California has various requirements in order to sell tobacco products to a person in the state over the internet, on the phone or via any other non-“face-to-face” sales method. The delivery seller may be required to report to the Attorney General its delivery sales of cigarettes and tobacco products to California consumers. Cigars are excluded from this law.
In addition, the federal PACT Act requires any person who sells, transfers, or ships cigarettes, roll-your-own tobacco, and smokeless tobacco into a state to register with the tobacco tax administrator of the state. The federal PACT Act requires delivery sellers to comply with shipping requirements.
California requires any person selling or distributing tobacco products to verify that the purchaser or recipient of the product is 18 years or older. The requirements include, but are not limited to receiving the date of birth, name and address of the purchaser. If the seller or distributor is unable to verify the age, the customer shall be required to submit an age-verification kit. These requirements are found the in the Stop Tobacco Access to Kids Enforcement Act. In addition, the federal PACT Act age verification requirements for the shipping of cigarettes, roll-your-own tobacco, and smokeless tobacco products apply.
California imposes a Cigarette and Tobacco Products Surtax on every distributor of tobacco products in the state. The tax is based on the wholesale cost of the products, at a rate determined annually by the State Board of Equalization (“BOE”). “Wholesale cost” means the cost of tobacco products to the distributor prior to any discounts or trade allowances and includes all manufacturing costs, the cost of raw materials, the cost of labor, any direct and indirect overhead costs, the wholesale markup, and any federal excise and U.S. Custom’s taxes paid.
The state tobacco products tax is in lieu of all other state, county, municipal, or district taxes on the privilege of distributing tobacco products. California requires an excise tax on tobacco products which is in addition to the sales and use taxes.
In California, shipping charges are taxable if shipped by the retailer. The tax does not apply to “separately stated” charges on the invoice for transportation of property. Staff confirmed that this regulation would apply to the shipping of tobacco products.
In California, every distributor is required to pay a tax on their distributions of cigarettes at rates set in statute. This tax applies to other tobacco products except cigars which are excluded from requirements that are specific to the mail order/internet cigarette taxes.