Cigarette and Tobacco Products Distributor

Cigarettes

A cigarette is any roll of any size or shape for smoking that:

• Is made of any amount of tobacco regardless of whether it is flavored, adulterated, or mixed with any other ingredient,
• Has a wrapper or cover made of paper or any other material, and
• Weighs three pounds per thousand sticks or less.

A roll with a wrapper that is mainly made of tobacco and weighs more than three pounds per thousand sticks is considered a tobacco product rather than a cigarette.

Tobacco products

Tobacco products include, but are not limited to:

• Smoking or pipe tobacco (including shisha)
• Chewing tobacco
• Snuff
• Cigars
• Little cigars
• Any product containing, made of, or derived from any amount of tobacco that is intended for human consumption
• Any product containing, made of, or derived from any amount of nicotine that is intended for human consumption

  Examples include:

  • Any product containing synthetic nicotine that is intended for human consumption
  • Any product containing nicotine derived from plants such as tobacco, eggplant, potatoes, or synthetically created, that is intended for human consumption
• Electronic cigarettes or any device or delivery system sold in combination with nicotine or any liquid or substance containing nicotine in their original manufacturer packaging as one unit or sold for a single price before or when the liquid or substance containing nicotine is distributed
• Any component, part, or accessory of an electronic cigarette that is used during the operation of the device when sold in combination with nicotine or any liquid or substance containing nicotine in their original manufacturer packaging as one unit or sold for a single price before or when the liquid or substance containing nicotine is distributed (for example, a battery used in the operation of the device sold with nicotine for a single price)

Notes

1. Tobacco products do not include cigarettes. Tobacco products do not include any product that has been approved by the United States Food and Drug Administration for sale as a tobacco cessation product or for other therapeutic purposes (for example, nicotine patches) when that product is marketed and sold solely for such approved use. Effective April 1, 2017, Proposition 56 (passed November 2016) amended the definition of “tobacco products” under the California Cigarette and Tobacco Products Tax Law (Revenue and Taxation Code [RTC] section 30121). Prior to April 1, 2017:
   • Little cigars were considered cigarettes for taxation purposes and required a cigarette tax stamp
   • Tobacco products (other than cigars, smoking or chewing tobacco, or snuff) had to contain at least 50 percent tobacco
   • Any products containing, made of, or derived from nicotine and not containing 50 percent or more of tobacco were not necessarily tobacco products
   • Electronic cigarettes sold with nicotine and vape liquids containing nicotine were not tobacco products
   • Any component, part, or accessory of an electronic cigarette when sold with nicotine were not tobacco products
2. Nicotine does not include any food products as defined in RTC section 6359.
3. Electronic cigarettes do not include delivery devices (for example, eCigarettes or vape pens) sold individually or with a liquid or substance containing 0mg nicotine and are not considered tobacco products for taxation purposes; however, they are subject to retail licensing (visit STAKE Act Definition of Tobacco Products for Retailer Licensing Purposes in the Retailer guide).

The cigarette and tobacco products excise taxes are paid by a distributor upon the distribution of cigarettes and tobacco products in California. A person may not be both a distributor and a wholesaler. A distribution includes the sale, use or consumption of untaxed cigarettes or untaxed tobacco products in California, and the placing of untaxed cigarettes or untaxed tobacco products into a vending machine or retail stock in California. If you are engaged in business in California and selling or accepting orders for cigarettes or tobacco products, you are required to be licensed under the Licensing Act. You must have a distributor’s license before you purchase any untaxed cigarettes or tobacco products.

Cigarette distributor

A cigarette distributor:

• Buys cigarettes that do not yet have California tax stamps.
• Pays the required tax by purchasing California tax stamps from us.
• Must place a California tax stamp on each cigarette pack before distributing it in this state.
• Can sell the stamped cigarettes to wholesalers, other distributors, or retailers that hold a valid CDTFA cigarette and tobacco products license.
• Must register with us as a cigarette distributor.
• Are not allowed to hold a wholesaler’s license.

Tobacco products distributor

A tobacco products distributor:

• Is a person who distributes tobacco products in California.
• Generally purchases tobacco products before any California tobacco products tax is due and then pays the tax when the products are distributed in California.
• Must register with us as a tobacco products distributor if distributing in California.
• Must calculate the tobacco products tax based on the wholesale cost of the products distributed and pay the total amount owed each month with their tax return.
• May sell only to distributors, wholesalers, or retailers that hold a valid CDTFA cigarette and tobacco products license.
• May not hold a wholesaler’s license.

Please note: Throughout this guide, we may use the term Native American to represent American Indian and Indian as these terms are used in the state and federal law.