Bill No.
15-15
Concerning:
Taxes - Excise Tax -
Electronic Cigarettes
Revised:
5/10/2015
Draft No.
3
Introduced:
April
14. 2015
Enacted:
May
13. 2015
Executive: - - - - - - - - -
Effective: - - - - - - - - - - .
Sunset Date: _......N.::.!on""'e<--------
Ch. _ _ , Laws of Mont. Co. _ __
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
Lead Sponsor: Councilmember Hucker
Co-Sponsors: Council President Leventhal, Councilmembers Berliner and Riemer, Vice President
Floreen, and Councilmembers Katz, Eirich, Navarro and Rice
AN ACT
to:
(1)
(2)
(3)
(4)
(5)
establish an excise tax on the distribution of electronic cigarette products;
set the rate of the tax and authorize the County Council to change the rate each year
by resolution;
define certain tenns, and authorize the County Executive to issue certain regulations;
provide for collection of the tax and payment of interest and penalties, set the
effective date of the tax, and apply certain provisions of law to this tax; and
generally amend the County laws governing excise taxation.
By adding
Montgomery County Code
Chapter 52, Taxation
Article XIII. Excise Tax on Electronic Cigarettes
Sections 52-95, 52-96, 52-97, 52-98, 52-99 and 52-100
Boldface
Underlining
[Single boldface brackets]
Double underlining
[[Double boldface brackets]]
* * *
Heading or defined term.
Added to existing law
by
original bill.
Deletedfrom existing law by original bill.
Added by amendment.
Deleted.from existing law or the bill by amendment
Existing law unaffected by bill.
The County Council for Montgomery County, Maryland approves the following Act:
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BILL
No. 15-15
1
Sec.
1.
Chapter 52 is amended
by
adding Article XIII (Sections 52-95, 52-
96, 52-97, 52-98, 52-99, and 52-100) as follows:
Article XIII. [Reserved] Excise Tax
!!!!
Electronic Cigarettes.
52-95. Definitions.
In
this Article, the following terms have the meanings indicated:
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Dealer
means any person who engages
in~
retail business.
Director
means the Director of Finance or the Director's designee.
Distributor
means:
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ill
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person who supplies an electronic cigarette product to
~
dealer in the
1O
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County; or
ill
~
person who supplies and services
~
vending machine with an
electronic cigarette product.
Electronic cigarette product
means any product containing or delivering
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nicotine or any other substance intended for human consumption that can be
used
.Qy
~
person to simulate smoking through inhalation of vapor or aerosol
from the product. The term includes any such device, whether manufactured,
distributed, marketed, or sold as an e-cigarette, e-cigar, e-pipe, e-hookah, or
vape pen, or under any other product name or descriptor.
Electronic cigarette
product
includes any [[refill, cartridge, or any other component of an
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electronic cigarette]] component. part. or accessorv of an electronic cigarette.
whether or not sold separately. that is used during the operation of the
electronic cigarette. but does not include any batterv or batterv charger that is
sold separately.
Supplying
or
supplies
means the act of providing, furnishing, delivering,
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distributing, or transmitting an electronic cigarette product
.Qy
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distributor to
~
dealer in the County. Liability for the
tax
accrues when the electronic cigarette
product is provided, distributed, or delivered to the dealer in the County.
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BILL
No.
15-15
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52-96. Tax levied; rate.
ill)
A
tax
is levied and imposed on every distributor who supplies to g
dealer
in
the County an electronic cigarette product.
.{hl
The tax rate for an electronic cigarette product is 30% of the wholesale
price of the electronic cigarette product.
.(£}
The County Council
.Qy
resolution, after g public hearing advertised
under Section 52-17(c), may increase or decrease the rate set in
subsection
[[(fil)]
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£b1
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@
The County Executive may further specify the administration of this tax
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Method
ill
regulation.
52-97. Remittance.
ill)
The tax levied under Section 52-96 is due and payable for each month
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.{hl
The Director may establish an alternative payment system.
If an
alternative payment system is established the Director must require g
pro-rated payment for any taxable period that ends before the system
takes effect.
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.(£}
If
any dealer transports or causes to be transported into the County an
electronic cigarette product, that dealer is liable for the payment of the
tax imposed under Section 52-96 unless that dealer obtains from the
supplier of the electronic cigarette product g written certification, in g
form approved
.Qy
the Director, that the supplier is liable for and is
paying the tax.
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52-98. Cessation of business.
When g person who is required to
pgy
g tax under this Article ceases to do
business or otherwise disposes of the business, any tax owed becomes immediately
due and payable. That person must immediately remit the. total amount of the
tax
due.
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BILL
No. 15-15
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52-99. Collection; interest and penalties; violation.
.(ru
If
any person does not
oo
the Director the tax due under Section 52-96,
that person is liable for:
ill
ill
interest on the unpaid tax at the rate of 1
%
per month for each
month or part
of~
month after the tax is due; and
~
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penalty of 5% of the amount of the tax per month or part
of~
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month after·the tax is due, not to exceed 25% of the tax.
The Director must collect any interest and penalty as part of the tax.
Qi}
[Uf
any person does not
oo
the tax when due, the Director must obtain
information on which to calculate the tax
d~e.
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As soon as the Director
obtains sufficient information on which to calculate any tax due, the
Director must assess the tax and penalties against the person.
The
Director must notify the person of the total amount of the tax, interest,
and penalties
!2y
mail sent to the person's last known address. This
notice is prima facie evidence of the tax due; entitles the County to
judgment for the amount of the tax, penalty, and interest listed in the
notice; and gives the taxpayer the burden of proving that the tax has
been paid or any other sufficient defense to the action. The total amount
due must be paid
within
10 days after the date of the notice.
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.{£}]]
If
any person does not timely file any report and
oo
the tax required
under this Section, the Director may use any available information to
estimate the tax due. As soon as the 'Director obtains available
information on which to base the calculation of any tax payable
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any
person who has not timely filed any report and paid the tax, the Director
may assess against that person any tax, interest, and penalties due and
must notify that person of the total amount due
!2y
regular mail sent to
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BILL
No.15-15
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the person's last known address. The total amount assessed is due and
payable within 10 days after the notice is sent.
[[@]]
W
Every person liable for any tax under Section 52-96 must preserve
for
1
years suitable records necessary to determine the amount of the
tax. The Director may inspect and audit the records at any reasonable
time.
[[W]]
(ill
Any failure to
oo
the tax when due under Section 52-97, and any
is~
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violation of this Section 52-97 or this Section,
Class A violation.
Each violation
is~
separate offense. A conviction under this subsection
does not relieve any person from paying the tax.
[[{D.]]
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£ru
Section 52-18D applies to this tax.
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52-100.Jleserved.
Approved:
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George Leventhal, President, County Council
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Date
Approved:
Isiah Leggett, County Executive
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Date
This is a correct copy ofCouncil action.
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Linda M. Lauer, Clerk of the Council
Date
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