Getting Started with Cigarettes and Tobacco Products

Licenses Required

Cigarette and Tobacco Products Licensing Act of 2003

The Cigarette and Tobacco Products Licensing Act of 2003 (Licensing Act) requires us to administer a statewide program to license all people engaged in the sale of cigarettes and tobacco products in California: manufacturers, importers, distributors, wholesalers, and retailers. These people are required to obtain and maintain a license to sell cigarettes or tobacco products in California. Distributors, wholesalers, and retailers must obtain a separate license for each location where they will sell cigarettes or tobacco products. They may purchase/sell cigarettes and tobacco products only from or to other licensed entities along the supply chain.

California voters approved Proposition 99 (effective January 1989), the Tobacco Tax and Health Protection Act of 1988, which increased the cigarette tax rate and added an equivalent tax on other tobacco products. As a result, tobacco products distributors are also required to hold a license under the Cigarette and Tobacco Products Tax Law for tax reporting and paying. In addition, cigarette and tobacco products wholesalers are required to hold a license under the Cigarette and Tobacco Products Tax Law for information reporting purposes.

Licenses issued under the Licensing Act and the Cigarette and Tobacco Products Tax Law are required in addition to a seller's permit for sales tax or other licenses that may be required. Depending on your business operations, you may be required to obtain more than just a California cigarette and tobacco products license. Before registering for a Cigarette and Tobacco Products Retailer's License, you should check with your local health department, cities, and counties for any local tobacco licensing requirements, which may be more restrictive. Visit the CalGold website for help with permit and licensing requirements by local authorities and other state or federal authorities.

Please note: Cigarettes and tobacco products may not be sold at a location that is licensed as a cannabis business (Business and Professions Code [B&PC] section 26054(a)).

California Healthy Outcomes and Prevention Education (HOPE) Act

Beginning July 1, 2022, retailers (in-state or out-of-state) of eCigarettes are required to collect from the purchaser (California consumer) at the time of sale, the California Electronic Cigarette Excise Tax (CECET) at the rate of 12.5 percent (12.50%) of the retail selling price of eCigarettes containing or sold with nicotine. The collection of the CECET is in addition to the sales and use tax.

A retailer of eCigarettes containing or sold with nicotine must:

• Be registered with us for a CECET permit (account),
• Include the CECET amount in any price marketing on any sign or display,
• Collect the CECET from the purchaser at the rate of 12.5 percent (12.50%) of the retail selling price of eCigarettes containing or sold with nicotine at the time of sale,
• Provide the purchaser with a receipt or other document that separately states the CECET and the amount they paid on each electronic cigarette retail sale,
• File a CECET return electronically, and
• Pay the tax to us.

For more information, see our Tax Guide for California Electronic Cigarette Excise Tax.

A Retailer's License is Still Required to Sell Non-Nicotine Tobacco Products

Any retailer that sells tobacco products as defined under the STAKE Act, such as 0mg nicotine vape liquids or electronic cigarettes sold without nicotine, is required to hold a Cigarette and Tobacco Products Retailer's License from us in order to engage in the retail sale of these products.

This retailer licensing requirement does not apply to cannabis or cannabis products. See our Overview section, under STAKE Act Definition of Tobacco Products for Retailer Licensing Purposes.

Below is a chart to help you understand if a cigarette and tobacco products retailer license is required.

More Than One Type of License May Be Required

You may need a seller's permit as well as multiple cigarette and tobacco products licenses. For example:

• If you are a distributor that intends to sell directly to consumers, you will need:
  • A seller's permit,
  • A distributor's license, and
  • A retailer's license.
• If you are a manufacturer/importer that intends to sell to wholesalers and retailers, you will need:
  • A seller's permit
  • A manufacturer/importer's license, and
  • A distributor's license.
• If you are a wholesaler that intends to sell directly to consumers, you will need:
  • A seller's permit,
  • A wholesaler's license, and
  • A retailer's license.
• In addition to the above, if you intend to sell electronic cigarettes containing or sold with nicotine to consumers, you will also need a CECET permit (account). For more information, see our Tax Guide for California Electronic Cigarette Excise Tax.

Please note: you must have a distributor's license before you purchase any untaxed cigarettes or tobacco products. A person may hold a distributor's license or wholesaler's license, but not both. The Cigarette and Tobacco Products Tax Law license may often be referred to as your “tax account” or “tax reporting account”, which is for reporting requirements, such as filing tax returns, reports, and schedules.

Notes

1. If you sell, transfer, or ship for-profit cigarettes, roll-your-own/smokeless tobacco, or ENDS into California, see the PACT Act under the PACT Act & Consumer section. There are additional requirements under Federal Law, the Jenkins Act, 15 U.S.C. sections 375-378, amended by the PACT Act, and the 2021 Omnibus Appropriations Bill HR 133 section 601).
2. For registration requirements for sales and use tax, please review our guide, Use Tax Collection Requirements Based on Sales into California Due to the Wayfair Decision.
3. The California Cigarette and Tobacco Products Licensing Act of 2003 does not affect any laws or regulations regarding cannabis or cannabis products such as vape devices, pens, or accessories that are intended and designed for use in consuming cannabis or cannabis products into the human body. Cigarettes and tobacco products may not be sold at a location that is licensed as a cannabis business.
4. These licenses are not allowed if licensee is a distributor. A Wholesaler's license may not be issued to an out-of-state person selling at an out-of-state location.
5. These licenses are not allowed if licensee is a wholesaler.
6. A California Electronic Cigarette Excise Tax (CECET) permit (account) is required if you sell electronic cigarettes containing or sold with nicotine to consumers. For more information, see the Tax Guide for California Electronic Cigarette Excise Tax.

