Senate Bill 2806

AN ACT TO AMEND SECTION 27-70-3, MISSISSIPPI CODE OF 1972, TO REVISE THE DEFINITION OF THE TERM "TOBACCO SETTLEMENT AGREEMENT" IN THE LAW THAT IMPOSES A FEE ON CIGARETTE MANUFACTURERS THAT DID NOT SIGN A TOBACCO SETTLEMENT AGREEMENT; TO AMEND SECTION 27-70-5, MISSISSIPPI CODE OF 1972, TO DELETE THE PROVISION THAT IMPOSES THE FEE ON CIGARETTES SOLD, PURCHASED OR OTHERWISE DISTRIBUTED IN THIS STATE FOR SALE OUTSIDE OF THIS STATE; TO AMEND SECTION 27-70-19, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT FOR A PERIOD OF 90 DAYS FROM THE DATE THAT A NONSETTLING MANUFACTURER DOES NOT APPEAR IN THE DIRECTORY THAT THE ATTORNEY GENERAL IS REQUIRED TO MAINTAIN, A DISTRIBUTOR MAY CONTINUE TO STAMP AND SELL THE CIGARETTES OF THE NONSETTLING MANUFACTURER REMOVED FROM THE DIRECTORY THAT WERE PURCHASED BEFORE THE REMOVAL; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 27-70-3, Mississippi Code of 1972, is amended as follows:

27-70-3. As used in this chapter:

(a) "Brand family" means each style of cigarettes sold under the same trademark and differentiated from one another by means of additional modifiers, including "menthol," "lights," "kings" and "100s." The term includes any style of cigarette products that have a brand name, trademark, logo, symbol, motto, selling message, recognizable pattern of colors, or other indication of product identification that is identical to, similar to, or identifiable with a previously known brand of cigarettes.

(b) "Cigarette" means any product that contains nicotine and is intended to be burned or heated under ordinary conditions of use. The term includes:

(i) A roll of tobacco wrapped in paper or another substance that does not contain tobacco;

(ii) Tobacco, in any form, that is functional in a product that, because of the product's appearance, the type of tobacco used in the filler, or the product's packaging and labeling, is likely to be offered to or purchased by a consumer as a cigarette; or

(iii) A roll of tobacco wrapped in any substance containing tobacco that, because of the product's appearance, the type of tobacco used in the filler, or the product's packaging and labeling, is likely to be offered to or purchased by a consumer as a cigarette.

(c) "Commissioner" means the Chairman of the State Tax Commission and his authorized agents and employees. From and after July 1, 2010, "commissioner" shall mean Commissioner of Revenue of the Department of Revenue.

(d) "Mail" means placing the document or item referred to in first-class United States mail, postage prepaid, addressed to the person to whom the document or item is to be sent at the last known address of that person.

(e) "Manufacturer" means a person that manufactures, fabricates or assembles cigarettes for sale or distribution. For purposes of this chapter, the term includes a person that is the first importer into the United States of cigarettes manufactured outside the United States.

(f) "Master settlement agreement" means the settlement agreement and related documents entered into in 1998 by forty-six (46) states and leading United States tobacco manufacturers.

(g) "Nonsettling manufacturer" means a manufacturer of cigarettes that did not sign a tobacco settlement agreement.

(h) "Nonsettling-manufacturer cigarettes" means cigarettes manufactured, fabricated, assembled or imported by a nonsettling manufacturer.

(i) "Nonsettling-manufacturer cigarette tobacco products" means cigarette tobacco products manufactured, fabricated, assembled or imported by a nonsettling manufacturer.

(j) "Tobacco settlement agreement" means the Comprehensive Settlement Agreement and Release filed December 29, 1997, in the Chancery Court of Jackson County, State of Mississippi, in the case of Mike Moore, Attorney General, ex rel. State of Mississippi Tobacco Litigation * * *, Cause No. 94-1429, and all subsequent amendments thereto.

(k) "Distributor" shall have the same meaning ascribed to that term in Section 27-69-3.

SECTION 2. Section 27-70-5, Mississippi Code of 1972, is amended as follows:

27-70-5. (1) A fee is imposed on the sale, use, consumption or distribution in this state of:

(a) Nonsettling-manufacturer cigarettes if a stamp is required to be affixed to a package of those cigarettes under the Tobacco Tax Law; and

(b) Nonsettling-manufacturer cigarettes that are sold, purchased or distributed in this state but that are not required to have a stamp affixed to a package of those cigarettes under the Tobacco Tax Law * * *.

(2) The fee imposed by this chapter does not apply to cigarettes that are included in computing payments due to be made by a settling manufacturer under the tobacco settlement agreement.

(3) The fee imposed by this chapter is in addition to any other privilege, license, fee or tax required or imposed by state law.

(4) Except as otherwise provided by this chapter, the fee imposed by this chapter is imposed, collected, paid, administered and enforced in the same manner, taking into account that the fee is imposed on nonsettling manufacturers, as the taxes imposed by the Tobacco Tax Law, as appropriate.

SECTION 3. Section 27-70-19, Mississippi Code of 1972, is amended as follows:

27-70-19. (1) Cigarettes of a nonsettling manufacturer that has not complied with this chapter, including full payment of the fee imposed by this chapter, shall be treated as tobacco for which the tax assessed by the Tobacco Tax Law has not been paid, and the manufacturer is subject to all penalties imposed by that act for violations of that act.

(2) The commissioner shall provide to a nonsettling manufacturer, each distributor authorized to affix tax stamps pursuant to the Tobacco Tax Law and to the Attorney General a notice of noncompliance with this chapter if the manufacturer:

(a) Does not pay in full the fee imposed by this chapter; or

(b) Is not included on the list described by Section 27-70-13(2).

(3) Except as otherwise provided in this section, if a nonsettling manufacturer does not appear in the Attorney General's directory required by Section 27-70-13(2), or upon receipt of the notice of noncompliance described in subsection (2) of this section with respect to a nonsettling manufacturer, no distributor may, with respect to cigarettes manufactured by such nonsettling manufacturer:

(a) Pay the tax imposed by the Tobacco Tax Law;

(b) Affix to a package of cigarettes the stamp required by Section 27-69-15; or

(4) If subsequent to the issuance of the notice of noncompliance provided in subsection (2) of this section, the commissioner determines that the nonsettling manufacturer which is the subject of the notice comes into full compliance with this chapter, the commissioner shall provide to the nonsettling manufacturer, each distributor authorized to affix tax stamps pursuant to the Tobacco Tax Law and the Attorney General notice that this nonsettling manufacturer has returned to compliance under this chapter.

(5) For a period of ninety (90) days from the date that a nonsettling manufacturer does not appear in the Attorney General's directory required by Section 27-70-13(2), a distributor may continue to stamp and sell the cigarettes of the nonsettling manufacturer removed from the directory that were purchased before the removal.

SECTION 4. This act shall take effect and be in force from and after July 1, 2010.