Bill No.
15-15
Concerning:
Taxes - Excise Tax -
Electronic Cigarettes
Revised:
5110/2015
Draft No.
3
Introduced:
April
14. 2015
Enacted:
May
13. 2015
Executive:
May
20. 2015
Effective:
August
19. 2015
Sunset Date:
__,_,N><on..,,e~------
Ch.
_1§_,
Laws of Mont. Co.
2015
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 terms, 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
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Boldface
Underlining
[Single boldface brackets]
Double underlining
[[Double boldface bracketsD
Heading or defined term.
Added to existing law by original bill.
Deletedfrom existing law by original bill.
Added by amendment.
Deletedfrom 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.
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In
this Article, the following
terms
have the meanings indicated:
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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.!!, person who supplies an electronic cigarette product to .!!, dealer in the
County; or
.!!, person who supplies and services .!!, Vending machine with an
electronic cigarette product.
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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
!2y
.!!, 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]] comoonent, 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 senarately.
Supplying
or
supplies
means the act of providing, furnishing, delivering,
distributing, or transmitting an electronic cigarette product
Qy
.!!, 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.
(fil
A tax is levied and imposed on every distributor who supplies to g
dealer in the County an electronic cigarette product.
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The tax
rate
for an electronic cigarette product is 30% of the wholesale
price of the electronic cigarette product.
(£)
The County Council
!?y
resolution. after g public hearing advertised
under Section 52-17(c), may increase or decrease the rate set in
subsection
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The County Executive may further specify the administration of this tax
!?y
Method
ill
regulation.
52-97. Remittance.
(fil
The tax levied under Section 52-96
is
due and payable for each month
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The Director may establish an alternative payment system.
If
an
alternative payment svstem 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
!?y
the Director, that the supplier is liable for and is
paving 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.
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If
any person does not
imv
the Director the tax due under Section
52-96.
that person is liable for:
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interest on the unpaid tax
at
the rate of 1
%
per month for each
month or part of
J!
month after the tax is due: and
J!
penalty of
5%
of the amount of the tax
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month or part of
J!
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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.
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.OU
[l!f
any person does not
imv
the tax when due. the Director must obtain
information on which to calculate the tax d1:1e.
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
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Director must notify the person of the total amount of the
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interest.
and penalties
ID'.
mail sent to the person's last known address. This
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notice is prima facie evidence of the tax due; entitles the County to
judgment for the amount of the
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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
l
0
days after the date of the notice.
{sill]
If
any person does not timely file any report and
imv
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
ID'.
any
person who
has
not timely filed any report and paid the
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the Director
may assess against that person any tax, interest, and penalties due and
must notify that person of the total amount due
ID'.
regular mail sent to
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BIUN0.15-15
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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.
[[@])
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Every person liable for any tax under Section 52-96 must preserve
for
J.
years suitable
records necessary to determine the amount of the
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tax. The Director may inspect and audit the records at any reasonable
time.
[[~]]@Any
failure
to~
the tax when due under Section 52-97, and any
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violation of this Section 52-97 or this Section. is
!!
Class A violation.
Each violation is
!!
separate offense. A conviction under this subsection
does not relieve any person from paying the tax.
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W
Section 52-18D applies to this tax.
52-100. Reserved.
Approved:
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George Leventhal, President, County Council
96
Date
Approved:
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98
Isiah
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This is a correct copy ofCouncil action.
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~1h. ~
Linda M. Lauer, Clerk of the Council
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