By: Johnson, et al. S.B. No. 248
A BILL TO BE ENTITLED
AN ACT
relating to the regulation of and permits for the sale or delivery
of cigarettes, tobacco products, and e-cigarettes; requiring
permits; imposing fees; providing administrative penalties.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle G, Title 2, Health and Safety Code, is
amended by adding Chapter 147 to read as follows:
CHAPTER 147. E-CIGARETTE RETAILER PERMITS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 147.0001. DEFINITIONS. In this chapter:
(1) "E-cigarette" has the meaning assigned by Section
161.081.
(2) "E-cigarette retailer" means a person who engages
in the business of selling e-cigarettes to consumers, including a
person who sells e-cigarettes to consumers through a marketplace.
(3) "Marketplace" has the meaning assigned by Section
151.0242, Tax Code.
(4) "Permit holder" means a person who obtains a
permit under Section 147.0052.
Sec. 147.0002. INAPPLICABILITY TO CERTAIN PRODUCTS. This
chapter does not apply to a product described by Section 161.0815.
Sec. 147.0003. HEARINGS. Unless otherwise provided by this
chapter, the comptroller shall conduct all hearings required by
this chapter in accordance with Chapter 2001, Government Code. The
comptroller may designate one or more representatives to conduct
the hearings and may prescribe the rules of procedure governing the
hearings.
Sec. 147.0004. RULES. The comptroller may adopt rules to
implement this chapter, including rules exempting a person who
sells e-cigarettes to consumers through a marketplace from the
requirements of this chapter.
SUBCHAPTER B. PERMITS
Sec. 147.0051. E-CIGARETTE RETAILER PERMIT REQUIRED. (a)
A person may not engage in business as an e-cigarette retailer in
this state unless the person has been issued a permit from the
comptroller. A person shall obtain a permit for each place of
business the person owns or operates at which sales of e-cigarettes
are made.
(b) The comptroller shall prescribe the form and content of
an application for a permit and provide the form on request.
(c) The applicant shall accurately complete all information
required by the application and provide the comptroller with
additional information the comptroller considers necessary.
(d) Each applicant that applies for a permit to sell
e-cigarettes from a vehicle must provide the make, model, vehicle
identification number, registration number, and any other
information concerning the vehicle the comptroller requires.
(e) All financial information provided under this section
is confidential and not subject to Chapter 552, Government Code.
(f) Permits for engaging in business as an e-cigarette
retailer are governed exclusively by the provisions of this code.
Sec. 147.0052. ISSUANCE OF PERMIT. (a) The comptroller
shall issue a permit to an applicant if the comptroller:
(1) has received an application and fee;
(2) does not reject the application and deny the
permit under Section 147.0053; and
(3) determines that issuing the permit will not
jeopardize the administration and enforcement of this chapter.
(b) The permit shall be issued for a designated place of
business, except as provided by Section 147.0056.
(c) The permits are nonassignable.
(d) The permit must indicate the type of permit and
authorize the sale of e-cigarettes in this state. The permit must
show that it is revocable and shall be forfeited or suspended if the
conditions of issuance, provisions of this chapter, or rules of the
comptroller are violated.
Sec. 147.0053. DENIAL OF PERMIT. The comptroller may
reject an application and deny a permit if the comptroller finds,
after notice and opportunity for hearing, any of the following:
(1) the premises where business will be conducted are
not adequate to protect the e-cigarettes; or
(2) the applicant or managing employee, or if the
applicant is a corporation, an officer, director, manager, or any
stockholder who holds directly or through family or partner
relationship 10 percent or more of the corporation's stock, or, if
the applicant is a partnership, a partner or manager:
(A) has failed to disclose any information
required by Sections 147.0051(c) and (d); or
(B) has previously violated provisions of this
chapter.
Sec. 147.0054. PERMIT PERIOD; FEES. (a) A permit required
by this chapter expires on the last day of May of each even-numbered
year.
(b) An application for a permit required by this chapter
must be accompanied by a fee of:
(1) one-half of the amount of the fee for a retailer's
permit required by Section 154.111(b), Tax Code, if the applicant
holds a valid retailer's permit under Section 154.101, 154.102, or
155.041, Tax Code; or
(2) the amount of the fee for a retailer's permit
required by Section 154.111(b), Tax Code.
(c) For a new or renewal permit required by Section
147.0051, the comptroller shall prorate the fee according to the
number of months remaining during the period that the permit is to
be in effect.
(d) A person who does not obtain a renewal permit in a timely
manner must pay a late fee of $50 in addition to the application fee
for the permit.
(e) If on the date of issuance a permit will expire within
three months, the comptroller may collect the prorated permit fee
or the fee for the current period and, with the consent of the
permit holder, may collect the fee for the next permit period and
issue a permit or permits for both periods, as applicable.
(f) A person issued a permit for a place of business that
permanently closes before the permit expiration date is not
entitled to a refund of the permit fee.
Sec. 147.0055. PAYMENT FOR PERMITS. (a) An applicant for a
permit required by Section 147.0051 shall send the required fee
with the application.
(b) The payment must be made in cash or by money order,
check, or credit card.
(c) The comptroller may not issue a permit in exchange for a
check until after the comptroller receives full payment on the
check.
Sec. 147.0056. DISPLAY OF PERMIT. (a) A permit holder
shall keep the permit on public display at the place of business for
which the permit was issued.
(b) A permit holder who has a permit assigned to a vehicle
shall post the permit in a conspicuous place on the vehicle.
Sec. 147.0057. REVENUE. Revenue from the sale of
e-cigarette retailer's permits shall be deposited to the general
revenue fund and may be appropriated only as provided by this
section. The money may be appropriated first to the comptroller for
administering:
(1) permitting of retailers under this chapter and
Chapters 154 and 155, Tax Code; and
(2) disciplinary actions taken under Section
161.0901.
SUBCHAPTER C. PERMIT SUSPENSION AND REVOCATION
Sec. 147.0101. FINAL SUSPENSION OR REVOCATION OF PERMIT.
(a) The comptroller may revoke or suspend a permit holder's permit
if the comptroller finds, after notice and hearing as provided by
this section, that the permit holder violated this chapter or a rule
adopted under this chapter.
(b) If the comptroller intends to suspend or revoke a
permit, the comptroller shall provide the permit holder with
written notice that includes a statement:
(1) of the reason for the intended revocation or
suspension;
(2) that the permit holder is entitled to a hearing by
the comptroller on the proposed suspension or revocation; and
(3) of the date, time, and place of the hearing.
(c) The comptroller shall deliver the written notice by
personal service or by mail to the permit holder's mailing address
as it appears in the comptroller's records. Service by mail is
complete when the notice is deposited with the United States Postal
Service.
