder
owning 10 percent or more of the outstanding stock, partner,
member, owner, or managing employee.
(f) Each distributor, wholesaler, and retailer that applies for
a permit to sell tobacco products from a vehicle must provide the
make, model, vehicle identification number, registration number,
and any other information required by the comptroller.
(g) All financial information provided under this section is
confidential and not subject to Chapter 552, Government Code.
(h) Permits for engaging in business as a distributor,
wholesaler, bonded agent, manufacturer, importer, or retailer
shall be governed exclusively by the provisions of this code.
Acts 1981, 67th Leg., p. 1669, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1985, 69th Leg., ch. 58, Sec. 23, eff.
March 1, 1986; Acts 1989, 71st Leg., ch. 240, Sec. 54, eff. Oct.
1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 48, eff. June 7,
1991; Acts 1995, 74th Leg., ch. 76, Sec. 5.95(88), eff. Sept. 1,
1995; Acts 1995, 74th Leg., ch. 1000, Sec. 47, eff. Oct. 1, 1995;
Acts 1997, 75th Leg., ch. 1423, Sec. 19.78, eff. Sept. 1, 1997;
Acts 2001, 77th Leg., ch. 1263, Sec. 52, eff. Oct. 1, 2001.
Sec. 155.0415. SALES: PERMIT HOLDERS AND NONPERMIT HOLDERS. (a)
Except for retail sales to consumers, tobacco products may only
be sold or distributed by and between permit holders.
(b) A person who is not a permit holder may not sell or
distribute tobacco products on which a tax of more than $50 has
been paid or is due.
Added by Acts 1991, 72nd Leg., ch. 409, Sec. 49, eff. June 7,
1991.
Sec. 155.045. COMBINATION PERMIT. The comptroller may issue a
combination permit for cigarettes and tobacco products under
Section 154.102. A person who receives a combination permit is
subject to the provisions of this chapter in the same manner as a
person holding a single permit under this chapter.
Acts 1981, 67th Leg., p. 1670, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1985, 69th Leg., ch. 58, Sec. 24, eff.
March 1, 1986; Acts 1989, 71st Leg., ch. 240, Sec. 58, eff. Oct.
1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 50, eff. June 7,
1991; Acts 1997, 75th Leg., ch. 1423, Sec. 19.79, eff. Sept. 1,
1997.
Sec. 155.048. ISSUANCE OF PERMITS. (a) The comptroller shall
issue a permit to a distributor, wholesaler, bonded agent,
manufacturer, importer, or retailer if the comptroller:
(1) has received an application and fee, if required;
(2) does not reject the application and deny the permit under
Section 155.0481; and
(3) determines that issuing the permit will not jeopardize the
administration and enforcement of this chapter.
(b) The permit shall be issued for a designated place of
business, except as provided by Section 155.053.
(c) The permits are nonassignable.
(d) The permit must indicate the type of permit that it is and
authorize the sale of tobacco products in this state. The permit
must show that it is revocable and shall be forfeited or
suspended if the conditions of issuance, provisions of this
chapter, or rules of the comptroller are violated.
Acts 1981, 67th Leg., p. 1670, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1985, 69th Leg., ch. 58, Sec. 26, eff.
March 1, 1986; Acts 1989, 71st Leg., ch. 240, Sec. 61, eff. Oct.
1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 50, eff. June 7,
1991; Acts 1997, 75th Leg., ch. 1423, Sec. 19.80, eff. Sept. 1,
1997; Acts 2001, 77th Leg., ch. 1263, Sec. 53, eff. Oct. 1, 2001.
Sec. 155.0481. DENIAL OF PERMIT. The comptroller may reject an
application and deny a permit if the comptroller finds, after
notice and opportunity for hearing, any of the following:
(1) the premises where business will be conducted are not
adequate to protect the tobacco products; or
(2) the applicant or managing employee, or, if the applicant is
a corporation, an officer, director, manager, or any stockholder
who holds directly or through family or partner relationship 10
percent or more of the corporation's stock, or, if the applicant
is a partnership, a partner or manager:
(A) has failed to disclose any information required by Sections
155.041(d), (e), and (f), including prior business experience,
financial condition of the permit holder, present or previous
business affiliations, prior employment, and any conviction of a
felony, or has made a false statement in the application; or
(B) has previously violated provisions of this chapter.
Added by Acts 1991, 72nd Leg., ch. 409, Sec. 50, eff. June 7,
1991. Amended by Acts 1997, 75th Leg., ch. 1423, Sec. 19.81, eff.
Sept. 1, 1997.
Sec. 155.049. LICENSING YEAR; FEES. (a) A permit required by
this chapter expires on the last day of February of each year,
except the retailer's permit required by Section 155.041 expires
on the last day of May of each even-numbered year.
(b) An application for a permit required by this chapter must be
accompanied by a fee of:
(1) $300 for a bonded agent's permit;
(2) $300 for a distributor's permit;
(3) $200 for a wholesaler's permit;
(4) $15 for each permit for a vehicle if the applicant is also
applying for a permit as a bonded agent, distributor, or
wholesaler or has received a current permit from the comptroller
under Sections 155.041 and 155.048; and
(5) $180 for a retailer's permit.
(c) Repealed by Acts 1997, 75th Leg., ch. 671, Sec. 4.06(b),
eff. Sept. 1, 1997.
