Senate Bill 2536

AN ACT TO AMEND SECTIONS 27-69-13 AND 27-69-75, MISSISSIPPI CODE OF 1972, TO INCREASE THE EXCISE TAX ON CIGARETTES, TO CREATE THE "MEDICAID PROGRAM TOBACCO CESSATION FUND" AND TO DEDICATE THE SAID CIGARETTE EXCISE TAX INCREASE FOR THE PURPOSE OF FUNDING ANY MEDICAID DEFICIT WITH ANY EXCESS TO BE APPLIED TO THE ADMINISTRATION OF THE MEDICAID PROGRAM AND TO TOBACCO CESSATION PROGRAMS; AND FOR RELATED PURPOSES.

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

SECTION 1. Section 27-69-13, Mississippi Code of 1972, is amended as follows:

27-69-13. (1) There is hereby imposed, levied and assessed, to be collected and paid as hereinafter provided in this chapter, an excise tax on each person or dealer in cigarettes, cigars, stogies, snuff, chewing tobacco, and smoking tobacco, or substitutes therefor, upon the sale, use, consumption, handling or distribution in the State of Mississippi, as follows:

(a) On cigarettes, the rate of tax shall be * * *~~Three and Four‑tenths Cents (3.4¢)~~ Ten and Nine-tenths Cents (10.9¢) on each cigarette sold with a maximum length of one hundred twenty (120) millimeters; any cigarette in excess of this length shall be taxed as if it were two (2) or more cigarettes. Provided, however, if the federal tax rate on cigarettes in effect on June 1, 1985, is reduced, then the rate as provided herein shall be increased by the amount of the federal tax reduction. Such tax increase shall take effect on the first day of the month following the effective date of such reduction in the federal tax rate.

(b) On cigars, cheroots, stogies, snuff, chewing and smoking tobacco and all other tobacco products except cigarettes, the rate of tax shall be fifteen percent (15%) of the manufacturer's list price.

No stamp evidencing the tax herein levied on cigarettes shall be of a denomination of less than One Cent (1¢), and whenever the tax computed at the rates herein prescribed on cigarettes shall be a specified amount, plus a fractional part of One Cent (1¢), the package shall be stamped for the next full cent; however, the additional face value of stamps purchased to comply with taxes imposed by this section after June 1, 1985, shall be subject to a four percent (4%) discount or compensation to dealers for their services rather than the eight percent (8%) discount or compensation allowed by Section 27-69-31.

Every wholesaler shall purchase stamps as provided in this chapter, and affix the same to all packages of cigarettes handled by him as herein provided.

The above tax is levied upon the sale, use, gift, possession or consumption of tobacco within the State of Mississippi, and the impact of the tax levied by this chapter is hereby declared to be on the vendee, user, consumer or possessor of tobacco in this state; and when said tax is paid by any other person, such payment shall be considered as an advance payment and shall thereafter be added to the price of the tobacco and recovered from the ultimate consumer or user.

(2) There is created in the State Treasury a special fund, separate and apart from any other fund, to be designated the "Medicaid Program Tobacco Cessation Fund." From the gross amount of the Ten and Nine-tenths Cents (10.9¢) excise tax levied under subsection (1)(a), there shall be deducted Seven and Five-tenths Cents (7.5¢) to be paid into the Medicaid Program Tobacco Cessation Fund created under this subsection (2). The payments shall be made by the Department of Revenue into the Medicaid Program Tobacco Cessation Fund.

(3) The Medicaid Program Tobacco Cessation Fund shall be used in the following priority:

(a) To provide funds to be applied to the current deficit, if any, in the Medicaid program as certified by the Department of Finance and Administration, subject to appropriation by the Legislature;

(b) To provide funds for the administration of the Medicaid program which are part of the deficit in the Medicaid program as certified by the Department of Finance and Administration, subject to appropriation by the Legislature; and

(c) Any funds appropriated from the Medicaid Program Tobacco Cessation Fund that are unexpended at the end of a fiscal year shall not lapse into the State General Fund, and shall be expended to defray the cost of tobacco cessation programs authorized by law.

(4) The Division of Medicaid, Office of the Governor, shall make application to the federal Centers for Medicare and Medicaid Services in order to apply the cigarette tax increase dedicated to the Medicaid program under this section as a state contribution for applicable federal Medicaid match. The Department of Finance and Administration shall send notice of any transfers made, or other action taken under authority of this section, to the Legislative Budget Office.

SECTION 2. Section 27-69-75, Mississippi Code of 1972, is amended as follows:

27-69-75. (1) All taxes levied by this chapter shall be payable to the commissioner in cash, or by personal check, cashier's check, bank exchange, post office money order or express money order, and shall be deposited by the commissioner in the State Treasury on the same day collected. No remittance other than cash shall be a final discharge of liability for the tax herein assessed and levied, unless and until it has been paid in cash to the commissioner.

(2) Taxes levied and collected under this chapter shall be deposited to the State Treasury as follows:

(a) All tobacco taxes collected, including tobacco license taxes, shall be deposited into the State Treasury to the credit of the General Fund * * *., less than and except Seven and Five-tenths Cents (7.5¢) per cigarette levied by authority of Section 27-69-13(1)(a);

(b) Seven and Five-tenths Cents (7.5¢) per cigarette levied by authority of Section 27-69-13(1)(a) to be deposited to the "Medicaid Program Tobacco Cessation Fund" created in Section 27-69-13(2).

(3) Wholesalers who are entitled to purchase stamps at a discount, as provided by Section 27-69-31, may have consigned to them, without advance payment, such stamps, if and when such wholesaler shall give to the commissioner a good and sufficient bond executed by some surety company authorized to do business in this state, conditioned to secure the payment for the stamps so consigned. The commissioner shall require payment for such stamps not later than thirty (30) days from the date the stamps were consigned.

SECTION 3. This act shall take effect and be in force from and after July 1, 2019.