(d) The comptroller shall give the permit holder notice
before the 10th day before the final hearing.
(e) A permit holder may appeal the comptroller's decision to
a district court in Travis County not later than the 30th day after
the date the comptroller's decision becomes final.
(f) A person whose permit is suspended or revoked may not
sell, offer for sale, or distribute e-cigarettes from the place of
business to which the permit applied until a new permit is granted
or the suspension is removed.
Sec. 147.0102. SUMMARY SUSPENSION OF PERMIT. (a) The
comptroller may suspend a permit holder's permit without notice or
a hearing for the permit holder's failure to comply with this
chapter or a rule adopted under this chapter if the permit holder's
continued operation constitutes an immediate and substantial
threat.
(b) If the comptroller summarily suspends a permit holder's
permit, proceedings for a preliminary hearing before the
comptroller or the comptroller's representative must be initiated
simultaneously with the summary suspension. The preliminary
hearing shall be set for a date not later than the 10th day after the
date of the summary suspension, unless the parties agree to a later
date.
(c) At the preliminary hearing, the permit holder must show
cause why the permit should not remain suspended pending a final
hearing on suspension or revocation.
(d) Chapter 2001, Government Code, does not apply to a
summary suspension under this section.
(e) To initiate a proceeding to suspend summarily a permit
holder's permit, the comptroller shall serve notice on the permit
holder informing the permit holder of the right to a preliminary
hearing before the comptroller or the comptroller's representative
and of the time and place of the preliminary hearing. The notice
must be personally served on the permit holder or an officer,
employee, or agent of the permit holder or sent by certified or
registered mail, return receipt requested, to the permit holder's
mailing address as it appears in the comptroller's records. The
notice must state the alleged violations that constitute the
grounds for summary suspension. The suspension is effective at the
time the notice is served. If notice is served in person, the
permit holder shall immediately surrender the permit to the
comptroller. If notice is served by mail, the permit holder shall
immediately return the permit to the comptroller.
(f) Section 147.0101, governing hearings for final
suspension or revocation of a permit under this chapter, governs a
final administrative hearing.
SECTION 2. Sections 161.081(1-a), (2), and (4), Health and
Safety Code, are amended to read as follows:
(1-a) "E-cigarette" means an electronic cigarette or
any other device that simulates smoking by using a mechanical
heating element, battery, or electronic circuit to deliver nicotine
or other substances to the individual inhaling from the device or a
consumable liquid solution or other material aerosolized or
vaporized during the use of an electronic cigarette or other device
described by this subdivision, regardless of whether the liquid or
other material contains nicotine. The term does not include a
prescription medical device unrelated to the cessation of smoking.
The term includes:
(A) a device described by this subdivision
regardless of whether the device is manufactured, distributed, or
sold as an e-cigarette, e-cigar, or e-pipe or under another product
name or description; and
(B) a component, part, or accessory for the
device, regardless of whether the component, part, or accessory is
sold separately from the device.
(2) "Permit holder" has the meaning assigned by
Section 147.0001 of this code or Section 154.001 or 155.001, Tax
Code, as applicable.
(4) "Retailer" means a person who engages in the
practice of selling cigarettes, e-cigarettes, or tobacco products
to consumers and includes the owner of a coin-operated cigarette,
e-cigarette, or tobacco product vending machine. The term includes
a retailer as [that term is] defined by Section 154.001 or 155.001,
Tax Code, and an e-cigarette retailer as defined by Section
147.0001 of this code, as applicable.
SECTION 3. Section 161.083(d), Health and Safety Code, is
amended to read as follows:
(d) Notwithstanding any other provision of law, a violation
of this section is not a violation of this subchapter for purposes
of Section 161.0901 [154.1142 or 155.0592, Tax Code].
SECTION 4. Subchapter H, Chapter 161, Health and Safety
Code, is amended by adding Section 161.0901 to read as follows:
Sec. 161.0901. DISCIPLINARY ACTION AGAINST CIGARETTE,
E-CIGARETTE, AND TOBACCO PRODUCT RETAILERS. (a) A retailer is
subject to disciplinary action as provided by this section if an
agent or employee of the retailer commits an offense under this
subchapter.
(b) If the comptroller finds, after notice and an
opportunity for a hearing as provided by Chapter 2001, Government
Code, that a permit holder has violated this subchapter at a place
of business for which a permit is issued, the comptroller may
suspend the permit for that place of business and administratively
assess a fine as follows:
(1) if the permit holder has not been found to have
violated this subchapter at that place of business during the
24-month period preceding the violation, the comptroller may
require the permit holder to pay a fine in an amount not to exceed
$1,000;
(2) if the permit holder has been found to have
violated this subchapter at that place of business once during the
24-month period preceding the violation, the comptroller may
require the permit holder to pay a fine in an amount not to exceed
$2,000; and
(3) if the permit holder has been found to have
violated this subchapter at that place of business at least twice
during the 24-month period preceding the violation, the comptroller
may:
(A) require the permit holder to pay a fine in an
amount not to exceed $3,000; and
(B) suspend the permit for that place of business
for not more than five days.
(c) Except as provided by Subsection (e), if the permit
holder has been found to have violated this subchapter on four or
more previous and separate occasions at the same place of business
during the 24-month period preceding the violation, the comptroller
shall revoke the permit issued under Chapter 147 of this code or
Chapter 154 or 155, Tax Code, as applicable. If the permit holder
does not hold a permit under Chapter 147 of this code or Chapter 154
or 155, Tax Code, the comptroller shall revoke the permit issued
under Section 151.201, Tax Code.
(d) A permit holder whose permit has been revoked under this
section may not apply for a permit for the same place of business
before the expiration of six months after the effective date of the
revocation.
(e) For purposes of this section, the comptroller may
suspend a permit but may not revoke the permit under Subsection (c)
if the comptroller finds that:
(1) the employer has not violated this subchapter more
than seven times at the place of business for which the permit is
issued in the 48-month period preceding the violation in question;
(2) the employer requires its employees to attend a
comptroller-approved seller training program;
(3) the employees have actually attended a
comptroller-approved seller training program; and
(4) the employer has not directly or indirectly
encouraged the employees to violate the law.
(f) The comptroller may adopt rules to implement this
section.
