Unless provided otherwise, this chapter shall apply to the taxation of all cigarettes and other tobacco products brought into or acquired in the municipality.
(AO No. 2013-125, § 1, 1-1-2014)
The following words, terms and phrases, when used in this chapter, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning:
means a person who brings cigarettes or other tobacco products or causes them to be brought into the municipality, and who sells or distributes such products exclusively to other businesses located outside the municipality for resale outside the municipality. A person licensed as a bonded distributor in accordance with this chapter is automatically registered under section 12.40.028 for the term of the license.
includes all manners, ways and modes of bringing into or obtaining cigarettes or other tobacco products in the municipality.
means a natural person who brings into or acquires in the municipality cigarettes or other tobacco products, that are subject to tax under this chapter, for his or her own consumption from any source other than a manufacturer, cigarette distributor, other tobacco products distributor, direct-buying retailer or retailer.
means the chief fiscal officer of the municipality or designee.
means a roll for smoking of any size or shape, made wholly or partly of tobacco, whether the tobacco is flavored, adulterated or mixed with another ingredient, if the wrapper or cover of the roll is made of paper or a material other than tobacco.
means a person who brings cigarettes or causes them to be brought into the municipality, and who sells or distributes at least 75 percent of the cigarettes to retailers for resale and sells no more than 25 percent to consumers.
means a person who engages in the sale of cigarettes directly to consumers from one or more retail locations in the municipality. A cigarette retailer includes a person who operates a vending machine from which cigarettes are sold to consumers at a retail location in the municipality, whether the vending machine is installed on the person's own premises or installed elsewhere.
means a mandatory deduction available only to a bonded distributor on its tax return, applying to all cigarettes and other tobacco products acquired during the period being reported, which is conditioned upon the eventual sale of the related cigarettes and/or other tobacco products to a person qualified in accordance with section 12.40.028 of this chapter. Such sale must take place within 12 months from the date the bonded distributor acquired the products for which the deduction is claimed. A conditional deduction claimed for cigarettes and other tobacco products in the on-hand inventory of the bonded distributor expires when the bonded distributor's license is revoked or expires in accordance with this chapter. Reporting a conditional deduction precludes claiming any other type of deduction for the related tobacco product acquired.
means the finance department of the municipality.
means a person who is engaged in the sale of cigarettes and/or other tobacco products at retail in the municipality, and who brings or causes them to be brought into the municipality.
means the effective date and details of a count by description, including the trade name and brand, purchase price and total quantity on-hand of all cigarettes and other tobacco products. Detail must be subtotaled and distinguished between cigarettes and other tobacco products which are taxable and cigarettes and other tobacco products which were acquired exempt of the municipal excise tax under this chapter.
means a person required to be licensed under section 12.40.035.
means a person who makes, fashions or produces cigarettes or other tobacco products for sale to cigarette distributors, other tobacco products distributors, bonded distributors, direct-buying retailers, or other persons within the municipality.
means Municipality of Anchorage.
means cigarettes and other tobacco products that are:
means:
A cigar;
A cheroot;
A stogie;
A perique;
Snuff and snuff flour;
Smoking tobacco, including granulated, plug-cut, crimp-cut and ready-rubbed tobacco, and any form of tobacco suitable for smoking in a pipe or cigarette;
Chewing tobacco, including cavendish, twist, plug or scrap tobacco and tobacco suitable for chewing;
An article or product made wholly or in part of tobacco or a tobacco substitute or otherwise containing nicotine that is expected or intended for human consumption, whether smoked, heated, chewed, absorbed, dissolved, inhaled or ingested by any other means, but not including cigarettes or smoking cessation products; or
An electronic smoking device which can be used to deliver aerosolized or vaporized nicotine to the person inhaling from the device, including, but not limited to, an e-cigarette, e-cigar, e-pipe, vape pen or e-hookah. An electronic smoking device includes any component, part, or accessory of such a device, whether or not sold separately, and includes any substance intended to be aerosolized or vaporized during the use of the device, whether or not it contains nicotine. An electronic smoking device does not include any battery or battery charger when sold separately or smoking cessation products.
means a person who brings other tobacco products or causes them to be brought into the municipality, and who sells or distributes at least 75 percent of the other tobacco products to retailers for resale and sells no more than 25 percent to consumers.
means a person who engages in the sale of other tobacco products directly to consumers from one or more retail locations in the municipality. Other tobacco products retailer includes a person who operates a vending machine from which other tobacco products are sold to consumers at a retail location in the municipality, whether the vending machine is installed on the person's own premises or installed elsewhere.
includes an individual, company, partnership, joint venture, joint agreement, association (mutual or otherwise), corporation, estate, trust, business trust, receiver or trustee, syndicate, or political subdivision of this state, or combination acting as a unit including individuals who are employees or officers of any of the such entities who are under a duty to perform an act concerning which a violation of this chapter could occur. It is the intent of this chapter that such persons be personally liable for unremitted taxes.
means a place where cigarettes or other tobacco products are sold, or where they are brought or kept for the purpose of sale or consumption, including a vessel, vehicle, airplane or train.
means the acquisition of ownership or possession of cigarettes or other tobacco products from any source.
means a group of logically related fields of information concerning events affecting an organization, which is an integral part of an accounting information system, where separate, identifiable transaction data is entered as historical data.
means a sale to a consumer or to any person for any purpose other than for resale.
means a person in the State of Alaska who is engaged in the business of selling cigarettes or other tobacco products at retail.
includes a sale, barter, exchange and every other manner of transferring the ownership of personal property.
means any FDA-approved tobacco cessation drug, device, or a combination product that is intended to help quit tobacco use, as those terms are defined in the Federal Food, Drug and Cosmetic Act (21 USC § 321).
means the cigarette and other tobacco products excise tax assessed pursuant to this chapter.
means the monthly report to be submitted to the department as required by section 12.40.090.
means the established price for which a manufacturer sells other tobacco products to a distributor or other person, after deduction of a discount or other reduction received by the distributor for quantity of cash. For purposes of determining wholesale price when the purchase is being made from a distributor or other person rather than a manufacturer, a uniform deduction of 30 percent may be applied to the invoice price paid for the other tobacco products.