(d) For a new or renewal permit required by Section 155.041, the
comptroller shall prorate the fee according to the number of
months remaining during the calendar year that the permit is to
be in effect.
(e) A person who does not obtain a permit each year in a timely
manner must pay a late fee of $50 in addition to the application
fee for the permit.
(f) If at the date of issuance a permit will expire within three
months, the comptroller may collect the prorated permit fee or
the fee for a current year and, with the consent of the permit
holder, may collect the fee for the next permit year and issue a
permit or permits for both periods, as applicable.
(g) Expired.
Acts 1981, 67th Leg., p. 1670, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1985, 69th Leg., ch. 58, Sec. 27, eff.
March 1, 1986; Acts 1989, 71st Leg., ch. 240, Sec. 62, eff. Oct.
1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 50, eff. June 7,
1991; Acts 1997, 75th Leg., ch. 671, Sec. 4.06, eff. Sept. 1,
1997; Acts 1997, 75th Leg., ch. 1423, Sec. 19.82, eff. Sept. 1,
1997.
Sec. 155.050. PAYMENT FOR PERMITS. (a) An applicant for a
permit required by Section 155.041 shall send the required fee
with the application.
(b) The payment must be in cash or by money order or check.
(c) A permit may not be issued in exchange for a check until
after the comptroller has received full payment on the check.
Acts 1981, 67th Leg., p. 1671, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1989, 71st Leg., ch. 240, Sec. 63, eff.
Oct. 1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 50, eff. June
7, 1991; Acts 1997, 75th Leg., ch. 1423, Sec. 19.83, eff. Sept.
1, 1997.
Sec. 155.053. DISPLAY OF PERMIT. (a) Each permit holder shall
keep the permit on public display at the place of business for
which the permit was issued.
(b) Each permit holder who has a permit assigned to a vehicle
shall post the permit in a conspicuous place on the vehicle.
(c) Each retailer who operates a vending machine that includes
tobacco products shall place a retailer's permit on the machine.
Acts 1981, 67th Leg., p. 1671, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1985, 69th Leg., ch. 58, Sec. 29, eff.
March 1, 1986; Acts 1991, 72nd Leg., ch. 409, Sec. 50, eff. June
7, 1991.
Sec. 155.058. REVENUE. (a) Except as provided by Subsection
(b), revenue from the sale of permits to distributors,
wholesalers, and bonded agents is allocated in the same manner
that other revenue is allocated by Subchapter H.
(b) Revenue from the sale of retailer's permits shall be
deposited to the general revenue fund and may be appropriated
only as provided by this section. The money may be appropriated
first to the comptroller for administration of licensing of
retailers under this chapter or Chapter 154.
(c) If, after any appropriation is made under Subsection (b),
revenue remains from the sale of retailer's permits, the
remaining money may be appropriated to the comptroller for
administration and enforcement of Subchapters H, K, and N,
Chapter 161, Health and Safety Code, and to the Texas Department
of Health, for the administration and enforcement of Section
161.253, Health and Safety Code.
(d) If, after any appropriation is made under Subsections (b)
and (c), revenue remains from the sale of retailer's permits, the
remaining money may be appropriated to the Texas Department of
Health to administer the commissioner of public health's
responsibilities under Section 161.301, Health and Safety Code.
(e) If, after any appropriation is made under Subsections (b),
(c), and (d), revenue remains from the sale of retailer's
permits, the remaining money may be appropriated to the
appropriate entity to administer that entity's responsibilities
under Section 161.302, Health and Safety Code.
Acts 1981, 67th Leg., p. 1672, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1985, 69th Leg., ch. 58, Sec. 33, eff.
March 1, 1986; Acts 1991, 72nd Leg., ch. 409, Sec. 50, eff. June
7, 1991; Acts 1997, 75th Leg., ch. 671, Sec. 4.07, eff. Sept. 1,
1997.
Sec. 155.059. FINAL SUSPENSION OR REVOCATION OF PERMIT. (a)
The comptroller may revoke or suspend a person's permit if the
comptroller finds, after notice and hearing as provided by this
section, that the permit holder violated this chapter or an
administrative rule made under this chapter.
(b) If the comptroller intends to suspend or revoke a permit,
the comptroller shall provide the permit holder with written
notice that includes a statement:
(1) of the reason for the intended revocation or suspension;
(2) that the permit holder is entitled to a hearing by the
comptroller on the proposed suspension or revocation; and
(3) of the date, time, and place of the hearing.
(c) The comptroller shall deliver the written notice by personal
service or by mail to the permit holder's mailing address as it
appears in the comptroller's records. Service by mail is complete
when the notice is deposited with the United States Postal
Service.
(d) The comptroller shall give the permit holder not less than
10 days' notice of a final hearing.
(e) A permit holder may appeal the decision of the comptroller
to a district court in Travis County not later than the 30th day
after the date the comptroller's decision becomes final.
(f) A person whose permit is suspended or revoked may not sell,
offer for sale, or distribute tobacco products from the place of
business to which the permit applied until a new permit is
granted or the suspension is removed.
(g) If the comptroller suspends or revokes a permit, the
comptroller shall provide written notice of the suspension or
revocation, within a reasonable time, to each permit holder in
the state. A permit holder violates Section 155.0415(a) by
selling or distributing tobacco products to a person whose permit
has been suspended or revoked only after the permit holder
receives written notice of the suspension or revocation from the
comptroller.
