Frequently Asked Questions on Tobacco Tax
Tobacco tax is a tax imposed upon the consumer of tobacco products at the time of purchase. The Michigan Tobacco Products Tax Act PA 327 of 1993 as amended sets specific requirements for licensing, stamping, collecting and remittance of the tobacco taxes. The Act provides civil and criminal penalties for violations of the Tobacco Tax Act.
Who is required to file a tobacco tax return?
The Michigan Tobacco Products Tax Return, must be filed monthly by licensed wholesalers, manufacturers, secondary wholesalers and unclassified acquirers of both cigarettes and other tobacco products.
What is the Tobacco Tax Rate?
Effective July 1, 2004
- Cigarette tax rate - .10 per (10 cents) individual stick or $2.00 per pack of 20.
- Other Tobacco Products - Cigars, non-cigarette smoking tobacco and smokeless tobacco tax rate is 32% of the wholesale price which is the price charged by the manufacturer including the federal taxes before any discounts.
Effective November 1, 2012
- Premium Cigars - Cigars with a wholesale cost of $1.5625 or more per individual cigar are taxed at a rate of 50 cents per cigar. Cigars with a wholesale cost less than $1.5625 each are taxed at 32% of the wholesale price.
Are Blunts subject to tobacco tax?
Yes, they fall under other tobacco products (OTP) category and are subject to tobacco tax.
May I sell cigarettes and/or tobacco products from behind the counter of a bar, restaurant or hotel?
Yes, as long as the tobacco tax has been paid and the tobacco products are out of reach of minors.
How do I get an application?
The Application for a Tobacco Products Tax License, Form 336 is available on-line. You may also contact the Tobacco tax Unit at 517-636-4630.
What are the dates of the license year?
The license year runs from July 1st through June 30th and must be renewed every year. The application must be postmarked no later than June 30th.
How do I get a renewal application?
The Application/Renewal for a Tobacco Products Tax License, Form 336 is available on-line. You may also contact the Tobacco tax Unit at 517-636-4630.
Do I need a State of Michigan tobacco tax license to sell cigarettes in my bar, bowling alley, or store (i.e., convenience store, grocery store or party store?
You do not need a license, as long as you purchase all the cigarettes and other tobacco products from a wholesaler licensed with the State of Michigan who affixes the tobacco tax stamp to the cigarettes and remits the appropriate tax to the State.
How do I find out who is a wholesaler licensed with the State of Michigan?
You may contact the Michigan Distributors and Vendors Association at (517) 372-2323 or ask the wholesaler for a copy of their current State of Michigan tobacco tax license (not sales tax license).
I have a vending machine that dispenses tobacco products. Do I need to have a license to sell tobacco products?
Yes, the fee is $25.00 for the first vending machine and $6.25 for each additional vending machine. A current marker must be visibly placed on each vending machine.
Is there a limit to the number of vending machines that I may have under one license?
No. However, you must provide to the Michigan Department of Treasury a list of the business names and addresses where each vending machine is located. Include your business name and account number (FE, ME or TR) on the list. Vending machines must be placed in a location so that they can be monitored to prevent sales to minors.
When are the tax returns due?
Monthly Tobacco Tax returns are due on the 20th of each month following the reporting period. If the 20th of the month falls on a Saturday, Sunday or legal holiday, the next business day shall be considered the due date.
Monthly Tobacco Tax payments are due on the 20th of each month following the reporting period. If the 20th of the month falls on a Saturday, Sunday or legal holiday, the prior business day shall be considered the due date. If payment is not postmarked or received by the due date, penalty and interest charges may be assessed based on provisions of the Michigan Revenue Act MCL 205.24. Check with your financial institution about their specific ACH requirements. Some banks require the ACH debit request by 4:00 PM on the business day before the due date in order to assure ACH transfer of the funds on the due date.
Is the reporting of total ounces mandatory on the tobacco taxes return?
Yes, only for Roll-your-own Non-Participating Manufacturer products.
Is the reporting brand information required for Participating Manufacturer Tobacco Products?
No, brand information is only required for Non-Participating Manufacturer products.
How do I contact the Tobacco Tax Unit?
You may contact the Tobacco Tax Unit by:
- Phone: 517-636-4630
- Fax: 517-636-4631
- Mail: Tobacco Unit, Michigan Department of Treasury, P.O. Box 30474, Lansing, MI 48909-7974
- E-mail: email@example.com