Nottawaseppi Huron Band of the Potawatomi, MI Chapter 10.4 Sale of Tobacco Products

[HISTORY: Adopted by the Tribal Council of the Nottawaseppi Huron Band of the Potawatomi 7-15-2009 by Res. No. 07-15-09-05 (Title X, Ch. 3, of the Tribal Code); amended in its entirety 7-18-2019 by Res. No. 07-18-19-09. Subsequent amendments noted where applicable.]

GENERAL REFERENCES

Tobacco products and tobacco use — See Ch. 8.15.

Article I Registration of Retailers Selling Tobacco Products; Regulation of Sales of Tax-Free Tobacco Products

§ 10.4-1 Purpose.

The purpose of this article is to provide a framework for ensuring that tobacco products purchases and sale transactions by retailers within the jurisdiction of the Tribe are understood, undertaken in compliance with legal obligations under the tax agreement between the Nottawaseppi Huron Band of the Potawatomi and the State of Michigan,[1] and to ensure uniformity of procedures.

[1] Editor's Note: See Ch. 10.1, Tax Agreement, of this Code.

§ 10.4-2 Definitions.

For purposes of this article, the following terms have the meanings assigned to them in this section:

COLLECTION AGENT

Any seller of or making sales at retail of tobacco products from a location within tribal and trust lands.

GAAP

United States generally accepted accounting principles consistently applied to tribal government operations as set out in Governmental Accounting Standards Board statements.

PERSON

Any natural person, corporation, limited liability company, other business entity, or any government and its political subdivisions or instrumentality.

PURCHASER

Any person that purchases tobacco products at retail.

SALES AT RETAIL OR RETAIL SALE

A sale, lease or rental of tangible personal property for any purpose other than for resale, sublease or subrent.

STATE

The State of Michigan.

TAX AGREEMENT

The tax agreement between the Nottawaseppi Huron Band of the Potawatomi and the State of Michigan, dated December 20, 2002, as the same may be amended from time to time.[1]

TAX AGREEMENT AREA

The area designated as such in Appendix A of the tax agreement, as the same may be amended from time to time.[2]

TAX DEPARTMENT

The division of the tribal government charged with the implementation and administration of this article.

TRIBAL AND TRUST LANDS

All fee lands owned by the Tribe and lands held in trust by the federal government for the benefit of the Tribe, which are designated as tribal and trust lands in Appendix A of the tax agreement, as the same may be amended from time to time.[3]

TRIBAL MEMBER

An individual who is an enrolled member of the Tribe.

TRIBE

The Nottawaseppi Huron Band of the Potawatomi. The term "Tribe" includes all divisions or subdivisions of the tribal government and business enterprises, including chartered entities or instrumentalities, that are wholly owned by the Tribe.

[1] Editor's Note: See Ch. 10.1, Tax Agreement, of this Code.

[2] Editor's Note: Said Appendix A is attached to Ch. 10.1, Tax Agreement, of this Code.

[3] Editor's Note: Said Appendix A is attached to Ch. 10.1, Tax Agreement, of this Code.

§ 10.4-3 Tobacco products retailers.

A. Licensing of retailers. Any retailer engaged in the sale at retail of tobacco products from any location on tribal and trust lands shall be required to possess or obtain a retailer tax license from the Tribe as prescribed in the Chapter 10.3, Retail Sales and Food and Beverage Tax.

B. Sale of tax-exempt tobacco products. Only those retailers authorized by Tribal Council resolution may purchase tax-exempt tobacco products under the Tribe's tax-exempt quota established under the tax agreement. Licensed retailers shall be limited to that portion of the tax-exempt quota as may be designated by the Tribal Council.

C. Registration conditions applicable to retailers licensed to sell tobacco products. Any retailer licensed to engage in the sale at retail of tobacco products shall, as a condition of obtaining that license and/or registration, be required to agree to comply with the following requirements:

(1) The retailer must purchase all tobacco products from a state-licensed wholesaler;

(2) All tobacco products offered for sale by the retailer must bear the state tribal stamp;

(3) The retailer must agree to maintain such books and records as would be required under state law for retailers licensed by the state to engage in the sale at retail of tobacco products;

(4) In addition to maintaining the books and records required by state law, all retailers authorized to sell tax-exempt tobacco products to the Tribe or tribal members shall maintain a log of each purchase of tax-free tobacco products, showing date, type (cigarettes, cigar, chew, etc.), quantity and brand, together with the name, tribal identification number and signature of the purchaser. The purchaser's signature shall not be required if a swipe-card system, acceptable to both the Tribe and the state, is utilized;