Acts 1981, 67th Leg., p. 1672, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1985, 69th Leg., ch. 58, Sec. 34, eff.
March 1, 1986; Acts 1989, 71st Leg., ch. 240, Sec. 67, eff. Oct.
1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 50, eff. June 7,
1991; Acts 1995, 74th Leg., ch. 1000, Sec. 48, eff. Oct. 1, 1995;
Acts 1997, 75th Leg., ch. 1423, Sec. 19.84, eff. Sept. 1, 1997;
Acts 1999, 76th Leg., ch. 1467, Sec. 2.43, eff. Oct. 1, 1999.
Sec. 155.0591. SUMMARY SUSPENSION OF A PERMIT. (a) The
comptroller may suspend a person's permit without notice or a
hearing for the person's failure to comply with this chapter or a
rule adopted under this chapter if the person's continued
operation constitutes an immediate and substantial threat to the
collection of taxes imposed by this chapter and attributable to
the person's operation.
(b) If the comptroller summarily suspends a person's permit,
proceedings for a preliminary hearing before the comptroller or
the comptroller's representative must be initiated simultaneously
with the summary suspension. The preliminary hearing shall be set
for a date not later than 10 days after the date of the summary
suspension, unless the parties agree to a later date.
(c) At the preliminary hearing, the permit holder must show
cause why the permit should not remain suspended pending a final
hearing on suspension or revocation.
(d) Chapter 2001, Government Code, does not apply to a summary
suspension under this section.
(e) To initiate a proceeding to suspend summarily a person's
permit, the comptroller shall serve notice on the permit holder
informing the permit holder of the right to a preliminary hearing
before the comptroller or the comptroller's representative and of
the time and place of the preliminary hearing. The notice must be
personally served on the permit holder or an officer, employee,
or agent of the permit holder or sent by certified or registered
mail, return receipt requested, to the permit holder's mailing
address as it appears in the comptroller's records. The notice
must state the alleged violations that constitute the grounds for
summary suspension. The suspension is effective at the time the
notice is served. If notice is served in person, the permit
holder shall immediately surrender the permit to the comptroller.
If notice is served by mail, the permit holder shall immediately
return the permit to the comptroller.
(f) Section 155.059, governing hearings for final suspension or
revocation of a permit under this chapter, governs a final
administrative hearing.
Added by Acts 1995, 74th Leg., ch. 1000, Sec. 49, eff. Oct. 1,
1995. Amended by Acts 1997, 75th Leg., ch. 1423, Sec. 19.85, eff.
Sept. 1, 1997.
Sec. 155.0592. DISCIPLINARY ACTION FOR CERTAIN VIOLATIONS. (a)
A retailer is subject to disciplinary action as provided by this
section if:
(1) an agent or employee of the retailer commits an offense
under Subchapter H, Chapter 161, Health and Safety Code; and
(2) the retailer, with criminal negligence, failed to prevent
the offense through adequate supervision and training of the
agent or employee.
(b) If the comptroller finds, after notice and an opportunity
for a hearing as provided by this subchapter, that a permit
holder has violated Subchapter H or K, Chapter 161, Health and
Safety Code, at a place of business for which a permit is issued,
the comptroller may suspend the permit for that place of business
or administratively assess a fine as follows:
(1) if the permit holder has not been found to have violated
Subchapter H or K, Chapter 161, Health and Safety Code, at that
place of business during the preceding 12 months, the comptroller
may require the permit holder to pay a fine in an amount not to
exceed $500;
(2) if the permit holder has been found to have violated
Subchapter H or K, Chapter 161, Health and Safety Code, at that
place of business once during the preceding 12 months, the
comptroller may require the permit holder to pay a fine in an
amount not to exceed $750; and
(3) if the permit holder has been found to have violated
Subchapter H or K, Chapter 161, Health and Safety Code, at that
place of business at least twice during the preceding 12 months,
the comptroller may require the permit holder to pay a fine in an
amount not to exceed $1,000 or suspend the permit for that place
of business for not more than three days.
(c) Except as provided by Section 155.0593, if the permit holder
has been found to have violated Section 161.082(b), Health and
Safety Code, on four or more previous and separate occasions at
the same place of business during the preceding 12 months, the
comptroller shall revoke the permit.
(d) A retailer whose permit has been revoked under this section
may not apply for a retailer's permit for the same place of
business before the expiration of six months after the effective
date of the revocation.
Added by Acts 1997, 75th Leg., ch. 671, Sec. 4.08, eff. Sept. 1,
1997. Amended by Acts 1999, 76th Leg., ch. 1157, Sec. 2, eff.
Sept. 1, 1999.
Sec. 155.0593. ACTIONS OF EMPLOYEE. (a) For purposes of
Subchapter H, Chapter 161, Health and Safety Code, and the
provisions of this code relating to the sale or delivery of
cigarettes or tobacco products to a minor, the comptroller may
suspend a permit but may not revoke the permit under Section
155.0592 if the comptroller finds that:
(1) the employer has not violated Section 161.082(b), Health and
Safety Code, more than seven times at the place of business for
which the permit is issued in the 24-month period preceding the
violation in question;
(2) the employer requires its employees to attend a
comptroller-approved seller training program;
(3) the employee has actually attended a comptroller-approved
seller training program; and
(4) the employer has not directly or indirectly encouraged the
employee to violate the law.