(AO No. 2013-125, § 1, 1-1-2014; AO No. 2018-107, § 1, 1-1-2019; AO No. 2020-89(S), § 1, 3-1-2021; AO No. 2020-132, § 1, 3-1-2021)
A.
The municipality hereby levies an excise tax of 110.3 mills, adjusted annually as provided in subsection B of this section, on each cigarette brought into the municipality after December 31, 2010. Cigarettes upon which the tax is imposed are not again subject to the tax when acquired by another person.
B.
The annual Consumer Price Index adjustment shall be based on the August release date of the semiannual report for the municipality from the U.S. Department of Labor statistics and determined to be the percent change to the current year from the average of the first and second half of the prior year, and will be effective January 1 of each year following the August release date. The first such adjustment date shall be January 1, 2012.
C.
The tax imposed by this section does not apply to the first 400 cigarettes personally transported into the municipality by an individual for that individual's personal consumption during a calendar month.
(AO No. 2013-125, § 1, 1-1-2014)
A.
An excise tax of 55 percent of the wholesale price is levied on other tobacco products, other than cigarettes, brought into the municipality. The tax is levied effective January 1, 2011. Other tobacco products upon which this tax is imposed are not again subject to this tax when acquired by another person.
B.
The tax imposed by this section does not apply to the first $100.00 of other tobacco products personally transported into the municipality by an individual for that individual's personal consumption during a calendar month.
(AO No. 2013-125, § 1, 1-1-2014)
A.
It is the intent and purpose of this chapter to collect the tax from the person who:
1.
First acquires the cigarettes or other tobacco products within the municipality;
2.
Brings, or causes cigarettes or other tobacco products to be brought into the municipality;
3.
Makes, manufactures, or fabricates cigarettes or other tobacco products in the municipality;
4.
Ships or transports cigarettes or other tobacco products into the municipality; or
5.
Commits, or is complicit in, an act of tax evasion resulting in the municipality being deprived of the tax due under this chapter.
Notwithstanding anything to the contrary contained in this chapter, the taxpayer shall be those persons described in this section and no others.
(AO No. 2013-125, § 1, 1-1-2014)
A.
Military. Cigarettes and other tobacco products brought into or acquired in the municipality by a military exchange, commissary, or ship's store operated by one of the uniformed services of the United States as defined in 5 U.S.C. section 2101 are exempt from tax under this chapter if the cigarettes and other tobacco products are sold to and for the sole use of authorized personnel according to current military regulations.
1.
Cigarettes and other tobacco products brought into or acquired in the municipality by a military exchange, commissary, or ship store and sold to, or for the use of unauthorized personnel are not exempt from the tax under this chapter.
2.
Cigarettes or other tobacco products brought into or acquired in the municipality by an independent contractor and sold to consumers within the military installations are not exempt from the tax under this chapter.
3.
A person claiming an exemption under this section for the sale of cigarettes or other tobacco products directly to a military exchange, commissary, or ship's store operated by one of the uniformed services of the United States shall file, with a tax return under section 12.40.090, a certification on a form provided by the department for each exempt sale claimed under this section. The certification shall be in the form of an affidavit, and must be signed by an authorized agent of the military exchange, commissary, or ship's store. The certification shall contain a statement that the cigarettes and/or other tobacco products purchased will be sold solely to and for the use of authorized personnel in accordance with military regulations. The invoice supporting the sale to the military exchange, commissary, or ship's store must accompany the certification.
4.
If the department determines that cigarettes or other tobacco products sold under the exemption provided in this subsection were available for the use or purchase by unauthorized personnel, the department shall assess the tax under this chapter to the person making the sale.
B.
Supremacy clause. The tax imposed under this chapter does not apply to cigarettes and other tobacco products if the United States Constitution or other federal laws prohibit the levying of this tax on such products by the municipality.
C.
Resale outside the municipality. Provided all persons otherwise subject to this chapter comply with its requirements, cigarettes and other tobacco products:
D.
Provided all persons otherwise subject to this chapter comply with its requirements, electronic smoking devices are exempt from the tax imposed under this chapter when sold to a marijuana retail establishment in Alaska licensed under section 10.80.300 or state law, or to an industrial hemp retail establishment registered with the state, only if these businesses are not licensed to sell tobacco related products containing nicotine and, except for electronic smoking devices, are not otherwise engaged in the business of selling cigarettes and other tobacco products.
(AO No. 2013-125, § 1, 1-1-2014; AO No. 2020-89(S), § 2, 3-1-2021; AO No. 2020-132, § 2, 3-1-2021)
A.
Except as otherwise provided herein, no person may acquire cigarettes or other tobacco products in the municipality exempt of the tax unless that person has registered with the department in accordance with this chapter. No licensee shall claim any deduction under this chapter unless cigarettes or other tobacco products for which any deduction is claimed have been sold or transferred to a person registered with the department in accordance with this chapter prior to such sale or transfer.