SECTION 5. Section 111.00455(b), Tax Code, is amended to
read as follows:
(b) The following are not contested cases under Subsection
(a) and Section 2003.101, Government Code:
(1) a show cause hearing or any hearing not related to
the collection, receipt, administration, or enforcement of the
amount of a tax or fee imposed, or the penalty or interest
associated with that amount, except for a hearing under Section
151.157(f), 151.1575(c), or 151.712(g) of this code or Section
161.0901, Health and Safety Code[, 154.1142, or 155.0592];
(2) a property value study hearing under Subchapter M,
Chapter 403, Government Code;
(3) a hearing in which the issue relates to:
(A) Chapters 72-75, Property Code;
(B) forfeiture of a right to do business;
(C) a certificate of authority;
(D) articles of incorporation;
(E) a penalty imposed under Section 151.703(d);
(F) the refusal or failure to settle under
Section 111.101; or
(G) a request for or revocation of an exemption
from taxation; and
(4) any other hearing not related to the collection,
receipt, administration, or enforcement of the amount of a tax or
fee imposed, or the penalty or interest associated with that
amount.
SECTION 6. Section 154.1135(b), Tax Code, is amended to
read as follows:
(b) The payment must be made in cash or by money order, [or]
check, or credit card.
SECTION 7. Section 154.121(b), Tax Code, is amended to read
as follows:
(b) Revenue from the sale of retailer's permits shall be
deposited to the general revenue fund and may be appropriated only
as provided by this section. The money may be appropriated first to
the comptroller for administering:
(1) permitting [administration of licensing] of
retailers under this chapter, Chapter [or Chapter] 155 of this
code, and Chapter 147, Health and Safety Code; and
(2) disciplinary actions taken under Section
161.0901, Health and Safety Code.
SECTION 8. Section 155.050(b), Tax Code, is amended to read
as follows:
(b) The payment must be made in cash or by money order, [or]
check, or credit card.
SECTION 9. Section 155.058(b), Tax Code, is amended to read
as follows:
(b) Revenue from the sale of retailer's permits shall be
deposited to the general revenue fund and may be appropriated only
as provided by this section. The money may be appropriated first to
the comptroller for administering:
(1) permitting [administration of licensing] of
retailers under this chapter, Chapter [or Chapter] 154 of this
code, and Chapter 147, Health and Safety Code; and
(2) disciplinary actions taken under Section
161.0901, Health and Safety Code.
SECTION 10. Chapters 154 and 155, Tax Code, are amended to
read as follows:
Sec. 154.001. DEFINITIONS. In this chapter:
(1) "Bonded agent" means a person in this state who is
a third-party agent of a manufacturer outside this state and who
receives cigarettes in interstate commerce and stores the
cigarettes for distribution or delivery to distributors under
orders from the manufacturer.
(2) "Cigarette" means a roll for smoking:
(A) that is made of tobacco or tobacco mixed with
another ingredient and wrapped or covered with a material other
than tobacco; and
(B) that is not a cigar.
(3) "Commercial business location" means the entire
premises occupied by a permit applicant or a person required to hold
a permit under this chapter.
(4) "Common carrier" means a motor carrier registered
under Chapter 643, Transportation Code, or a motor carrier
operating under a certificate issued by the Interstate Commerce
Commission or a successor agency to the Interstate Commerce
Commission.
(5) "Consumer" means a person who possesses cigarettes
for personal consumption.
(6) "Counterfeit stamp" means a sticker, label, print,
tag, or token that is used or is intended to be used to simulate a
stamp and that is not authorized or issued by the comptroller.
(7) "Distributor" means a person who:
(A) is authorized to purchase for the purpose of
making a first sale in this state cigarettes in unstamped packages
from manufacturers who distribute cigarettes in this state and to
stamp cigarette packages;
(B) ships, transports, imports into this state,
acquires, or possesses cigarettes and makes a first sale of the
cigarettes in this state;
(C) manufactures or produces cigarettes; or
(D) is an importer.
(7-a) "Engage in business" means, in relation to
cigarettes, engaging by a person, either directly or through a
representative, in any of the following activities:
(A) selling cigarettes in or into this state;
(B) using a warehouse or another location to
store cigarettes; or
(C) otherwise conducting through a physical
presence cigarette-related business in this state.
(8) "Export warehouse" means a person in this state
who receives cigarettes in unstamped packages from manufacturers
and stores the cigarettes for the purpose of making sales to
authorized persons for resale, use, or consumption outside the
United States.
(9) "First sale" means, except as otherwise provided
by this chapter:
(A) the first transfer of possession in
connection with a purchase, sale, or any exchange for value of
cigarettes in or into this state, which:
(i) includes the sale of cigarettes by:
(a) a distributor in or outside this
state to a distributor, wholesaler, or retailer in this state; and
(b) a manufacturer in this state who
transfers the cigarettes in this state; and
(ii) does not include:
(a) the sale of cigarettes by a
manufacturer outside this state to a distributor in this state;
[or]
(b) the transfer of cigarettes from a
manufacturer outside this state to a bonded agent in this state; or
(c) the sale of cigarettes from a
manufacturer, bonded agent, distributor, or importer to an
interstate warehouse in this state;
(B) the first use or consumption of cigarettes in
this state; or
(C) the loss of cigarettes in this state whether
through negligence, theft, or other unaccountable loss.
(10) "Importer" means a person who ships, transports,
or imports into this state cigarettes manufactured or produced
outside the United States for the purpose of making a first sale in
this state.
(11) "Individual package of cigarettes" means a
package that contains at least 20 cigarettes.
(11-a) "Interstate warehouse" means a person in this
state who receives unstamped cigarettes from a manufacturer, bonded
agent, importer, or distributor and stores the cigarettes
exclusively for an interstate warehouse transaction.
(11-b) "Interstate warehouse transaction" means the
sale or delivery from an interstate warehouse to a person in another
state who is licensed or permitted by the other state to affix that
state's cigarette stamps or otherwise pay the state's excise tax on
cigarettes as may be required.
(12) "Manufacturer" means a person who manufactures,
fabricates, or assembles cigarettes, or causes or arranges for the
manufacture, fabrication, or assembly of cigarettes, for sale or
distribution.
(13) "Manufacturer's representative" means a person
employed by a manufacturer to sell or distribute the manufacturer's
stamped cigarette packages.
(14) "Permit holder" means a bonded agent, interstate
warehouse, distributor, wholesaler, manufacturer, importer, export
warehouse, or retailer who obtains a permit under Section 154.101.
(15) "Place of business" means:
(A) a commercial business location where
cigarettes are sold;
(B) a commercial business location where
cigarettes are kept for sale or consumption or otherwise stored;
(C) a vehicle from which cigarettes are sold; or
(D) a vending machine from which cigarettes are
sold.
(16) "Previously used stamp" means a stamp that has
been used to show payment of a tax imposed by this chapter and is
again used, sold, or possessed for sale or use to show payment of a
tax imposed by this chapter.
(17) "Retailer" means a person who engages in the
business of selling cigarettes to consumers and includes the owner
of a cigarette vending machine.
(17-a) "Roll-your-own machine" means a machine for
commercial use at a retail premise that is capable of producing
cigarettes only in quantities for personal use.