(b) The comptroller shall adopt rules or policies establishing
the minimum requirements for approved seller training programs.
On application, the comptroller shall approve seller training
programs meeting the requirements that are sponsored privately or
by public community colleges. The comptroller may charge an
application fee in an amount necessary to defray the expense of
processing the application.
(c) The comptroller may approve under this section a seller
training program sponsored by a permit holder for the purpose of
training its employees without regard to whether the employees
are located at the same place of business. This subsection
applies only to a permit holder who employs at least 100 persons
at any one time during the permit year who sell cigarettes or
tobacco products.
Added by Acts 1997, 75th Leg., ch. 671, Sec. 4.09, eff. Sept. 1,
1997.
Sec. 155.0595. HEARINGS. Unless otherwise provided by this
chapter, the comptroller shall conduct all hearings required by
this chapter in accordance with Chapter 2001, Government Code.
The comptroller may designate one or more representatives to
conduct the hearings and may prescribe the rules of procedure
governing the hearings.
Added by Acts 1991, 72nd Leg., ch. 409, Sec. 50, eff. June 7,
1991. Amended by Acts 1995, 74th Leg., ch. 76, Sec. 5.95(49),
eff. Sept. 1, 1995; Acts 1995, 74th Leg., ch. 1000, Sec. 50, eff.
Oct. 1, 1995; Acts 1997, 75th Leg., ch. 1423, Sec. 19.86, eff.
Sept. 1, 1997.
SUBCHAPTER D. RECORDS AND REPORTS
Sec. 155.101. RECORD OF PURCHASE OR RECEIPT. Each distributor,
wholesaler, bonded agent, and export warehouse shall keep records
at each place of business of all tobacco products purchased or
received. Each retailer shall keep records at a single location,
which the retailer shall designate as its principal place of
business in the state, of all tobacco products purchased and
received. These records must include the following, except that
Subdivision (7) applies to distributors only and Subdivision (8)
applies only to the purchase or receipt of tobacco products other
than cigars:
(1) the name and address of the shipper or carrier and the mode
of transportation;
(2) all shipping records or copies of records, including
invoices, bills of lading, waybills, freight bills, and express
receipts;
(3) the date and the name of the place of origin of the tobacco
product shipment;
(4) the date and the name of the place of arrival of the tobacco
product shipment;
(5) a statement of the number, kind, and price paid for the
tobacco products;
(6) the name, address, permit number, and tax identification
number of the seller;
(7) the manufacturer's list price for the tobacco products;
(8) the net weight as listed by the manufacturer for each unit;
and
(9) any other information required by rules of the comptroller.
Acts 1981, 67th Leg., p. 1674, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1985, 69th Leg., ch. 58, Sec. 35, eff.
March 1, 1986; Acts 1991, 72nd Leg., ch. 409, Sec. 51, eff. June
7, 1991; Acts 1995, 74th Leg., ch. 1000, Sec. 51, eff. Oct. 1,
1995; Acts 1997, 75th Leg., ch. 1040, Sec. 47, eff. Sept. 1,
1997; Acts 1997, 75th Leg., ch. 1423, Sec. 19.87, eff. Sept. 1,
1997.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
285, Sec. 11, eff. September 1, 2009.
Sec. 155.102. REPORT OF SALE OR USE. (a) Each distributor and
wholesaler shall keep at each place of business in this state
records of each sale, distribution, exchange, or use of tobacco
products whether taxed under this chapter or not. Each
distributor and wholesaler shall prepare and retain an original
invoice for each transaction involving tobacco products. Each
distributor or wholesaler shall keep any supporting
documentation, including bills of lading, showing shipment and
receipt used in preparing the invoices at the place of business
of the distributor or wholesaler. The distributor or wholesaler
shall prepare and deliver a duplicate invoice to the purchaser.
(b) The records for each sale, distribution, exchange, or use of
tobacco products must show:
(1) the purchaser's name and address, permit number, or tax
identification number;
(2) the method of delivery and the name of the common carrier or
other person delivering the tobacco products;
(3) the date, amount, and type of tobacco products sold,
distributed, exchanged, or used;
(4) the price received for the tobacco products;
(5) the number and kind of tobacco products on which the tax has
been paid; and
(6) for sales from a manufacturer to a distributor, the
manufacturer's list price for the tobacco products.
(c) In addition to the information required under Subsection
(b), the records for each sale, distribution, exchange, or use of
tobacco products other than cigars must show the net weight as
listed by the manufacturer for each unit.
Acts 1981, 67th Leg., p. 1674, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1991, 72nd Leg., ch. 409, Sec. 51, eff.
June 7, 1991; Acts 1997, 75th Leg., ch. 1040, Sec. 48, eff. Sept.
1, 1997.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
285, Sec. 12, eff. September 1, 2009.
Sec. 155.103. MANUFACTURER'S RECORDS AND REPORTS. (a) A
manufacturer who sells tobacco products to a permit holder in
this state shall keep records showing:
(1) the number and kind of tobacco products sold;
(2) the date the tobacco products were sold;
(3) the name and permit number of the permit holder;
(4) the manufacturer's list price for the tobacco products;
(5) the place where the tobacco products were shipped; and
(6) the name of the common carrier.
(a-1) In addition to the information required under Subsection
(a), the records for each sale of tobacco products other than
cigars must show the net weight as listed by the manufacturer for
each unit.
