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Tobacco tax overview

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You can now view and manage your account information electronically using Revenue Online. You can make payments; view payment details, account balances, reports and/or notices; and submit returns through Revenue Online. This service offers convenient access that is available any time of day.
> Learn about Revenue Online services for cigarette and tobacco taxpayers.
> Read Revenue Online frequently asked questions.

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Introduction


State laws define "tobacco products."
"'Tobacco products" mean cigars, cheroots, stogies, periques, granulated, plug cut, crimp cut, ready rubbed and other smoking tobacco, snuff, snuff flour, moist snuff, cavendish, plug and twist tobacco; fine cut and other chewing tobaccos, shorts, refuse scraps, clippings, cuttings and sweepings of tobacco and other kinds and forms of tobacco, prepared in such manner as to be suitable for chewing or smoking in a pipe or otherwise, or both for chewing and smoking, but shall not include cigarettes as defined in ORS 323.010."  (ORS 323.500)

"Moist Snuff" is any finely cut, ground, milled, or powdered tobacco product that is not intended to be smoked or placed in the nasal cavity. Moist Snuff also includes any product containing tobacco which is not intended to be burned when consumed. Examples include items such as chewing tobacco, lozenges, strips, and sticks. It does not include things like cigarettes, roll-your-own tobacco, pipe tobacco or cigars.
(ORS 323.500)

The Oregon tobacco tax rates are discussed at ORS 323.505. The current rates are outlined below:
  • Cigars – 65 percent of the wholesale sales price, except that the maximum tax is limited to $0.50 per cigar.
  • Moist Snuff – $1.78 per ounce, except that the minimum tax per retail container is $2.14. 
  • All Other Tobacco Products 65 percent of the wholesale sales price paid. 


 
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Responsibilities and requirements


Any individual or business that obtains untaxed tobacco products for distribution, sale, or use in Oregon must file a return with the Department of Revenue (DOR) and pay the tax on tobacco products. This includes distributors, manufacturers, and non-licensed businesses and consumers.

NEW: you can complete and submit your tax return electronically using Revenue Online.

Distributors

Licensed distributors must file an Oregon Quarterly Tax Return for Tobacco Distributors (Form 530) with applicable supporting schedules, even if there is no activity during the reporting period.

We may require distributors to post security in the form of a surety bond to ensure compliance with the tobacco tax laws. If a bond is required, you must complete an Oregon Other Tobacco Products Tax Bond form.


Manufacturers
As a tobacco product manufacturer, you must file an Oregon Quarterly Tax Return for Manufacturers Distributing Nonexempt Tobacco Products (Form 532) for each quarter that you distribute non-exempt tobacco products in Oregon. Payment of the tax must be made with the return.


Retailers
As a retailer, you must purchase tobacco products from licensed Oregon distributors who have paid the tax. If you wish to purchase untaxed tobacco products for resale to customers in Oregon, you must apply for a distributor's license.

Click here for a list of the currently licensed Oregon distributors.


Consumers

If you purchase untaxed tobacco products you are responsible for paying the tax. You must file an Oregon Quarterly Tax Return for Consumer's Tobacco Products (Form 531), including all schedules, for every quarter you purchase untaxed tobacco products. Payment of the tax must be made with the return. Returns must be filed by the last day of the month following any calendar quarter that you purchase untaxed tobacco products. You cannot resell untaxed other tobacco products, even if you have filed form 531 and paid the tax.


Transporters
Transporters must apply for a Permit for Transportation of Untaxed Tobacco Products to possess, acquire for transportation, or transport untaxed tobacco products in Oregon.

NEW: you can complete and submit an application for a Permit for Transportation of Untaxed Tobacco Products electronically using Revenue Online.

Transporters must carry the permit and the invoices or bills of lading covering the shipment in the vehicle during transport. (ORS 323.570)


 
 
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Distributor License
 


You must obtain an Oregon Distributor License before distributing tobacco products in Oregon. The licensing process is:
  1. Submit a license application to DOR.
  2. We will review your application and may request additional information before issuing you a license.
  3. After we have approved your application, we will issue you a license. You must display the license where it can be easily seen at the business location designated on the license.
Distributor licenses are not transferable. Distributors must be licensed for each location where they offer tobacco products for sale.


NEW: you can complete and submit an application for a Distributor's License electronically using Revenue Online. 

 
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Records

State law requires every distributor, retailer, and any other person or business dealing in, transporting, or storing tobacco products to keep invoices of other tobacco products for five years. "***The invoices shall show the name and address of the seller and the date of purchase. Invoices shall be available for inspection by DOR or its authorized agents or employees***" (ORS 323.540).

Read more information about the inspection process.


 

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Penalty and interest
A penalty will be charged equal to 5 percent of the amount due for any failure to file a report or return or pay the tax by the due date. If the amount due is not paid within 30 days, an additional penalty of 20 percent will be charged.

Interest will be added to any unpaid amount, figured from the time the tax becomes due. Interest will be at the rate established under Oregon law.

Additionally, violations of the tobacco tax laws may be subject to a civil penalty of up to $1,000 per violation.

 
 
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Contact the tobacco tax program


Phone: (503) 947-2279 or ​(503) 945-8120
Tip line: ​(503) 947-2106 (Salem)
(866) 840-2740 (toll-free from Oregon prefix)
Mailing address: ​Other Tobacco Products Tax
Oregon Department of Revenue
PO Box 14630
Salem, OR 97309-5050
 

Tobacco taxpayers can now manage tax account information online with Revenue Online - click here to get started