(18) "Stamp" includes only a stamp that:
(A) is printed, manufactured, or made by
authority of the comptroller;
(B) shows payment of the tax imposed by this
chapter;
(C) is consecutively numbered and uniquely
identifiable as a Texas tax stamp; and
(D) is not damaged beyond recognition as a valid
Texas tax stamp.
(19) "Wholesaler" means a person, including a
manufacturer's representative, who sells or distributes cigarettes
in this state for resale but who is not a distributor or interstate
warehouse.
Sec. 154.041. STAMP REQUIRED. (a) A person who pays a tax
imposed by this chapter shall securely affix a stamp to each
individual package of cigarettes to show payment of the tax.
(b) Except as provided by Section 154.152, each distributor
shall obtain the necessary stamps before receiving or accepting
delivery of unstamped packages of cigarettes. The possession of
unstamped packages of cigarettes without the possession of the
requisite amount or number of stamps is prima facie evidence that
the cigarettes are possessed for the purpose of making a first sale
without stamps and without payment of the tax imposed by this
chapter.
(c) The absence of a stamp on an individual package of
cigarettes is notice that the tax has not been paid.
(d) A manufacturer of cigarettes outside this state may
purchase a stamp and affix it to the individual package and no
further payment of the tax is required.
(e) The transfer of possession of cigarettes by a bonded
agent to a distributor in this state, under instructions received
from outside this state, is not a first sale.
(f) The transfer of possession of cigarettes by an
interstate warehouse in an interstate warehouse transaction is not
a first sale and no stamp is required.
Sec. 154.101. PERMITS. (a) A person may not engage in
business as a distributor, wholesaler, bonded agent, interstate
warehouse, manufacturer, export warehouse, importer, or retailer
unless the person has applied for and received the applicable
permit from the comptroller.
(b) Each distributor, wholesaler, bonded agent, interstate
warehouse, manufacturer, export warehouse, importer, or retailer
shall obtain a permit for each place of business owned or operated
by the distributor, wholesaler, bonded agent, interstate
warehouse, manufacturer, export warehouse, importer, or retailer.
The comptroller may not issue a permit for a place of business that
is a residence or a unit in a public storage facility.
(c) The comptroller shall prescribe the form and content of
an application for a permit and shall furnish the form on request of
an applicant.
(d) The applicant shall accurately complete all information
required by the application and provide the comptroller with such
additional information as the comptroller deems necessary.
(e) The comptroller may require each corporation,
association, joint venture, syndicate, partnership, or
proprietorship to furnish financial information regarding the
applicant and to provide the identity of each officer, director,
stockholder owning 10 percent or more of the outstanding stock,
partner, member, owner, or managing employee.
(f) Each distributor, wholesaler, and retailer that applies
for a permit to sell cigarettes from a vehicle must provide the
make, model, vehicle identification number, registration number,
and any other information required by the comptroller.
(g) All financial information provided under this section
is confidential and not subject to Chapter 552, Government Code.
(h) Permits for engaging in business as a distributor,
wholesaler, bonded agent, interstate warehouse, manufacturer,
export warehouse, importer, or retailer shall be governed
exclusively by the provisions of this code.
(i) This section does not apply to a research facility that
possesses and uses cigarettes only for experimental purposes.
(j) A person engaged in the business of selling cigarettes
for commercial purposes who provides a roll-your-own machine
available for use by consumers must obtain manufacturer's,
distributor's, and retailer's permits.
(k) A person may not hold a Texas distributor permit and an
interstate warehouse permit at the same location.
Sec. 154.1015. SALES; PERMIT HOLDERS AND NONPERMIT HOLDERS.
(a) Except for retail sales to consumers, cigarettes may only be
sold or distributed by and between permit holders as provided by
this section.
(b) A person who is not a permit holder may not sell or
distribute more than 200 individual cigarettes to any person.
(c) A manufacturer outside this state who is not a permitted
distributor may sell cigarettes only to a permitted distributor or
permitted interstate warehouse.
(d) A permitted distributor may sell cigarettes only to a
permitted distributor, wholesaler, or retailer. A permitted
distributor who manufactures or produces cigarettes in this state
may sell such cigarettes manufactured or produced to a permitted
interstate warehouse.
(e) A permitted importer may sell cigarettes only to a
permitted interstate warehouse, permitted distributor, wholesaler,
or retailer.
(f) A permitted wholesaler may sell cigarettes only to a
permitted distributor, wholesaler, or retailer.
(g) A permitted retailer may sell cigarettes only to the
consumer and may purchase cigarettes only from a permitted
distributor or wholesaler in this state.
(h) A permitted export warehouse may sell cigarettes only to
persons authorized to sell or consume unstamped cigarettes outside
the United States.
(i) A manufacturer's representative may sell cigarettes
only to a permitted distributor, wholesaler, or retailer.
(j) A permitted interstate warehouse may sell cigarettes
only in an interstate warehouse transaction. No intrastate sale of
cigarettes by an interstate warehouse shall take place without
written authorization by the comptroller.
Sec. 154.102. COMBINATION PERMIT. (a) The comptroller may
issue a combination permit for cigarettes and tobacco products to a
person who is a distributor, wholesaler, bonded agent, interstate
warehouse, manufacturer, importer, or retailer as defined by this
chapter and Chapter 155 for both cigarettes and tobacco products.
An interstate warehouse shall not be issued a combination permit as
a retailer of cigarettes or tobacco products.
(b) A person who receives a combination permit pays only the
higher of the two permit fees.
Sec. 154.110. ISSUANCE OF PERMIT. (a) The comptroller
shall issue a permit to a distributor, wholesaler, bonded agent,
interstate warehouse, manufacturer, export warehouse, importer, or
retailer if the comptroller:
(1) has received an application and fee, if required;
(2) believes that the applicant has complied with
Section 154.101; and
(3) determines that issuing the permit will not
jeopardize the administration and enforcement of this chapter.
(b) The permit shall be issued for a designated place of
business, except as provided by Section 154.117.
(c) The permits are nonassignable.
(d) The permit must indicate the type of permit that it is
and authorize the sale of cigarettes in this state. The permit must
show that it is revocable and shall be forfeited or suspended if the
conditions of issuance, provisions of this chapter, or rules of the
comptroller are violated.
Sec. 154.111. PERMIT YEAR; FEES. (a) A permit required by
this chapter expires on the last day of February of each year,
except that the retailer's permit required by Section 154.101
expires on the last day of May of each even-numbered year.