(b) A manufacturer who sells tobacco products to a permit holder
in this state shall file with the comptroller, on or before the
last day of each month, a report showing the information required
to be listed by Subsections (a) and (a-1), if applicable, for the
previous month.
Acts 1981, 67th Leg., p. 1675, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1991, 72nd Leg., ch. 409, Sec. 51, eff.
June 7, 1991; Acts 1997, 75th Leg., ch. 1423, Sec. 19.88, eff.
Sept. 1, 1997; Acts 1999, 76th Leg., ch. 1467, Sec. 2.44, eff.
Oct. 1, 1999.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
285, Sec. 13, eff. September 1, 2009.
Sec. 155.104. MANUFACTURER'S REPRESENTATIVE'S RECORDS. A
manufacturer's representative shall keep the same records that
are required of a wholesaler. The manufacturer's representative
shall deliver a duplicate of the invoice required by Section
155.102 to the purchaser or recipient of the tobacco products.
Acts 1981, 67th Leg., p. 1675, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1991, 72nd Leg., ch. 409, Sec. 51, eff.
June 7, 1991.
Sec. 155.105. REPORTS BY WHOLESALERS AND DISTRIBUTORS OF CIGARS
AND TOBACCO PRODUCTS. (a) The comptroller may, when considered
necessary by the comptroller for the administration of a tax
under this chapter, require each wholesaler or distributor of
cigars and tobacco products to file with the comptroller a report
each month of sales to retailers in this state.
(b) The wholesaler or distributor shall file the report on or
before the 25th day of each month. The report must contain the
following information for the preceding calendar month's sales in
relation to each retailer:
(1) the name of the retailer and the address of the retailer's
outlet location to which the wholesaler or distributor delivered
cigars or tobacco products, including the city and zip code;
(2) the taxpayer number assigned by the comptroller to the
retailer, if the wholesaler or distributor is in possession of
the number;
(3) the tobacco permit number of the outlet location to which
the wholesaler or distributor delivered cigars or tobacco
products; and
(4) the monthly net sales made to the retailer by the wholesaler
or distributor, including:
(A) the quantity and units of cigars and tobacco products sold
to the retailer; and
(B) for each unit of tobacco products other than cigars, the net
weight as listed by the manufacturer.
(c) Except as provided by this subsection, the wholesaler or
distributor shall file the report with the comptroller
electronically. The comptroller may establish procedures for
allowing an alternative method of filing for a wholesaler or
distributor who demonstrates to the comptroller an inability to
comply with the electronic reporting requirement. If the
comptroller determines that another technological method of
filing the report is more efficient than electronic filing, the
comptroller may establish procedures requiring its use by
wholesalers and distributors.
(d) Except as provided by Section 111.006, information contained
in a report required to be filed by this section is confidential
and not subject to disclosure under Chapter 552, Government Code.
Added by Acts 2007, 80th Leg., R.S., Ch.
129, Sec. 3, eff. September 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
285, Sec. 14, eff. September 1, 2009.
Sec. 155.107. COMMON CARRIER RECORDS. (a) Each common carrier
shall keep records of tobacco products transported in this state.
(b) The comptroller and the attorney general are entitled to
access during regular business hours to all records pertaining to
tobacco products that are transported.
(c) The records must show for each transaction:
(1) the names and addresses of the consignor and consignee;
(2) the date of delivery; and
(3) the amount and type of tobacco products transported or
handled.
Acts 1981, 67th Leg., p. 1670, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1989, 71st Leg., ch. 240, Sec. 72, eff.
Oct. 1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 51, eff. June
7, 1991; Acts 1997, 75th Leg., ch. 1423, Sec. 19.89, eff. Sept.
1, 1997.
Sec. 155.108. BONDED AGENT'S RECORDS. (a) Each bonded agent
shall keep, at each place of business in this state, records of
all tobacco products received, distributed, and delivered.
(b) The records must include:
(1) invoices for receipts and deliveries;
(2) orders for receipts and deliveries;
(3) shipping records for receipts and deliveries; and
(4) shipping records for distribution or delivery.
Acts 1981, 67th Leg., p. 1676, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1991, 72nd Leg., ch. 409, Sec. 51, eff.
June 7, 1991.
Sec. 155.110. AVAILABILITY OF RECORDS. (a) Each permit holder
shall keep records available for inspection and copying by the
comptroller and the attorney general for four years.
(b) If a permit holder's place of business is a vehicle or
vending machine, the permit holder shall designate in the
application for a permit a permanent place of business to keep
the records. The permit holder shall keep the records in the
designated place.
(c) Each permit holder who is required to keep records under
this chapter shall provide the comptroller with copies of the
records on demand.
Acts 1981, 67th Leg., p. 1676, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1985, 69th Leg., ch. 58, Sec. 38, eff.
March 1, 1986; Acts 1989, 71st Leg., ch. 240, Sec. 73, eff. Oct.
1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 51, eff. June 7,
1991; Acts 1997, 75th Leg., ch. 1423, Sec. 19.90, eff. Sept. 1,
1997; Acts 2001, 77th Leg., ch. 540, Sec. 6, eff. Sept. 1, 2001.
Sec. 155.111. DISTRIBUTOR'S REPORT. (a) A distributor shall
file with the comptroller on or before the last day of each
month, a report for the preceding month.