Registration

Online Registration – Register with us online for your cigarette and tobacco products license, a seller's permit, and any other permits, licenses, or accounts.

Online registration is the convenient way to register and is available 24 hours a day. Upon registration, you will be required to pay the applicable license fees.

Security/Bond Requirement

If you are applying for a distributor's license, you will be required to post a minimum $1,000 security deposit before the license can be issued (Revenue and Taxation Code section 30141 and 30142; Regulation 4018.

There are no security deposit requirements for a retailer's, wholesaler's, or manufacturer's/importer's license.

License Renewals

All licensees registered under the California Cigarette and Tobacco Products Licensing Act of 2003 must renew/maintain their license(s) annually. A license is not assignable or transferable.

Remember, you may not sell cigarettes and/or tobacco products at any location without a valid cigarette and tobacco products license for that location. For more information about online license renewals, please see our frequently asked questions.

License Periods

Retailers

A retailer's license is valid for a 12-month period. A retailer that adds an additional retail location will renew the retailer's license for that retail location based on a 12-month period beginning in the month that the retailer's license for the first retail location was obtained.

Wholesalers and Distributors

A wholesaler or distributor's license is valid for one calendar year (January through December).

Manufacturers and Importers

Manufacturers and importers must maintain their license and affirm certain certifications annually (Business and Taxation Code section 22979).

Renewal Reminders

Approximately 60 days prior to your license expiring, we will send you an email and paper notice reminding you to renew your license and will send you another reminder email notice approximately 30 days prior to your license expiring. It is important to renew your license before it expires, as you must have a valid license for each location in order to purchase or sell cigarettes and/or tobacco products at each location.

How to Renew

Renew your license by logging on to our online services system with your username and password. If you do not have a username and password, you must create one using our Sign Up Now process. If you need assistance with creating a username and password, watch our video tutorials. Our online services system is free to use. The only cost is your license(s) renewal fee.

License Renewal Fee

Cigarette and tobacco products distributors, wholesalers, and retailers must pay an annual fee per location to renew their license. Cigarette and tobacco products manufacturers and importers pay a one-time administration/license fee. License fees are not prorated.

Tax Rates and License Fees

Visit the tax rate page to view current and historical cigarette and tobacco products tax rates and license fees for retailers, wholesalers, distributors, manufacturers, and importers.

On our tax rate page, you may find licensing fees under the heading Cigarette and Tobacco Products Licensing Act and tax rates under Cigarette and Tobacco Products Tax.

Filing, Payments, and Account Maintenance

Filing Deadlines – Find your filing due dates.

• Due Date: Unless otherwise specified, all tax returns and reports must be filed, and payments must be made on or before the 25th day of the calendar month following the reporting period.
• For example: a return or report for the monthly reporting period of April 2024 would be due on or before May 25, 2024, along with the total payment amount due.

File Online – You are required to file your tax forms online with us. Listed below are useful online filing resources.

• Cigarette and Tobacco Products Online Filing
• Online Filing Templates
• Online Filing Instructions for Cigarette and Tobacco Products Tax
• Video Tutorials
• Cigarette and Tobacco Products Flat (FLT) File and XML Filing Guide

You must file all applicable cigarette and tobacco products tax returns, reports, and schedules even if you made no transactions or deliveries during the reporting period. You may be required to file other returns or reports with us. You must keep and maintain complete and legible purchase and sales records for four years. You must keep and maintain the purchase and sales records at each licensed location for at least one year after the date of the purchase, unless we have approved another location.

Online Payment Options – Make payments online.

Taxpayer Online Service Portal – Update your business information and keep your accounts current by logging in to our online services system using your username and password and select the account for which you want to update. Select the More link under the I Want To section. Then select the option you are requesting to update under Account Maintenance.

Tax Forms

Cigarette Distributors/Importers

• CDTFA-501-CD, Cigarette Distributor/Importer Tax Report
  • CDTFA-810-CTI, Cigarette Tax Receipt Schedule
  • CDTFA-810-CTF, Cigarette Tax Disbursement Schedule
    • CDTFA-810-CTE, Instructions for Preparing Cigarette Tax Schedules

Cigarette Distributors

• CDTFA-413-ACTS, Cigarette Distributor's Report of Returned Stamps

Tobacco Products Distributors

• CDTFA-501-CT, Tobacco Products Distributor Tax Return
  • Schedule T
  • CDTFA-810-CTN, Electronic Cigarettes and Vaping Products that Contain Nicotine Tax Disbursement Schedule

Cigarette Wholesalers

Under Revenue and Taxation Code section 30188, every licensed cigarette wholesaler in this state is required to file a report showing their cigarette inventory activity.