(b) An application for a permit required by this chapter
must be accompanied by a fee of:
(1) $300 for a bonded agent's permit;
(2) $300 for an interstate warehouse's permit;
(3) [(2)] $300 for a distributor's permit;
(4) [(3)] $200 for a wholesaler's permit;
(5) [(4)] $15 for each permit for a vehicle if the
applicant is also applying for a permit as a bonded agent,
distributor, or wholesaler or has received a current permit from
the comptroller under Sections 154.101 and 154.110; and
(6) [(5)] $180 for a retailer's permit.
(c) A fee is not required for an export warehouse permit.
(d) For a new or renewal permit required by Section 154.101,
the comptroller shall prorate the fee according to the number of
months remaining during the calendar year that the permit is to be
in effect.
(e) A person who does not obtain a permit each year in a
timely manner must pay a fee of $50 in addition to the application
fee for the permit.
(f) If at the date of issuance a permit will expire within
three months, the comptroller may collect the prorated permit fee
or the fee for the current year and, with the consent of the permit
holder, may collect the fee for the next permit year and issue a
permit or permits for both periods, as applicable.
(g) A person issued a permit for a place of business that
permanently closes before the permit expiration date is not
entitled to a refund of the permit fee.
Sec. 154.121. REVENUE. (a) Except as provided by
Subsection (b), revenue from the sale of permits to distributors,
wholesalers, [and] bonded agents, and interstate warehouses is
allocated in the same manner as other revenue allocated by
Subchapter J.
(b) Revenue from the sale of retailer's permits shall be
deposited to the general revenue fund and may be appropriated only
as provided by this section. The money may be appropriated first to
the comptroller for administration of licensing of retailers under
this chapter or Chapter 155.
(c) If, after any appropriation is made under Subsection
(b), revenue remains from the sale of retailer's permits, the
remaining money may be appropriated to the comptroller for
administration and enforcement of Subchapters H, K, and N, Chapter
161, Health and Safety Code, and to the Texas Department of Health,
for the administration and enforcement of Section 161.253, Health
and Safety Code.
(d) If, after any appropriation is made under Subsections
(b) and (c), revenue remains from the sale of retailer's permits,
the remaining money may be appropriated to the Texas Department of
Health to administer the commissioner of public health's
responsibilities under Section 161.301, Health and Safety Code.
(e) If, after any appropriation is made under Subsections
(b), (c), and (d), revenue remains from the sale of retailer's
permits, the remaining money may be appropriated to the appropriate
entity to administer that entity's responsibilities under Section
161.302, Health and Safety Code.
Sec. 154.152. INTERSTATE STOCK. (a) A distributor shall
set aside unstamped cigarette packages for interstate sale and for
which no tax is due under federal law in a separate part of the
building from the stamped packages. If the unstamped packages for
interstate sale or for which no tax is due under federal law are not
stored separately, the cigarettes are subject to the same
requirements as cigarettes possessed for the purpose of a first
sale in this state.
(b) A distributor who possesses unstamped cigarette
packages for interstate sale must possess a number of unused stamps
from the appropriate state sufficient to stamp the distributor's
inventory of unstamped interstate cigarettes, except for cigarette
packages for which no tax is due under federal law. Any unstamped
packages of cigarettes that exceed the number of out-of-state
stamps on hand shall be presumed to be held for sale in this state,
except for cigarette packages for which no tax is due under federal
law.
(c) A person may not transport or cause to be transported
from this state cigarettes for sale in another state without first
affixing to the cigarettes the stamp required by the state in which
the cigarettes are to be sold or paying any other excise tax on the
cigarettes imposed by the state in which the cigarettes are to be
sold. This provision shall not apply to distribution, sale and
transportation of cigarettes sold by an interstate warehouse in an
interstate warehouse transaction.
(d) A person may not affix to cigarettes the stamp required
by another state or pay any other excise tax on the cigarettes
imposed by another state if the other state prohibits stamps from
being affixed to the cigarettes, prohibits the payment of any other
excise tax on the cigarettes, or prohibits the sale of the
cigarettes.
(e) Not later than the 15th day after the end of each
calendar quarter, a person who transports or causes to be
transported from this state cigarettes for sale in another state
shall submit to the attorney general a report identifying:
(1) the quantity of cigarettes, by brand style,
transported or caused to be transported in the preceding calendar
quarter; and
(2) the name and address of each recipient of the
cigarettes.
Sec. 154.201. RECORD OF PURCHASE OR RECEIPT. Each
distributor, wholesaler, bonded agent, interstate warehouse, and
export warehouse shall keep records at each place of business of all
cigarettes purchased or received, including records of those
cigarettes for which no tax is due under federal law. Each retailer
shall keep records at a single commercial business location, which
the retailer shall designate as its principal place of business in
this state, of all cigarettes purchased and received. These
records must include:
(1) the name and address of the shipper or carrier and
the mode of transportation;
(2) all shipping records or copies of records,
including invoices, bills of lading, waybills, freight bills, and
express receipts;
(3) the date and the name of the place of origin of the
cigarette shipment;
(4) the date and the name of the place of arrival of
the cigarette shipment;
(5) a statement of the number, kind, and price paid for
cigarettes, including cigarettes in stamped and unstamped
packages;
(6) the name, address, permit number, and tax
identification number of the seller;
(7) in the case of a distributor, copies of the customs
certificates required by 19 U.S.C. Section 1681a(c), as amended,
for all cigarettes imported into the United States to which the
distributor has affixed a tax stamp; and
(8) any other information required by rules of the
comptroller.
Sec. 154.203. REPORT OF SALE OR USE. (a) Each interstate
warehouse, distributor, and wholesaler shall keep at each place of
business in this state records of each sale, distribution,
exchange, or use of cigarettes whether taxed under this chapter or
not. Each interstate warehouse, distributor, and wholesaler shall
prepare and retain an original invoice for each transaction
involving cigarettes. Each interstate warehouse, distributor, or
wholesaler shall keep any supporting documentation, including
bills of lading, showing shipment and receipt used in preparing the
invoices at the place of business of the interstate warehouse,
distributor, or wholesaler. The interstate warehouse,
distributor, or wholesaler shall prepare and deliver a duplicate
invoice to the purchaser.
(b) The records for each sale, distribution, exchange, or
use of cigarettes must show:
(1) the purchaser's name and address, permit number,
or tax identification number;
(2) the method of delivery and the name of the common
carrier or other person delivering the cigarettes;
(3) the date, number, and kind of cigarettes in
stamped packages sold, distributed, exchanged, or used; and
(4) the date, number, and kind of cigarettes in
unstamped packages sold, distributed, exchanged, or used.
(c) Upon request by the comptroller, each interstate
warehouse shall provide to the comptroller copies of periodic
cigarette reports filed with each state into which the interstate
warehouse sells cigarettes and copies of the PACT Act report
required by 15 U.S.C. 376.