(b) The report must show:
(1) the date the report was made;
(2) the distributor's name and address;
(3) the month the report covers;
(4) the amount of tobacco products purchased, received, and
acquired;
(5) the manufacturer's list price of tobacco products purchased,
received, and acquired;
(6) the amount of tobacco products sold, distributed, used,
lost, or otherwise disposed of;
(7) the amount of tobacco products on hand at the beginning and
the end of the month; and
(8) any other information the comptroller requires relating to
tobacco products and to the payment of taxes due on them.
(b-1) In addition to the information required under Subsection
(b), the report must show the net weight as listed by the
manufacturer for each unit of tobacco products other than cigars
that is purchased, received, or acquired.
(c) The comptroller shall prescribe the form and content of the
report.
(d) If more than 50 percent of all untaxed tobacco products
received by the distributor in this state are actually sold
outside of this state, the distributor shall include in the
report only tobacco products that are sold in this state.
Acts 1981, 67th Leg., p. 1677, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1989, 71st Leg., ch. 240, Sec. 74, eff.
Oct. 1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 51, eff. June
7, 1991; Acts 1997, 75th Leg., ch. 1040, Sec. 49, eff. Sept. 1,
1997; Acts 1997, 75th Leg., ch. 1423, Sec. 19.91, eff. Sept. 1,
1997; Acts 1999, 76th Leg., ch. 1467, Sec. 2.45, eff. Oct. 1,
1999; Acts 2001, 77th Leg., ch. 1263, Sec. 54, eff. Oct. 1, 2001.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
285, Sec. 15, eff. September 1, 2009.
Sec. 155.112. FAILURE TO PRODUCE RECORDS. (a) A person's
failure to produce the records required by this subchapter or a
person's inability to provide other proof of tax payment, on
demand by the comptroller, is prima facie evidence that tobacco
products possessed by the person were received for the purpose of
making a first sale without payment of the tax imposed by this
chapter.
(b) This section does not apply to a person who possesses
tobacco products on which a tax of less than $50 is due, as
provided by Section 155.022.
(c) This section does not apply to a failure to produce records
or provide other proof of tax payment under Subsection (a) if the
failure results from an occurrence beyond the person's control.
Added by Acts 1991, 72nd Leg., ch. 409, Sec. 52, eff. June 7,
1991. Amended by Acts 1997, 75th Leg., ch. 1423, Sec. 19.92, eff.
Sept. 1, 1997.
SUBCHAPTER E. ENFORCEMENT OF TAX
Sec. 155.141. DONATIONS. The comptroller may accept gifts,
grants, and donations for the administration and enforcement of
this chapter.
Added by Acts 1989, 71st Leg., ch. 240, Sec. 75, eff. Oct. 1,
1989. Amended by Acts 1997, 75th Leg., ch. 1040, Sec. 50, Sept.
1, 1997; Acts 1997, 75th Leg., ch. 1423, Sec. 19.93, eff. Sept.
1, 1997.
Sec. 155.143. SEIZURE. (a) The comptroller with or without
process may seize:
(1) tobacco products taxed under this chapter that are possessed
or controlled by a person for the purpose of selling or removing
the tobacco products in violation of this chapter;
(2) tobacco products that are removed, deposited, or concealed
by a person intending to avoid payment of taxes imposed by this
chapter;
(3) an automobile, truck, boat, conveyance, or other type of
vehicle used to remove or transport tobacco products by a person
intending to avoid payment of taxes imposed by this chapter; and
(4) equipment, paraphernalia, or other tangible personal
property used by a person intending to avoid payment of taxes
imposed by this chapter found in the place where the tobacco
products are found.
(b) An item seized under this section is forfeited to the state
and remains in the custody of the comptroller for disposition as
provided by this chapter. The seized item is not subject to
replevin.
Acts 1981, 67th Leg., p. 1678, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1989, 71st Leg., ch. 240, Sec. 76, eff.
Oct. 1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 53, eff. June
7, 1991; Acts 1997, 75th Leg., ch. 1423, Sec. 19.94, eff. Sept.
1, 1997.
Sec. 155.144. COMPTROLLER'S REPORT. (a) If the comptroller
seizes property under Section 155.143, the comptroller shall
immediately make a written report showing:
(1) the name of the person making the seizure;
(2) the place where the property was seized;
(3) the person from whom the property was seized; and
(4) an inventory of the property seized.
(b) The comptroller shall prepare the report in duplicate. The
person who seized the property shall sign the report. The
comptroller shall give the original to the person from whom the
property was seized and shall file a duplicate copy open for
public inspection in the comptroller's office.
Acts 1981, 67th Leg., p. 1678, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1989, 71st Leg., ch. 240, Sec. 77, eff.
Oct. 1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 54, eff. June
7, 1991; Acts 1997, 75th Leg., ch. 1423, Sec. 19.95, eff. Sept.
1, 1997.
Sec. 155.1445. SALE OF SEIZED TOBACCO PRODUCTS. (a) Tobacco
products are perishable items.
(b) If the seized tobacco products are in a salable condition,
the comptroller may sell the tobacco products, return the tobacco
products to the manufacturer for credit, or destroy or dispose of
the tobacco products.
(c) The price obtained at the sale is the market value for the
tobacco products sold.
(d) The comptroller shall place the proceeds from the sale of
seized tobacco products in escrow in a treasury suspense account,
pending the outcome of the forfeiture proceeding provided for in
this chapter.