1.
Any person whose principal place of business is located outside the municipality and who acquires cigarettes or other tobacco products in the municipality for resale outside the municipality at his or her principal place of business may apply for registration with the department to acquire cigarettes or other tobacco products in the municipality exempt of the tax provided such person has a valid State of Alaska business license with a tobacco endorsement and relevant line of business code or equivalent thereon.
2.
A business having more than one location outside the municipality shall apply with the department to register each separate location that will or does receive tax-exempt cigarettes and other tobacco products directly from a distributor in the municipality.
B.
Application for registration to acquire cigarettes or other tobacco products in the municipality exempt of the tax shall be on a form provided by the department, and shall include the following information and such other information as the department may require:
1.
The applicant's name and mailing address;
2.
A copy of the applicant's current State of Alaska business license, including a tobacco endorsement and the line of business (LOB) code or equivalent;
3.
The business name and location(s) where cigarettes and other tobacco products will be sold;
4.
The applicant's signature, firmly binding the applicant to an agreement that any contemporaneous or future complaints filed by the department in the Alaska Court System related to responsibilities, duties, consequences, or disputes associated with this chapter shall at all times be within the venue of the Anchorage District or Superior courts located in Anchorage, Third Judicial District;
5.
The applicant's signature, firmly binding the applicant, in the event the applicant subsequently commits civil fraud as defined by this chapter, to an obligation to remit to the municipality an amount that equals the taxes that would have been paid to the municipality if all the cigarettes and other tobacco products acquired exempt of the tax by the applicant would have been fully taxable under this chapter;
6.
The applicant's signature, firmly binding the applicant, either business or natural person, to an agreement that, in the event the department revokes the applicant's registration in accordance with section 12.40.033, the applicant will become ineligible to register under this section for a period of five years, beginning with the date of revocation;
7.
The applicant's signature confirming that the applicant fully understands the relevant compliance requirements of this chapter;
8.
The applicant's signature authorizing the local government(s) of the jurisdiction(s) where the applicant business is physically located to release copies of tax returns filed by the applicant business to the department upon request by the department;
9.
Each signature shall be by a person or agent having such authority to sign and bind the applicant and shall be under penalty of prosecution for unsworn falsification; and
10.
Except for an applicant having more than one business location outside the municipality, each application for registration shall be accompanied by a fee of $100.00. For an applicant having more than one business location outside the municipality, the fee for registration shall be $100.00 for the first location being registered and $10.00 for each additional business location being registered.
C.
All persons registered under this section shall maintain compliance with all relevant State of Alaska laws and administrative requirements related to the registered business, including but not necessarily limited to: business license, tobacco endorsement, and any related required periodic reporting.
D.
All persons applying for registration under this section shall be current with all financial obligations due to the municipality.
E.
A registration under this section is valid from the date the department approves registration until the following June 30.
F.
The department may refuse to register an applicant if there is reasonable cause to believe that
1.
The applicant has structured its business organization to avoid ineligible status;
2.
The applicant has structured its business to avoid payment of amounts due under this chapter; or
3.
The applicant is responsible for any act or omission by any person which withholds, misstates or provides false or misleading information required by the department.
G.
A person whose registration is revoked becomes ineligible to register under this section for a period of five years, beginning with the date of revocation.
H.
A natural person whose acts result in revocation of registration becomes ineligible to register under this section.
I.
The department shall maintain and publish a current listing of businesses registered under this section for use by a licensee to confirm if a merchant customer is eligible to purchase cigarettes and/or other tobacco products exempt of the tax imposed by this chapter.
(AO No. 2013-125, § 1, 1-1-2014)
A.
Registration under section 12.40.028 expires on June 30. A person, upon application to the department accompanied by the renewal fee, may, on or before June 30, renew registration for one calendar year from the expiration date.
1.
If there is a change in ownership of the registered business, registration shall automatically expire.
2.
If the person who signed the application ceases to have the authority to bind the registered business, then registration shall automatically expire.
3.
If the name of the registered business is changed or the registered business is moved to another location, the registration shall automatically expire. Upon application to the department, registration may be renewed without fee for the new name and/or new location of the business for the balance of the 12-month term of registration.
(AO No. 2013-125, § 1, 1-1-2014)
A.
No person may sell, purchase, possess or acquire cigarettes and/or other tobacco products in the municipality as a manufacturer, bonded distributor, cigarette distributor, other tobacco products distributor, direct-buying retailer, cigarette retailer, other tobacco products retailer, or buyer without a proper and current license issued under this chapter.
B.
The department, upon proper application and payment of the fee, shall issue a license to the applicant. A copy of the applicant's current license required under AS 43.50.010—43.50.390 shall accompany the application. The application shall include the following information:
1.
The applicant's name and physical address of business;
2.
The name under which the cigarette and/or other tobacco products business will be conducted;
3.
The applicant's cigarette and/or other tobacco products business categories as a manufacturer, bonded distributor, cigarette distributor, other tobacco products distributor, direct-buying retailer, cigarette retailer, other tobacco products retailer, or buyer;
4.
In the case of a business with vending machines, the number of vending machines which will be operated and their locations; and
5.
Other information required on the department's application form.
C.