• CDTFA-501-CW, Cigarette Wholesaler's Report
  • CDTFA-810-CTI, Cigarette Tax Receipt Schedule
    • CDTFA-810-CTE, Instructions for Preparing Cigarette Tax Schedules

Tobacco Products Wholesalers

Licensed tobacco products wholesalers do not have a tobacco reporting requirement, but must maintain records.

Cigarette Manufacturers

• CDTFA-501-CM, Cigarette Manufacturer's Tax Return of Taxable Distributions in California
  • CDTFA-810-CTF, Cigarette Tax Disbursement Schedule
    • CDTFA-810-CTE, Instructions for Preparing Cigarette Tax Schedules

Tobacco Products Manufacturers/Importers

• CDTFA-501-TIM, Tobacco Products Manufacturer/Importer Return of Taxable Distribution of Samples in California
  • CDTFA-501-MIT, Schedule Manufacturer/Importer Report of Tobacco Products Delivered or Shipped into California

Cigarette Common Carriers

Common carriers making a delivery of cigarettes, originating outside of California, to a consignee located in California, must file a report on or before the 25th day of the calendar month following the calendar month in which the delivery of the cigarettes or tobacco products was made (Regulation 4041). The delivery report is informational only; no tax or fee is due.

• CDTFA-1071, Common Carrier's Report of Cigarette Deliveries of Interstate or Foreign Shipments of Cigarettes Destined California Points

Tobacco Products Retailers

A retailer selling electronic cigarettes containing or sold with nicotine to consumers must electronically file quarterly CECET returns using our Online Services and pay the CECET quarterly. You must file your CECET returns separately from any other reports or returns you are required to file. For more information, see the Tax Guide for California Electronic Cigarette Excise Tax.

Consumers

Cigarettes and/or Tobacco Products

A consumer is required to file returns online and pay on or before the last day of the calendar month following the end of a calendar quarter. A consumer is required to report the amount of untaxed cigarettes and/or tobacco products received in the preceding calendar quarter and pay the amount of tax due (Revenue and Taxation Code section 6451, 6452, 30008, 30107, and 30187). For example, if you purchased cigarettes and tobacco products without paying the California excise/use taxes at the time of purchase anytime between January 1, 2022 and March 31, 2022 (the first calendar quarter of the year 2022), you must file and pay the 1st quarter 2022 excise and use tax by April 30, 2022.

• A combined online return is used to report both the excise and use taxes for your cigarettes and/or tobacco products purchases. Whether you have filed a return with us in the past or if this is your first time filing, go to our Online Services page, click on File a Return, click on Cigarette & Tobacco Internet Purchases Return, and then follow the prompts to report your purchases, file a return, and pay the excise and use taxes.

If you do not file on time, you may owe a 10 percent late filing penalty on the amount of tax due and interest at our current rate. You may receive a delinquency notice and/or a compliance assessment for tax, penalty and interest based on the invoices received from the out-of-state companies complying with the Jenkins Act or other documentation available to us. You will then have 30 days to pay or dispute the liability.

Prevent All Cigarette Trafficking (PACT) Act Filers

PACT Act reports must be filed with us no later than the 10th day of each calendar month for the previous calendar month's shipments. For example, reports for the reporting month of September 2022 would be due by October 10, 2022. The reports must contain detailed information on each transaction made during the previous calendar month. Separate PACT Act monthly reports are to be filed for cigarettes, roll-your-own/smokeless tobacco, and electronic nicotine delivery systems (ENDS).

File Online — You are required to file your PACT Act Reports electronically through our online services. We have developed an Excel file template to help you file online. The Excel file template is also available after you log in to file your report online. The template may be used for filing periods August 2019 and after.

Please note: The template was updated to include ENDS effective March 27, 2021.

• CDTFA-5204-PA, California PACT Act Report Online Filing Template
  • PA-1,California Cigarette Pact Act Report
  • PA-2, California Tobacco Pact Act Report
  • PA-3, California Electronic Nicotine Delivery System (ENDS) PACT Act Report

For more information about the PACT Act, see the PACT Act under the PACT Act & Consumer section.

Updating Your Business Information

Is your account information up to date? Has your business model changed? We must have the most current information about your business to ensure you receive updates, notices, and due date reminders. Log in to our online services to update your account whenever you change your business or mailing address; add or close a business location; change your entity type, business, or legal entity name; add or remove owners, officers, members, or partners; or change your banking information.

Please note: If you change your business licensed location address, a new license number may be required.

Update your business information through our online services homepage. Log in using your username and password, and select the account you want to update. Select the More link under the I Want To section, then select the option you are requesting to update under Account Maintenance.

Additional Business Update Options — You may also notify us of any changes by:

• Using CDTFA-345-SP, Notice of Business Change, Special Taxes and Fees Accounts,
• Contacting our Customer Service Center at 1-800-400-7115 (CRS: 711) and selecting the option for Special Taxes and Fees, or
• Sending a message through our website at Email Your Tax Questions.