(e) If a determination is made that the comptroller wrongfully
seized the tobacco products, the person entitled to the tobacco
products at the time of seizure may recover the money held in
escrow in the treasury suspense account.
Added by Acts 1991, 72nd Leg., ch. 409, Sec. 55, eff. June 7,
1991. Amended by Acts 1997, 75th Leg., ch. 1423, Sec. 19.96, eff.
Sept. 1, 1997.
Sec. 155.145. FORFEITURE PROCEEDING. (a) The owner of property
seized under this chapter is entitled to written notice of the
seizure.
(b) The comptroller shall give the notice by certified mail,
return receipt requested, not later than the 15th day after the
date of seizure and shall include with the notice an inventory of
the property seized and a statement that the owner of property
seized is entitled to a hearing on the seizure. Service by mail
is complete when the notice is received, as evidenced by return
receipt from the U.S. Postal Service.
(c) After providing the notice and a hearing, if a hearing is
requested under Subsection (b), the comptroller may order the
forfeiture to the state of any property seized under this chapter
or the proceeds of the sale of any tobacco products seized under
this chapter if the comptroller finds that the property was used,
controlled, possessed, or concealed for the purpose of violating
any provision of this chapter.
(d) The comptroller shall hold property or proceeds forfeited
under this section in escrow until the comptroller's
determination is final and the period for filing a petition for
judicial review has expired.
Acts 1981, 67th Leg., p. 1679, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1989, 71st Leg., ch. 240, Sec. 78, eff.
Oct. 1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 56, eff. June
7, 1991; Acts 1997, 75th Leg., ch. 1040, Sec. 51, eff. Sept. 1,
1997; Acts 1997, 75th Leg., ch. 1423, Sec. 19.97, eff. Sept. 1,
1997.
Sec. 155.1451. DISPOSITION OF FORFEITED PROPERTY. (a) The
comptroller may sell property forfeited to the state at public or
private sale in any commercially reasonable manner.
(b) Subject to the provisions of Section 155.153, the
comptroller shall deposit the sale proceeds, less expenses of
seizure, court costs, and any investigation and audit costs, in
the state treasury.
(c) The comptroller shall use the sale proceeds to operate and
administer the tobacco products tax program up to the amount
appropriated by the legislature for this purpose. The comptroller
shall allocate any sale proceeds that exceed the legislative
appropriation as provided by Subchapter H. Any unused
appropriations remain in the general revenue fund.
Added by Acts 1991, 72nd Leg., ch. 409, Sec. 57, eff. June 7,
1991. Amended by Acts 1997, 75th Leg., ch. 1423, Sec. 19.98, eff.
Sept. 1, 1997.
Sec. 155.150. SEIZURE OR SALE NO DEFENSE. The seizure,
forfeiture, and sale of tobacco products or property under this
chapter, with or without court action, is not a defense to
criminal prosecution for an offense or from liability for a
penalty under this chapter.
Acts 1981, 67th Leg., p. 1680, ch. 389, Sec. 1, eff. Jan. 1,
1982.
Sec. 155.151. WAIVER PERMITTED. (a) The comptroller may waive
a forfeiture proceeding for property seized under Section 155.143
of this code if the owner or possessor of the property:
(1) pays the tax due; and
(2) pays to the state through the comptroller an additional sum
equal to the tax due.
(b) The comptroller may make a compromise with a person before
or after a claim is filed in court. The comptroller shall keep a
record open for public inspection of compromises and waivers of
forfeiture made under this section.
Acts 1981, 67th Leg., p. 1680, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1989, 71st Leg., ch. 240, Sec. 81, eff.
Oct. 1, 1989; Acts 1997, 75th Leg., ch. 1423, Sec. 19.99, eff.
Sept. 1, 1997.
Sec. 155.152. PAYMENT TO TREASURY. The comptroller shall
deposit all taxes collected under this chapter, after payment of
costs, in the treasury to be allocated as provided by Subchapter
H.
Acts 1981, 67th Leg., p. 1680, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1989, 71st Leg., ch. 240, Sec. 82, eff.
Oct. 1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 58, eff. June
7, 1991; Acts 1997, 75th Leg., ch. 1423, Sec. 19.100, eff. Sept.
1, 1997.
Sec. 155.153. PREFERRED STATE TAX LIEN. (a) All taxes, fines,
interest, penalties, and costs due under this chapter are secured
by a preferred lien in favor of the state, first and prior to all
other existing or future liens, contractual or statutory, legal
or equitable, regardless of the time the lien originated, on any
property seized and forfeited under this chapter.
(b) A lienholder who establishes an interest in the property is
entitled to recover any proceeds remaining after payment of all
taxes, interest, penalties, and costs due to the state.
Added by Acts 1991, 72nd Leg., ch. 409, Sec. 59, eff. June 7,
1991.
Sec. 155.154. DONATIONS. The comptroller may accept gifts,
grants, and donations for the administration and enforcement of
this chapter.
Added by Acts 1991, 72nd Leg., ch. 409, Sec. 59, eff. June 7,
1991. Amended by Acts 1997, 75th Leg., ch. 1423, Sec. 19.101,
eff. Sept. 1, 1997.
Sec. 155.155. RECIPROCAL AGREEMENTS. (a) The comptroller may
enter into a reciprocal agreement with a tax official of another
state or an official of the United States allowing the exchange
of information received by, recorded by, prepared by, furnished
to, or collected by the comptroller with respect to the
investigation and enforcement of this chapter for any tax,
penalty, interest, fine, forfeiture, or offense.