The department may deny an application for a license if there is reasonable cause to believe that the applicant has willfully withheld information requested to determine the applicant's eligibility to receive a license, if there is reasonable cause to believe that information submitted in the application is false or misleading and is not made in good faith, if there is reasonable cause to believe that the applicant has structured its business organization to avoid payment of delinquent taxes, penalties, interest, or costs due under this chapter, if the applicant has a substantial unpaid financial obligation due to the municipality, or if the applicant previously had a license under this chapter revoked by the department within the previous ten years. The department shall provide the reasons for a denial in writing to the applicant.
D.
A license required by this chapter is in addition to any other license required by law.
E.
A license issued under this chapter shall include:
1.
The name and address of the licensee and name of licensed business;
2.
The authorized capacity and extent of business to be conducted, including permissible acquisition methods for acquiring cigarettes and/or other tobacco products and permissible methods for the sale of cigarettes and/or other tobacco products;
3.
The address at which the licensed business is conducted; and
4.
The year for which the license is issued.
F.
If a licensee has more than one business location in the municipality, a separate license is required for each such location.
G.
A licensee shall prominently display the license required by this chapter at each registered place of business.
(AO No. 2013-125, § 1, 1-1-2014)
A.
Except for a licensee having more than one business location in the municipality, the fee for the issuing or renewing a license shall be $75.00. For a licensee having more than one location in the municipality, the fee for issuing or renewing a license shall be $75.00 for the first location and $10.00 for each additional business location.
B.
For a buyer, each license issued under this chapter, and for each renewal, the fee is waived.
(AO No. 2013-125, § 1, 1-1-2014)
Each bonded distributor shall provide a surety bond in an amount to be determined by the chief fiscal officer, but no less than $250,000, prior to the issuance of a license under this chapter. The requirement for a bond shall remain in force for the entire period of the license issued under this chapter. A license for bonded distributor issued under this chapter shall automatically expire when the required bond lapses, is not renewed, expires, is modified without consent of the chief fiscal officer, is cancelled, or is otherwise terminated. In the event the municipality exercises a claim against the bond, the licensee shall provide an additional bond, in an amount equal to the amount of the paid claim, no later than 30 days after the date such claim was paid. Failure to renew the bond as required by this section shall result in automatic revocation of the license issued under this chapter.
(AO No. 2013-125, § 1, 1-1-2014)
A license issued under section 12.40.035 expires on December 31. A licensee, on application to the department accompanied by the renewal fee, may, before the expiration of the license, renew the license. If the licensee moves the business to another location within the municipality, the license automatically expires; the licensee shall immediately file an application with the department, without fee, for issuance of a new license for the new location for the balance of the unexpired term. A person whose license is lost, stolen or defaced shall immediately file an application with the department for reissuance of the license for the balance of the unexpired term.
(AO No. 2013-125, § 1, 1-1-2014)
A license issued under this chapter is not assignable or transferable. However, in the case of death, bankruptcy, receivership or incompetency of the licensee, or if the business of the licensee is transferred to another person by operation of law, the department may in its discretion, or under a valid order of a court of competent jurisdiction, extend the license for a limited time to the executor, administrator, trustee or receiver, or the transferee of the licensee.
(AO No. 2013-125, § 1, 1-1-2014)
A.
The department shall not refund the license fee paid pursuant to this chapter upon the surrender or revocation of a license after the beginning of the license year. Upon application, the department may refund a license fee that is paid or collected in error.
B.
The department shall not refund the registration fee paid pursuant to this chapter.
C.
If a remittance by a licensee exceeds the amount due, and the department, on audit of the account in question, is satisfied that this is the case, the department shall, upon written request of the licensee, refund the excess to the licensee without interest.
D.
In no case shall more tax be refunded than was originally remitted to the municipality. If tax was remitted based on a lower cigarette mill rate, a lower other tobacco products tax rate, or a lower other tobacco products wholesale price, the refund will be limited to that basis even if the cigarettes and/or other tobacco products are reported on the tax return for a month with a higher cigarette mill rate, a higher other tobacco products tax rate, and/or a higher other tobacco products wholesale price.
E.
Any claim for refund filed more than one year after the due date of the tax is forever barred.
(AO No. 2013-125, § 1, 1-1-2014)
C.
No person whose license is suspended or revoked shall acquire, sell, or offer to sell cigarettes or other tobacco products or permit cigarettes or other tobacco products to be sold or offered for sale during the period of the suspension or revocation on the premises occupied or controlled by that person. No disciplinary proceeding or action is barred or abated by the expiration, transfer, surrender, renewal or extension of a license issued under section 12.40.035.
D.
Conditional deductions previously claimed for cigarettes and other tobacco products in the on-hand inventory of a bonded distributor expire when the bonded distributor's license is surrendered, suspended, or revoked.
(AO No. 2013-125, § 1, 1-1-2014)
On or before the last day of each calendar month each manufacturer, bonded distributor, cigarette distributor, other tobacco products distributor, direct-buying retailer, or buyer shall submit to the department a tax return, upon forms provided by the department, for each license, and submit payment for the taxes due.
A.
The return shall be signed under penalty of perjury by the licensee or agent and must include:
1.
The name and address of the licensee.
2.
The name and address of the person filing the return, if different from the licensee.
4.
The name under which the cigarette or tobacco business is being conducted.
5.
The number of cigarettes manufactured, brought into or acquired in the municipality during the preceding month from any source whatever.
6.
The wholesale price of all other tobacco products brought into or acquired in the municipality during the preceding month from any source whatever.
7.
The names of persons from whom cigarettes and other tobacco products were brought into or acquired in the municipality during the preceding month from any source whatever.