Sec. 154.501. PENALTIES. (a) A person violates this
chapter if the person:
(1) is a distributor, wholesaler, manufacturer,
export warehouse, importer, bonded agent, interstate warehouse,
manufacturer's representative, or retailer and fails to keep
records required by this chapter;
(2) engages in the business of a bonded agent,
interstate warehouse, distributor, wholesaler, manufacturer,
export warehouse, importer, or retailer without a valid permit;
(3) is a distributor, wholesaler, manufacturer,
export warehouse, importer, bonded agent, interstate warehouse, or
retailer and fails to make a report or makes a false or incomplete
report or application required by this chapter to the comptroller;
or
(4) is a person affected by this chapter and fails or
refuses to abide by or violates a provision of this chapter or a
rule adopted by the comptroller under this chapter.
(b) A person who violates this section shall pay to the
state a penalty of not more than $2,000 for each violation.
(c) Each day on which a violation occurs is a separate
offense.
(d) The attorney general shall bring a suit to recover
penalties under this section.
(e) A suit under this section may be brought in a court of
competent jurisdiction in Travis County or in any court having
jurisdiction.
Sec. 154.503. POSSESSION IN QUANTITIES LESS THAN 10,000.
(a) Except as provided by Sections 154.026(b), 154.041(f), and
154.042, a person commits an offense if the person possesses
unstamped cigarettes in quantities less than 10,000.
(b) This section does not prohibit transportation of
cigarettes by a common carrier.
Sec. 154.509. PERMITS. A person commits an offense if the
person acting:
(1) as a distributor, interstate warehouse,
wholesaler, or retailer, receives or possesses cigarettes without
having a valid permit;
(2) as a distributor, interstate warehouse,
wholesaler, or retailer, receives or possesses cigarettes without
having a permit posted where it can be easily seen by the public;
(3) as a distributor, interstate warehouse, or
wholesaler, does not deliver an invoice to the purchaser as
required by Section 154.203;
(4) as a distributor, interstate warehouse,
wholesaler, or retailer, sells cigarettes without having a valid
permit; or
(5) as a bonded agent, interstate warehouse, or export
warehouse, stores, distributes, or delivers cigarettes in
unstamped packages without having a valid permit.
Sec. 154.511. TRANSPORTATION OF CIGARETTES. A person,
other than a common carrier, commits an offense if the person:
(1) knowingly transports cigarettes without a stamp
affixed to each individual package, except as provided by Section
154.024(a) or Section 154.152(c);
(2) wilfully refuses to stop a motor vehicle operated
to transport cigarettes after a request to stop from an authorized
person; or
(3) while transporting cigarettes refuses to permit a
complete inspection of the cargo by an authorized person.
Sec. 154.515. POSSESSION IN QUANTITIES OF 10,000 OR MORE.
(a) Except as provided by Sections 154.026(b), 154.041(f), and
154.042, a person commits an offense if the person possesses
unstamped cigarettes in quantities of 10,000 or more.
(b) This section does not prohibit transportation of
cigarettes by a common carrier.
Sec. 155.001. DEFINITIONS. In this chapter:
(1) "Bonded agent" means a person in this state who is
a third-party agent of a manufacturer outside this state and who
receives tobacco products in interstate commerce and stores the
tobacco products for distribution or delivery to distributors under
orders from the manufacturer.
(2) "Cigar" means a roll of fermented tobacco that is
wrapped in tobacco and the main stream of smoke from which produces
an alkaline reaction to litmus paper.
(3) "Commercial business location" means the entire
premises occupied by a permit applicant or a person required to hold
a permit under this chapter.
(4) "Common carrier" means a motor carrier registered
under Chapter 643, Transportation Code, or a motor carrier
operating under a certificate issued by the Interstate Commerce
Commission or a successor agency to the Interstate Commerce
Commission.
(5) "Consumer" means a person who possesses tobacco
products for personal consumption.
(6) "Distributor" means a person who:
(A) receives untaxed tobacco products for the
purpose of making a first sale in this state from a manufacturer
outside the state or within the state or otherwise brings or causes
to be brought into this state untaxed tobacco products for sale,
use, or consumption;
(B) manufactures or produces tobacco products;
or
(C) is an importer.
(6-a) "Engage in business" means, in relation to
tobacco products, engaging by a person, either directly or through
a representative, in any of the following activities:
(A) selling tobacco products in or into this
state;
(B) using a warehouse or another location to
store tobacco products; or
(C) otherwise conducting through a physical
presence tobacco product-related business in this state.
(7) "Export warehouse" means a person in this state
who receives untaxed tobacco products from manufacturers and stores
the tobacco products for the purpose of making sales to authorized
persons for resale, use, or consumption outside the United States.
(8) "First sale" means, except as otherwise provided
by this chapter:
(A) the first transfer of possession in
connection with a purchase, sale, or any exchange for value of
tobacco products in or into this state, which:
(i) includes the sale of tobacco products
by:
(a) a distributor in or outside this
state to a distributor, wholesaler, or retailer in this state; and
(b) a manufacturer in this state who
transfers the tobacco products in this state; and
(ii) does not include:
(a) the sale of tobacco products by a
manufacturer outside this state to a distributor in this state;
[or]
(b) the transfer of tobacco products
from a manufacturer outside this state to a bonded agent in this
state; or
(c) the sale of tobacco products from
a manufacturer, bonded agent, distributor, or importer to an
interstate warehouse in this state;
(B) the first use or consumption of tobacco
products in this state; or
(C) the loss of tobacco products in this state
whether through negligence, theft, or other unaccountable loss.
(9) "Importer" means a person who ships, transports,
or imports into this state tobacco products manufactured or
produced outside the United States for the purpose of making a first
sale in this state.
(9-a) "Interstate warehouse" means a person in this
state who receives untaxed tobacco products from a manufacturer,
bonded agent, importer, or distributor and stores the tobacco
products exclusively for an interstate warehouse transaction.
(9-b) "Interstate warehouse transaction" means the
sale or delivery from an interstate warehouse to a person in another
state who is licensed or permitted by the other state to pay the
state's excise tax on tobacco products as may be required.
(10) "Manufacturer" means a person who manufactures,
fabricates, or assembles tobacco products, or causes or arranges
for the manufacture, fabrication, or assembly of tobacco products,
for sale or distribution.
(11) "Manufacturer's representative" means a person
employed by a manufacturer to sell or distribute the manufacturer's
tobacco products for which the tax imposed under this chapter has
been paid.
(12) "Permit holder" means a bonded agent, interstate
warehouse, distributor, wholesaler, manufacturer, importer, export
warehouse, or retailer who obtains a permit under Section 155.041.
(13) "Place of business" means:
(A) a commercial business location where tobacco
products are sold;
(B) a commercial business location where tobacco
products are kept for sale or consumption or otherwise stored;
(C) a vehicle from which tobacco products are
sold; or
(D) a vending machine from which tobacco products
are sold.