(5) The retailer shall identify whether it will operate tobacco products vending machines and, if so, if the retailer will supply and stock the tobacco products for its vending machines;

(6) The retailer shall specify the specific location(s) (utilizing facility floor plans if available) on its premises where tobacco products will be offered for sale (including the location of vending machines) and the location(s) where the retailer stores its inventory of tobacco products; and

(7) The retailer shall permit representatives of the state access to the retailer's premises for the purpose of conducting inspections, including unannounced inspections of locations where tobacco products are sold and stored as well as any vehicles used to transport tobacco products.

§ 10.4-4 Retail sales of tax-free tobacco products.

A. Designation of authorized retailer for tax-exempt tobacco products. FireKeepers Casino shall be the designated retail outlet that is assigned 100% of the Tribe's tax-free quota for tobacco products and is authorized to purchase tax-free quota tobacco products from the wholesale distributor designated by the Tribal Council for resale to tribal members without payment of the Michigan tobacco products tax.

B. Purchases subject to Michigan tobacco products tax. Unless exempted by the tax agreement and this article, all purchases of tobacco products by tribal members within tribal and trust lands of the Tribe shall be subject to the imposition and collection of the Michigan tobacco products tax, which shall be added to the purchase price. Retailers operating within tribal and trust lands shall remit tax proceeds and provide information as required under the provisions of the Tobacco Products Tax Act, MCLA § 205.421 et seq., as it may be amended from time to time.

C. Limits on purchases of tax-free tobacco products by tribal members.

(1) Tribal members may purchase tobacco products from the designated retailer without payment of the Michigan tobacco products tax, provided the purchase is solely for personal use and not for resale.

(2) Tribal members shall be prohibited from purchasing more than the posted limit of tax-free tobacco products on any day or month, as follows.

(a) Daily limits:

[1] Three cartons of tax-exempt cigarettes per tribal member;

[2] Seven tins of tax-exempt smokeless tobacco per tribal member; and

[3] Twelve individual tax-exempt cigars or one box of tax-exempt cigars per tribal member.

(b) Monthly limits:

[1] Fifteen cartons of tax-exempt cigarettes per tribal member.

(c) The designated retailer shall include the full amount of the Michigan tobacco products tax in the price of all tobacco products sold to tribal members in excess of the posted limit on any day or month.

(3) The daily or monthly limit for tax-free purchases may be adjusted quarterly by the Tribe's Tax Department, based on the remaining quota tax-exempt cigarettes available for the balance of the calendar year. Adjusted purchase limits, if any, will be posted by the Tax Department at the designated retailer.

(4) Tribal members shall be solely responsible for staying within the daily and monthly purchase limits posted at the designated retailer. Tribal members are required to keep track of their own tax-free purchases of tobacco products.

(5) All sales of tobacco products to tribal members in excess of the total annual ceiling for tax-exempt tobacco products sales agreed to by the Tribe and the state shall include the full amount of the Michigan tobacco products tax.

(6) The Tax Department shall audit the records of designated retailers to enforce the limits prescribed in this article. Tribal members who purchase tax-free cigarettes above the daily or monthly limits established shall be responsible for paying the tobacco products tax on excess purchases. Civil penalties will be assessed on excess purchases.

D. Civil penalties; remedies.

(1) Any person who violates Subsection C(1) of this section by selling or giving one or more pack(s) of tax-free tobacco products to a person who is not a tribal member shall be guilty of a civil infraction and shall be subject to a civil penalty of $250. Each transaction by which a person violates Subsection C(1) shall be treated as a separate offense.

(2) Any person who violates Subsection C(2) of this section shall be guilty of a civil infraction and shall be subject to a civil penalty of $50. Each transaction by which a person violates Subsection C(2) shall be treated as a separate offense.

(3) The civil penalties provided for in this section are not intended to be exclusive but shall be in addition to and independent of:

(a) Seizure of tobacco products possessed in violation of the tax agreement or this article;

(b) Suspension of a tribal member's privilege to purchase tax-free tobacco products for up to one year; and

(c) Prosecution or other enforcement action under tribal, federal, or state law.

§ 10.4-5 Severability.

If any provision of this article or its application to any person or circumstances is held invalid, the invalidity does not affect other provisions or applications that can be given effect without the invalid provision or application.