8.
The number of cigarettes brought into or acquired in the municipality from each person named in subsection A.7 of this section.
9.
The number of cigarettes and the wholesale price of other tobacco products for which deductions are claimed under section 12.40.025 of this chapter.
10.
The number of cigarettes and the wholesale price of other tobacco products acquired during the period being reported for which conditional deductions are claimed.
11.
The amount of tax due on the nonexempt cigarettes manufactured, brought into or acquired in the municipality during the preceding month; and the amount of tax due based on the wholesale price of nonexempt other tobacco products manufactured, brought into or acquired in the municipality during the preceding month.
12.
Other information and supporting documentation which may be required by the department with the return.
B.
Each distributor shall report the cigarette and other tobacco product sales for which an exemption is claimed under section 12.40.025. as a deduction on its monthly tax return to the department and shall provide a copy of an invoice or other document satisfactory to the department supporting each sale of exempt product.
C.
A tax return must be filed even if there were no cigarettes or tobacco products manufactured, brought into or acquired in the municipality during the preceding month.
D.
The taxes imposed under this chapter and the return required by this section must be received by the department or postmarked on or before the last day of each calendar month following the month reported in the return.
(AO No. 2013-125, § 1, 1-1-2014)
If a licensee fails to file a return as required by section 12.40.090, or when the department finds that a return is not supported by the records to be maintained pursuant to section 12.40.190, the department may prepare and file a return on behalf of the licensee. Involuntary returns filed under this section may be premised upon any information that is available to the department, including, among other things, comparative data for similar businesses. A licensee for whom an involuntary return is filed under this section shall be subject to liability for the tax stated in the return, as well as subject to the penalties and interest provided for in this chapter. A return prepared by the department is, prima facie evidence good and sufficient for all legal purposes. However, nothing prevents the licensee from presenting evidence on an appeal under section 12.40.170 in order to rebut the presumed sufficiency of a return prepared by the department, nor does the presumption of sufficiency alter the parties' respective burdens of proof once the licensee has presented evidence to rebut that presumption.
(AO No. 2013-125, § 1, 1-1-2014)
(AO No. 2013-125, § 1, 1-1-2014)
Any payment submitted to the department for any taxes, penalties, interest or costs due under any provision of this chapter or any return or any finding or determination by the department under this chapter shall be credited to the monthly tax period for which remitted first to the payment of costs and then to penalties, interest and taxes, in that order.
(AO No. 2013-125, § 1, 1-1-2014)
A.
A licensee may not ship or transport, or cause to be shipped or transported, exempt cigarettes or exempt other tobacco products to any person other than to a bonded distributor or a merchant's business location outside the municipality registered under section 12.40.028.
B.
A person who ships or transports, or causes to be shipped or transported, cigarettes to a person in the municipality shall plainly and visibly mark the container or wrapping with the word "cigarettes" if the cigarettes are shipped or transported in a container or wrapping other than the cigarette manufacturer's original container or wrapping.
C.
A person who ships or transports, or causes to be shipped or transported, other tobacco products to a person in the municipality shall plainly and visibly mark the container or wrapping with the words "other tobacco products" if the other tobacco products are shipped or transported in a container or wrapping other than the other tobacco products manufacturer's original container or wrapping.
D.
A licensee shall provide to the person shipping or transporting the cigarettes or other tobacco products, documentation identifying at a minimum the seller; purchaser; owner in transit; type, brand, and quantity of product shipped or transported; and whether the product was sold as taxed or exempt under this chapter.
E.
A person taking possession of cigarettes or other tobacco products from a licensee to be shipped or transported to a customer shall obtain from the licensee documentation identifying at a minimum the seller; purchaser; owner in transit; type, brand, and quantity of product shipped or transported; and whether the product was sold as taxed or exempt under this chapter. Such documentation shall be with the cigarettes or other tobacco products at all times during transit and shall be available for inspection upon demand by the department or any peace officer.
(AO No. 2013-125, § 1, 1-1-2014)
A.
A person shall not:
1.
Import cigarettes or other tobacco products into the municipality in violation of or without complying with the provisions of this chapter;
3.
Participate in the importation into the municipality or in the sale, transfer or acquisition within the municipality of cigarettes or other tobacco products in violation of or without complying with the provisions of this chapter;
4.
Transport untaxed cigarettes or untaxed other tobacco products in the municipality in violation of or without complying with the provisions of this chapter;
5.
Sell, or offer for sale, cigarettes or other tobacco products from a mobile vehicle, cart, catering truck, or any other type of receptacle other than a vending machine, that is not appurtenant to a fixed location within the municipality;
6.
Transact a cash sale of exempt cigarettes or exempt other tobacco products within the municipality, except for sales to authorized military personnel;
7.
Possess cigarettes or other tobacco products for the purpose of resale without complete and accurate records of the acquisition of such product, including, but not necessarily limited to name of person acquired from, date of acquisition, purchase price, whether or not tax levied by this chapter has been paid, and method of payment for such product. Such cigarettes and other tobacco products are subject to immediate seizure, by the department or a peace officer; or
8.
Refuse the department's demand to produce records and documents required by this chapter to be maintained, preserved, and available for inspection by the department.
B.
An other tobacco products retailer shall not:
1.
Acquire other tobacco products for the purpose of resale from a source outside the municipality;
2.
Acquire other tobacco products for the purpose of resale from a source other than a person licensed under this chapter as a manufacturer, or other tobacco products distributor;
3.