(13-a) "Raw tobacco" means any part of the tobacco
plant, including the tobacco leaf or stem, that is harvested from
the ground and is not a tobacco product as the term is defined in
this chapter.
(14) "Retailer" means a person who engages in the
business of selling tobacco products to consumers and includes the
owner of a vending machine.
(15) "Tobacco product" means:
(A) a cigar;
(B) smoking tobacco, including granulated,
plug-cut, crimp-cut, ready-rubbed, and any form of tobacco suitable
for smoking in a pipe or as a cigarette;
(C) chewing tobacco, including Cavendish, Twist,
plug, scrap, and any kind of tobacco suitable for chewing;
(D) snuff or other preparations of pulverized
tobacco; or
(E) an article or product that is made of tobacco
or a tobacco substitute and that is not a cigarette or an
e-cigarette as defined by Section 161.081, Health and Safety Code.
(16) "Wholesaler" means a person, including a
manufacturer's representative, who sells or distributes tobacco
products in this state for resale but who is not a distributor or
interstate warehouse.
Sec. 155.041. PERMITS. (a) A person may not engage in
business as a distributor, wholesaler, bonded agent, interstate
warehouse, manufacturer, export warehouse, importer, or retailer
unless the person has applied for and received the applicable
permit from the comptroller.
(b) Each distributor, wholesaler, bonded agent, interstate
warehouse, manufacturer, export warehouse, importer, or retailer
shall obtain a permit for each place of business owned or operated
by the distributor, wholesaler, bonded agent, interstate
warehouse, manufacturer, export warehouse, importer, or retailer.
(c) The comptroller shall prescribe the form and content of
an application for a permit and shall furnish the form on request of
an applicant.
(d) The applicant shall accurately complete all information
required by the application and provide the comptroller with
additional information the comptroller considers necessary.
(e) The comptroller may require each corporation,
association, joint venture, syndicate, partnership, or
proprietorship to furnish financial information regarding the
applicant and to provide the identity of each officer, director,
stockholder owning 10 percent or more of the outstanding stock,
partner, member, owner, or managing employee.
(f) Each distributor, wholesaler, and retailer that applies
for a permit to sell tobacco products from a vehicle must provide
the make, model, vehicle identification number, registration
number, and any other information required by the comptroller.
(g) All financial information provided under this section
is confidential and not subject to Chapter 552, Government Code.
(h) Permits for engaging in business as a distributor,
wholesaler, bonded agent, interstate warehouse, manufacturer,
export warehouse, importer, or retailer shall be governed
exclusively by the provisions of this code.
(i) A person may not hold a Texas distributor permit and an
interstate warehouse permit at the same location.
Sec. 155.0415. SALES: PERMIT HOLDERS AND NONPERMIT
HOLDERS. (a) Except for retail sales to consumers, tobacco
products may only be sold or distributed by and between permit
holders as provided by this section.
(b) A person who is not a permit holder may not sell or
distribute tobacco products on which a tax of more than $50 has been
paid or is due.
(c) A manufacturer outside this state who is not a permitted
distributor may sell tobacco products only to a permitted
distributor or a permitted interstate warehouse.
(d) A permitted distributor may sell tobacco products only
to a permitted distributor, wholesaler, or retailer. A permitted
distributor who manufactures or produces tobacco products in this
state may sell such tobacco products manufactured or produced to a
permitted interstate warehouse.
(e) A permitted importer may sell tobacco products only to a
permitted interstate warehouse, permitted distributor, wholesaler,
or retailer.
(f) A permitted wholesaler may sell tobacco products only to
a permitted interstate warehouse, permitted distributor,
wholesaler, or retailer.
(g) A permitted retailer may sell tobacco products only to
the consumer and may purchase tobacco products only from a
permitted distributor or wholesaler in this state.
(h) A permitted export warehouse may sell tobacco products
only to persons authorized to sell or consume untaxed tobacco
products outside the United States.
(i) A manufacturer's representative may sell tobacco
products only to a permitted distributor, wholesaler, or retailer.
(j) A permitted interstate warehouse may sell tobacco
products only in an interstate warehouse transaction. No
intrastate sale of tobacco products by an interstate warehouse
shall take place without written authorization by the comptroller.
Sec. 155.048. ISSUANCE OF PERMITS. (a) The comptroller
shall issue a permit to an interstate warehouse, [a] distributor,
wholesaler, bonded agent, manufacturer, importer, or retailer if
the comptroller:
(1) has received an application and fee, if required;
(2) does not reject the application and deny the
permit under Section 155.0481; and
(3) determines that issuing the permit will not
jeopardize the administration and enforcement of this chapter.
(b) The permit shall be issued for a designated place of
business, except as provided by Section 155.053.
(c) The permits are nonassignable.
(d) The permit must indicate the type of permit that it is
and authorize the sale of tobacco products in this state. The
permit must show that it is revocable and shall be forfeited or
suspended if the conditions of issuance, provisions of this
chapter, or rules of the comptroller are violated.
Sec. 155.049. PERMIT YEAR; FEES. (a) A permit required by
this chapter expires on the last day of February of each year,
except the retailer's permit required by Section 155.041 expires on
the last day of May of each even-numbered year.
(b) An application for a permit required by this chapter
must be accompanied by a fee of:
(1) $300 for a bonded agent's permit;
(2) $300 for an interstate warehouse's permit;
(3) [(2)] $300 for a distributor's permit;
(4) [(3)] $200 for a wholesaler's permit;
(5) [(4)] $15 for each permit for a vehicle if the
applicant is also applying for a permit as a bonded agent,
distributor, or wholesaler or has received a current permit from
the comptroller under Sections 155.041 and 155.048; and
(6) [(5)] $180 for a retailer's permit.
(c) A fee is not required for an export warehouse permit.
(d) For a new or renewal permit required by Section 155.041,
the comptroller shall prorate the fee according to the number of
months remaining during the calendar year that the permit is to be
in effect.
(e) A person who does not obtain a permit each year in a
timely manner must pay a late fee of $50 in addition to the
application fee for the permit.
(f) If at the date of issuance a permit will expire within
three months, the comptroller may collect the prorated permit fee
or the fee for a current year and, with the consent of the permit
holder, may collect the fee for the next permit year and issue a
permit or permits for both periods, as applicable.
(g) A person issued a permit for a place of business that
permanently closes before the permit expiration date is not
entitled to a refund of the permit fee.
Sec. 155.058. REVENUE. (a) Except as provided by
Subsection (b), revenue from the sale of permits to interstate
warehouses, distributors, wholesalers, and bonded agents is
allocated in the same manner that other revenue is allocated by
Subchapter H.
