Taxes are due by the 20th of the month after you receive your cigarettes. Use Form 514 to report the tax due.
Oregon licensed distributors purchase stamps from the Department of Revenue. A machine heats the stamps, and sticks them to the packs. The machine opens the cartons, applies the stamp, then reseals the cartons.
There is a federal law called the Jenkins Act that requires all interstate sales of cigarettes to be reported to the Department of Revenue of the state to which the product has been shipped. Under the Jenkins Act, internet retailers report the names and addresses of each person buying cigarettes from that retailer. We also have discovered names and addresses of internet purchasers during investigations done by Oregon's Tobacco Tax Program.
Buying cigarettes over the internet or by mail order is not illegal. However, it is illegal to be in possession of untaxed cigarettes in Oregon. All cigarettes, regardless of how or where they are purchased, must have the tax paid. The consumer is ultimately responsible for the tax. Look on the bottom of each pack. If there is a small Oregon stamp, Oregon tax has been paid. If there is no stamp, then the cigarettes are "illegal" because they have not been taxed. If the stamp on the bottom of the pack does not have "Oregon" on it, then the tax has been paid to another state and is considered unstamped for purposes of taxation in Oregon.
Oregon law will allow you to bring up to 199 cigarettes into the state without requiring them to be taxed by Oregon. However, Oregon will tax ALL cigarettes you bring into the state if you bring more than 199. For example, if you bring one full carton of cigarettes (200 cigarettes) and one carton with 199 cigarettes into Oregon, you would need to pay the tax on 399 cigarettes to the Department of Revenue
The stamp is wax. Each pack must have a stamp. Each state uses its own tax stamp design. Colors and markings on each state's stamps are different.
Most internet sites do not comply with Oregon statute (ORS 323.700-323.730) regarding tobacco sales. This law requires all remote sellers of cigarettes or other tobacco products to
- Verify the age of the purchaser;
- Be a licensed distributor;
- Report sales to the Oregon Department of Revenue; and
- Show proof of tax paid.
Each pack must have an Oregon stamp because the stamps show that the tax for each pack of cigarettes has been paid.