Sell, or offer for sale, other tobacco products to a business or merchant, including, but not limited to, an other tobacco products retailer as defined by this chapter;
4.
Sell, or offer for sale, other tobacco products upon which taxes levied by this chapter have not been paid; or
C.
A cigarette retailer shall not:
1.
Acquire cigarettes for the purpose of resale from a source outside the municipality;
2.
Acquire cigarettes for the purpose of resale from a source other than a person whose place of business is in the municipality and who is licensed under this chapter as a manufacturer or cigarette distributor;
3.
Sell, or offer for sale, cigarettes to a business or merchant, including, but not limited to, a cigarette retailer as defined by this chapter;
4.
Sell, or offer for sale, cigarettes upon which taxes levied by this chapter have not been paid; or
D.
A cigarette distributor or other tobacco products distributor shall not sell cigarettes or other tobacco products exempt from the tax under this chapter without first confirming that the customer requesting exemption is registered with the department.
(AO No. 2013-125, § 1, 1-1-2014; AO No. 2019-90(S), § 8, 8-20-2019)
A.
A penalty of six percent of the taxes due shall be incurred automatically when a person fails to pay the full amount of the tax due under this chapter within seven calendar days following its due date. An additional penalty of six percent of the taxes due shall be incurred automatically when a person fails to file a tax return or report within seven calendar days following its due date under this chapter. If a person fails to pay the full amount of the tax due and/or file a tax return or report required under this chapter within 16 calendar days after its due date, the six percent penalties incurred above shall be increased automatically to 15 percent.
1.
The penalty shall be computed on the unpaid balance of the tax liability as determined by the department.
2.
Notice of the penalties incurred and to be incurred shall be given to the person responsible for payment of the taxes or for filing the return or report when such tax payment or return or report is delinquent for seven calendar days after its due date.
3.
The penalties provided for in this section shall be in addition to all other penalties and interest provided for under this chapter.
B.
If a properly filed, amended return reduces the total tax liability or the tax required to be paid, or the department reduces the tax liability, any related penalty shall be reduced accordingly.
C.
Unless otherwise provided in this section, any person who violates or fails to comply with the provisions of this chapter shall be personally liable for all costs, interest, penalties and taxes due under this chapter plus a penalty equal to 30 percent of the tax due. For good cause shown, the chief fiscal officer may waive or reduce all or part of any penalty imposed under this subsection.
D.
Except for a licensee who fails to file a tax return and remit taxes when due, but does so within 16 calendar days thereafter, a person who fails to remit taxes due under any provision of this chapter is subject to criminal prosecution pursuant to section 8.15.060 and/or section 8.15.080 and to the penalties therein.
E.
If the department finds that a person registered, or formerly registered, for exemption under section 12.40.028 has committed civil fraud, as defined in this chapter, such person may be required to remit to the municipality, an amount that equals the taxes that would have been paid to the municipality if all the cigarettes and other tobacco products acquired exempt of the tax under this chapter by such person had been fully taxed.
F.
Each instance of violation of any provision of this chapter shall constitute a separate offense.
G.
A person who violates any provision of section 12.40.125 shall be subject to a civil fine of up to $5,000.00 for each such violation.
H.
Any cigarettes and other tobacco products in the municipality that are
1.
Offered for sale from a mobile location in violation of section 12.40.130A.5,
2.
Offered for sale by an unlicensed person,
3.
Acquired in violation of this chapter, or
4.
In a person's possession in violation of this chapter,
Are subject to immediate detention and seizure by the chief fiscal officer or a peace officer. Seized cigarettes and other tobacco products are subject to forfeiture in a manner provided by law.
I.
Civil and criminal penalties and remedies shall be cumulative remedies and shall not relieve a person of the duties imposed under this chapter.
(AO No. 2013-125, § 1, 1-1-2014; AO No. 2014-42, § 43, 6-21-2014)
A.
Non-tax-paid cigarettes or other tobacco products found any place within the Municipality are contraband and may be seized by the department or a peace officer.
B.
If the department determines that the person in possession of the non-tax-paid cigarettes or other tobacco products did not intend to violate this chapter, then the department may, at its discretion, return the seized cigarettes and other tobacco products to the person from whom they were confiscated if the person pays the tax and any applicable penalties and interest due under this chapter on the confiscated cigarettes and other tobacco products.
C.
Non-tax-paid cigarettes and other tobacco products that have been seized by the department or a peace officer are subject to forfeiture to the municipality in a manner provided by law which shall include, at a minimum, notice of the forfeiture proceeding and an opportunity to request a hearing. If a hearing is not requested within the time allowed, or at the conclusion of a hearing conducted as provided in section 12.40.170 it is determined that the seized cigarettes or other tobacco products shall be forfeited to the municipality, the chief fiscal officer shall cause to be destroyed the cigarettes and other tobacco products so forfeited.
(AO No. 2013-125, § 1, 1-1-2014)
A.
A civil fraud penalty may be assessed against a person in addition to a penalty for failure to file or failure to pay.
B.
If it is determined by the department that a tax deficiency or part of a tax deficiency is due to fraud, then a penalty shall be assessed against the person committing the fraud. If more than one person is found culpable for the fraudulent act(s) or omission(s), each person shall be jointly and severally liable for the penalty under this section. The penalty is 200 percent of the deficiency due or $500.00, whichever is greater. The penalty is computed on the total amount of the deficiency due.
C.