(b) Revenue from the sale of retailer's permits shall be
deposited to the general revenue fund and may be appropriated only
as provided by this section. The money may be appropriated first to
the comptroller for administration of licensing of retailers under
this chapter or Chapter 154.
(c) If, after any appropriation is made under Subsection
(b), revenue remains from the sale of retailer's permits, the
remaining money may be appropriated to the comptroller for
administration and enforcement of Subchapters H, K, and N, Chapter
161, Health and Safety Code, and to the Texas Department of Health,
for the administration and enforcement of Section 161.253, Health
and Safety Code.
(d) If, after any appropriation is made under Subsections
(b) and (c), revenue remains from the sale of retailer's permits,
the remaining money may be appropriated to the Texas Department of
Health to administer the commissioner of public health's
responsibilities under Section 161.301, Health and Safety Code.
(e) If, after any appropriation is made under Subsections
(b), (c), and (d), revenue remains from the sale of retailer's
permits, the remaining money may be appropriated to the appropriate
entity to administer that entity's responsibilities under Section
161.302, Health and Safety Code.
Sec. 155.101. RECORD OF PURCHASE OR RECEIPT. Each
interstate warehouse, distributor, wholesaler, bonded agent, and
export warehouse shall keep records at each place of business of all
tobacco products purchased or received. Each retailer shall keep
records at a single commercial business location, which the
retailer shall designate as its principal place of business in the
state, of all tobacco products purchased and received. These
records must include the following, except that Subdivision (7)
applies to distributors only and Subdivision (8) applies only to
the purchase or receipt of tobacco products other than cigars:
(1) the name and address of the shipper or carrier and
the mode of transportation;
(2) all shipping records or copies of records,
including invoices, bills of lading, waybills, freight bills, and
express receipts;
(3) the date and the name of the place of origin of the
tobacco product shipment;
(4) the date and the name of the place of arrival of
the tobacco product shipment;
(5) a statement of the number, kind, and price paid for
the tobacco products;
(6) the name, address, permit number, and tax
identification number of the seller;
(7) the manufacturer's list price for the tobacco
products;
(8) the net weight as listed by the manufacturer for
each unit; and
(9) any other information required by rules of the
comptroller.
Sec. 155.102. REPORT OF SALE OR USE. (a) Each interstate
warehouse, distributor, and wholesaler shall keep at each place of
business in this state records of each sale, distribution,
exchange, or use of tobacco products whether taxed under this
chapter or not. Each interstate warehouse, distributor, and
wholesaler shall prepare and retain an original invoice for each
transaction involving tobacco products. Each interstate
warehouse, distributor, or wholesaler shall keep any supporting
documentation, including bills of lading, showing shipment and
receipt used in preparing the invoices at the place of business of
the distributor or wholesaler. The interstate warehouse,
distributor, or wholesaler shall prepare and deliver a duplicate
invoice to the purchaser.
(b) The records for each sale, distribution, exchange, or
use of tobacco products must show:
(1) the purchaser's name and address, permit number,
or tax identification number;
(2) the method of delivery and the name of the common
carrier or other person delivering the tobacco products;
(3) the date, amount, and type of tobacco products
sold, distributed, exchanged, or used;
(4) the price received for the tobacco products;
(5) the number and kind of tobacco products on which
the tax has been paid; and
(6) for sales from a manufacturer to a distributor or
interstate warehouse, the manufacturer's list price for the tobacco
products.
(c) In addition to the information required under
Subsection (b), the records for each sale, distribution, exchange,
or use of tobacco products other than cigars must show the net
weight as listed by the manufacturer for each unit.
(d) Upon request by the comptroller, each interstate
warehouse shall provide to the comptroller copies of periodic
tobacco product reports filed with each state into which the
interstate warehouse sells tobacco products and copies of the PACT
Act report required by 15 U.S.C. 376.
Sec. 155.201. PENALTIES. (a) A person violates this
chapter if the person:
(1) is a distributor, wholesaler, manufacturer,
export warehouse, importer, bonded agent, interstate warehouse,
manufacturer's representative, or retailer and fails to keep
records required by this chapter;
(2) engages in the business of a bonded agent,
interstate warehouse, distributor, wholesaler, manufacturer,
export warehouse, importer, or retailer without a valid permit;
(3) is a distributor, wholesaler, manufacturer, export
warehouse, importer, bonded agent, interstate warehouse, or
retailer and fails to make a report required by this chapter to the
comptroller or makes a false or incomplete report or application
required by this chapter to the comptroller; or
(4) is a person affected by this chapter and fails or
refuses to abide by or violates a provision of this chapter or a
rule adopted by the comptroller under this chapter.
(b) A person who violates this chapter shall pay to the
state a penalty of not more than $2,000 for each violation.
(c) A separate offense is committed each day on which a
violation occurs.
(d) The attorney general shall bring suits to recover
penalties under this section.
(e) A suit under this section may be brought in a court of
competent jurisdiction in Travis County or in any court having
jurisdiction.
Sec. 155.207. PERMITS. A person commits an offense if the
person acting:
(1) as a distributor, interstate warehouse,
wholesaler, or retailer, receives or possesses tobacco products
without having a valid permit;
(2) as a distributor, interstate warehouse,
wholesaler, or retailer, receives or possesses tobacco products
without having a permit posted where it can be easily seen by the
public;
(3) as a distributor, interstate warehouse, or
wholesaler, does not deliver an invoice to the purchaser as
required by Section 155.102;
(4) as a distributor, interstate warehouse,
wholesaler, or retailer, sells tobacco products without having a
valid permit; or
(5) as a bonded agent, interstate warehouse, or export
warehouse, stores, distributes, or delivers tobacco products on
which the tax has not been paid without having a valid permit.
SECTION 11. (a) Section 161.124, Health and Safety Code, is
repealed.
(b) The following provisions of the Tax Code are repealed:
(1) Section 154.1142;
(2) Section 154.1143;
(3) Section 155.0592; and
(4) Section 155.0593.
SECTION 12. Section 161.0901, Health and Safety Code, as
added by this Act, applies only to a violation that occurs on or
after the effective date of this Act. A violation that occurs
before the effective date of this Act is governed by the law in
effect on the date the violation occurred, and the former law is
continued in effect for that purpose.
SECTION 13. (a) Notwithstanding Section 147.0051, Health
and Safety Code, as added by this Act, a person is not required to
hold a permit under that section to engage in business as a retailer
of e-cigarettes in this state until January 1, 2022.
(b) The comptroller of public accounts shall prescribe the
form and content of an application for a permit under Section
147.0051, Health and Safety Code, as added by this Act, and begin
accepting applications for the permit not later than October 1,
2021.
SECTION 14. This Act takes effect September 1, 2021.