(b) This section does not permit the exchange of information
made confidential by this chapter.
Added by Acts 1991, 72nd Leg., ch. 409, Sec. 59, eff. June 7,
1991. Amended by Acts 1997, 75th Leg., ch. 1423, Sec. 19.102,
eff. Sept. 1, 1997.
SUBCHAPTER F. ADMINISTRATION BY COMPTROLLER
Sec. 155.181. COMPLIANCE INVESTIGATION AND RECOVERY OF COSTS.
(a) If the comptroller has reason to believe that a person has
failed to pay a tax or penalty in the proper manner when due or
otherwise failed to comply with this chapter, the comptroller may
employ auditors and investigators to determine compliance and any
amount due. If the comptroller determines that the person has not
paid the tax or penalty or has failed to comply with this
chapter, the comptroller may require the person to pay the
reasonable expenses incurred in the compliance investigation and
audit as an additional penalty.
(b) The comptroller shall deposit funds paid under this section
to the credit of the general revenue fund in the treasury to be
used for making audits, conducting investigations, or as
otherwise appropriated. The comptroller may use other funds
available for audits as appropriated by the legislature.
Acts 1981, 67th Leg., p. 1681, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1989, 71st Leg., ch. 240, Sec. 83, eff.
Oct. 1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 61, eff. June
7, 1991; Acts 1995, 74th Leg., ch. 1000, Sec. 52, eff. Oct. 1,
1995; Acts 1997, 75th Leg., ch. 1423, Sec. 19.104, eff. Sept. 1,
1997.
Sec. 155.182. PAYMENT OF DOUBLE AMOUNT. (a) If the comptroller
finds that a person has sold tobacco products without the tax
having been paid, the comptroller may require the person to pay
the state through the comptroller a sum equal to twice the amount
of tax due.
(b) If a person does not furnish the comptroller with any
evidence showing payment of the tax on tobacco products purchased
by the person, it is presumed that the tobacco products were sold
without reporting and paying the tax.
Acts 1981, 67th Leg., p. 1681, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1989, 71st Leg., ch. 240, Sec. 84, eff.
Oct. 1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 62, eff. June
7, 1991; Acts 1997, 75th Leg., ch. 1423, Sec. 19.105, eff. Sept.
1, 1997.
Sec. 155.183. INSPECTION. (a) To determine the tax liability
of a person dealing in tobacco products or compliance by the
person with this chapter, the comptroller may:
(1) inspect any premises, including a vending machine and its
contents, where tobacco products are manufactured, produced,
stored, transported, sold, or offered for sale or exchange;
(2) remain on the premises as long as necessary to determine the
tax liability or compliance with this chapter;
(3) examine the records required by this chapter or other
records, books, documents, papers, accounts, and objects that the
comptroller determines are necessary for conducting a complete
examination; and
(4) examine stocks of tobacco products.
(b) A person dealing in tobacco products may not:
(1) fail to produce, on the comptroller's demand, records
required by this chapter; or
(2) hinder or prevent the inspection of records or the
examination of the premises.
Acts 1981, 67th Leg., p. 1681, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1989, 71st Leg., ch. 240, Sec. 85, eff.
Oct. 1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 63, eff. June
7, 1991; Acts 1995, 74th Leg., ch. 1000, Sec. 53, eff. Oct. 1,
1995; Acts 1997, 75th Leg., ch. 1423, Sec. 19.106, eff. Sept. 1,
1997.
Sec. 155.184. CREDIT FOR TAX PAID. (a) The comptroller may
adopt rules providing for a credit or refund for tax paid on
tobacco products if the tobacco products have become unfit for
use or consumption or unsalable.
(b) The comptroller may not allow a credit or refund under this
section unless the comptroller is satisfied that the tobacco
products are unfit for use or consumption or unsalable or have
been returned to the manufacturer.
Acts 1981, 67th Leg., p. 1682, ch. 389, Sec. 1, eff. Jan. 1,
1982. Amended by Acts 1989, 71st Leg., ch. 240, Sec. 86, eff.
Oct. 1, 1989; Acts 1991, 72nd Leg., ch. 409, Sec. 63, eff. June
7, 1991; Acts 1997, 75th Leg., ch. 1423, Sec. 19.107, eff. Sept.
1, 1997.
Sec. 155.185. DEFICIENCY DETERMINATION, PENALTIES, AND INTEREST.
(a) If the comptroller has reasonable cause to believe that a
tax report or the amount of tax is inaccurate, the comptroller
may compute and determine the amount of tax, penalty, and
interest to be paid from information contained in the report or
from any other information available to the comptroller.
(b) On making a deficiency determination, the comptroller shall
notify the person by personal service or by mail. Service by mail
is complete when the notice is deposited with the U.S. Postal
Service.
Added by Acts 1991, 72nd Leg., ch. 409, Sec. 64, eff. June 7,
1991. Amended by Acts 1995, 74th Leg., ch. 1000, Sec. 54, eff.
Oct. 1, 1995; Acts 1997, 75th Leg., ch. 1423, Sec. 19.108, eff.
Sept. 1, 1997; Acts 1999, 76th Leg., ch. 1467, Sec. 2.46, eff.
Oct.