Fraud is the intentional misrepresentation of a material fact with the intent to evade payment of tax which the person believed to be owing. The person must have had knowledge of its falsity and intended that it be acted upon or accepted as the truth. The department must prove fraud by a preponderance of the evidence.
D.
An intent to evade tax may be demonstrated by any relevant evidence, including but not limited to the following:
1.
The person provided false explanations regarding understated or omitted acquisitions of cigarettes or other tobacco products;
2.
The person provided falsified or incomplete source documents;
3.
The person has not justified an omission or understatement of a significant amount of acquisitions of cigarettes or other tobacco products;
4.
The person substantially overstated a deduction and has failed to justify the overstatement; or
5.
The person knowingly provided false statements, falsified documents, or falsified evidence to acquire a significant amount of cigarettes or other tobacco products in a manner that results in the evasion of payment for taxes due under this chapter.
(AO No. 2013-125, § 1, 1-1-2014)
A.
If any person who is liable to pay a tax or license fee under this chapter neglects or refuses to pay the tax or licensee fee after demand, the amount, including interest, additional amounts, or assessable penalty together with costs, is a lien in favor of the municipality upon all property and rights to property, real or personal, belonging to that person, and upon any other real and personal property used with the permission of the owner to carry on the business which is subject to the delinquent tax.
B.
The lien imposed by this section arises upon delinquency and continues until the amount is paid or a judgment against the person arising out of the liability is satisfied.
C.
A lien arising out of a tax due under this chapter, including the penalties and interest on the tax, and duly recorded is prior, paramount and superior to all other liens except:
1.
Liens for property taxes and special assessments;
2.
Liens that were perfected before the recording of the tax lien for amounts actually advanced before the recording of the tax lien authorized by this section;
4.
Liens of the state or the United States that are provided paramount status by law.
(AO No. 2013-125, § 1, 1-1-2014)
In addition to any penalties imposed by this chapter, interest at the rate of 12 percent per annum shall be charged on the unpaid balance of delinquent taxes.
(AO No. 2013-125, § 1, 1-1-2014)
Taxes, interest, penalties, and administration costs due under this chapter and unpaid may be collected by a civil action for the collection of a debt, by foreclosure of the tax lien in accordance with section 12.40.150.
(AO No. 2013-125, § 1, 1-1-2014)
A.
Any person aggrieved by any action of the department in issuing, suspending, revoking or refusing to issue any license or registration for exemption under this chapter or in fixing the amount of taxes, penalties, interest or costs under this chapter may apply to the department and request a hearing within 30 days from the date the department mails the notice of the department's action. Upon timely application, the chief fiscal officer shall hold a hearing pursuant to Chapter 3.60 to determine whether a correction or reversal is warranted. Hearings before the chief fiscal officer under this subsection may, at the option of the chief fiscal officer, be conducted by an administrative hearing officer designated by the chief fiscal officer. If the chief fiscal officer elects to refer the matter to an administrative hearing officer, the hearing officer shall conduct the hearing and prepare findings and conclusions. These findings and conclusions shall be forwarded to the chief fiscal officer for adoption, rejection or modification and issuance of a final order or decision by the chief fiscal officer. If the chief fiscal officer modifies or rejects the proposed findings and conclusions, the reasons for doing so shall be provided in writing. An application for a hearing must notify the department of the specific action complained of and amount of tax, interest, cost or penalty contested and the reason it is contested. Within 30 days after receipt of a written decision by the department, a person may appeal to the Superior Court of the Third Judicial District in accordance with the court rules of appellate procedure.
B.
A request for appeal is filed on the date it is personally delivered, or, if delivered to the department by United States mail, the date of the postmark stamped on the properly addressed cover in which the request is mailed. If the due date falls on a Saturday, Sunday or holiday, the due date is the next working day. A current mailing address shall be provided to the department with the request for appeal, and any change in mailing address after the request for appeal is filed shall be reported to the department.
C.
If the notice to the person pursuant to subsection A of this section shows an amount due the department, the uncontested portion of the amount due must be paid within 30 days after the date of the notice. If the uncontested amount is not paid within 30 days, collection action will be taken on that amount even if the person has filed a request for appeal. Payment of the total amount due may be made at any time before the hearing. If the department has reason to believe that collection of the total amount due might be jeopardized by delay, immediate payment of the total amount will be demanded and the department may pursue any collection remedies provided by law. Payment in full does not affect the person's right to a hearing.
D.
If a person requests a hearing and fails to appear at the hearing, the chief fiscal officer or hearing officer may issue a decision without taking evidence from that person, unless that person shows reasonable cause for failure to appear within seven days after the date scheduled for the hearing.
E.
Taxes, license fees, penalties, interest, and costs declared to be due in the final administrative decision must be paid within 30 days after the date of the decision, or a bond must be filed with the court in accordance with Alaska Rules of Appellate Procedures.
(AO No. 2013-125, § 1, 1-1-2014)
No later than the end of each calendar month, a manufacturer shall submit a report to the department stating:
A.
A list of the tobacco products, the quantity and their wholesale price, and the number of cigarettes, which were brought into the municipality from the manufacturer, or manufactured by the manufacturer in the municipality during the preceding month;
B.
The names and address of those persons bringing cigarettes and tobacco products into the municipality from the manufacturer during the preceding month; and
(AO No. 2013-125, § 1, 1-1-2014)
A.
Except for a person registered under section 12.40.028, every person subject to this chapter shall keep a complete and accurate record of all cigarettes and other tobacco products manufactured, purchased, sold, brought into, transported outside of, or acquired in the municipality by such person.
1.
Except in the case of a manufacturer, the records shall include a statement containing the name and address of the person from whom cigarettes or other tobacco products were purchased or acquired, the date of delivery, the quantity of cigarettes and other tobacco products, the trade name and brand of each, whether or not the cigarettes and other tobacco products were acquired with the tax imposed by this chapter previously paid by another person, and the price paid for the cigarettes and other tobacco products purchased. Each acquisition of cigarettes and other tobacco products shall be supported by an invoice or sales receipt issued by the person from whom the cigarettes and other tobacco products were acquired.
2.
Each sale of cigarettes or other tobacco products within the municipality shall be recorded by the licensee and the record shall include, at minimum: a statement whether or not the product sold is subject to the tax under this chapter or is tax-exempt, the date of sale, the type of tobacco sold, the quantity of cigarettes sold, the sales price, and the amount and method of payment received. A comparable receipt of sale shall be provided to each purchaser at the time of purchase.
a.
A manufacturer, bonded distributor, cigarette distributor, and other tobacco products distributor shall also record the business identity and, if applicable, the registration number issued under section 12.40.028, or the license number issued under section 12.40.035, of every merchant customer purchasing cigarettes or other tobacco products and shall include such identity on the sales receipt to the merchant customer.
b.
A licensee transferring or selling cigarettes or other tobacco products to a person registered under section 12.40.028 shall be able to provide to the department, upon request, a report summarizing all cigarettes and other tobacco products transferred or sold to such person during a specified time period as permitted by this section.
c.
A licensee transferring or selling cigarettes or other tobacco products to a person licensed under section 12.40.035 shall be able to provide to the department, upon request, a report summarizing all cigarettes and other tobacco products transferred or sold to such person during a specified time period as permitted by this section.
B.
Every person registered under section 12.40.028 shall keep complete and accurate documentation and records of:
1.
All cigarettes and other tobacco products in the municipality purchased by such person exempt of the tax levied by this chapter, including at a minimum: invoices issued by distributors in the municipality; identification of manufacturer, brand, quantity, purchase price, and date of purchase of cigarettes and other tobacco products acquired; identification of delivery method and date of delivery for products purchased; the delivery address of the products purchased; and the signatures of person delivering and person receiving products purchased.
2.
All sales of cigarettes and other tobacco products by such person, to include at a minimum: the date of sale, the type of tobacco product sold, the quantity of cigarettes sold, the sales price, the amount and method of payment received, and the business name and address of all merchant customers acquiring cigarettes and other tobacco products.
C.
Persons subject to this chapter shall keep such other documents and records as the department prescribes.
D.
All documents and records required by this section shall be preserved by persons subject to this chapter for three years. All records and documents required by this chapter to be kept or retained are subject to inspection within the municipality upon demand by the department.
E.
During normal business hours, the chief fiscal officer or a designee may, upon presentation of proper identification, inspect the records which a person subject to this chapter is required to maintain under this section or inspect the records of a person whom the chief fiscal officer has a reasonable suspicion to believe is a person subject to this chapter to determine whether that person is subject to this chapter.
1.
Upon notice of the department's intent to inspect records, a person subject to this chapter shall retain such records and preserve their availability to the department until released by the department in writing, regardless of whether such retention and preservation continues beyond the three-year period specified in this section.
2.
The chief fiscal officer's authority to inspect records shall not be limited to records within the three calendar year retention period. If a person subject to this chapter has possession or control of records described in this section that are older than the three-year period specified in this section, the person subject to this chapter shall make such records available for inspection upon request.
F.
Unless documents, records, and other credible evidence establish otherwise, it shall be presumed that all cigarettes or other tobacco products manufactured in the municipality by a licensee or first acquired in the municipality by a licensee that are no longer in possession of that licensee, have been sold in the municipality by that licensee.
G.
The chief fiscal officer may, during normal business hours, enter the business premises or other location of a licensee where cigarettes or other tobacco products are kept or stored, so far as it may be necessary for the purpose of examining such products and the related business records.
(AO No. 2013-125, § 1, 1-1-2014)
The chief fiscal officer, or designee, may adopt regulations providing for the application and interpretation of this chapter and providing methods and forms for reporting and collecting the tax imposed by this chapter.
(AO No. 2013-125, § 1, 1-1-2014)
A.
Unless ordered released by court order, All tax returns, documents, records and/or reports filed with the municipality pursuant to the provisions of this chapter and all data obtained from such tax returns, documents, records and/or reports are confidential and may not be released for inspection by any person except the mayor, chief fiscal officer, municipal attorney, internal auditor, or the assembly, provided that the confidential nature of the records is retained and protected.
B.
It is the duty of the chief fiscal officer to safely keep tax returns, documents, records and reports and all data taken therefrom secure from public and private inspection except as provided by this chapter.
C.
This section does not prohibit the municipality from compiling and publishing statistical evidence concerning the data submitted provided that no identification of particular tax returns, documents, records and/or reports is made. Nothing in this section shall be deemed to prohibit the internal auditor from examining the tax returns, documents, records and/or reports in accordance with sections 3.20.100 through 3.20.130 provided that no information obtained from specific or identifiable tax returns shall be made available to persons other than those authorized to review them under subsection A of this section.
D.
This section does not prohibit the chief fiscal officer from sharing information obtained from tax returns, documents, records, and/or reports filed with the municipality pursuant to this chapter with any local, state, or federal government agency for the purpose of enforcing this chapter.
(AO No. 2013-125, § 1, 1-1-2014)