Prevent All Cigarette Trafficking (PACT) Act FAQs

The PACT Act is a federal law that imposes certain reporting requirements on persons who ship or sell tobacco products across state lines. If you are a person shipping or selling tobacco products into Michigan, please read the Frequently Asked Questions below concerning your PACT Act responsibilities.

FAQs - Prevent All Cigarette Trafficking (PACT) Act

The following FAQs summarize and address various aspects of the PACT Act, a federal law that amended the federal Jenkins Act (15 U.S.C. §§375 to 378, inclusive) on June 29, 2010 that pertains to registration and reporting requirements to the Michigan Department of Treasury (Department). The PACT Act also establishes other requirements for compliance with federal authorities, such as registration with the federal Bureau of Alcohol, Tobacco, Firearms, and Explosives (BATFE), which are not generally addressed here.

The PACT Act's definition of a "cigarette" was recently amended by the federal Preventing Online Sales of E-Cigarettes Act (POSECA) which is effective March 27, 2021. As amended by the POSECA, a "cigarette" under the PACT Act will include an Electronic Nicotine Device System (ENDS).

In recognition of this amendment, the Department has modified all PACT Act reporting forms and made those forms available on its website at: www.michigan.gov/tobaccotaxes. These new reporting forms must be used for filing dates beginning on and after April 10, 2021.

For more information on the recent changes to the PACT Act please refer to the Department's April 1, 2021 PACT ACT Notice: PACT ACT NOTICE

I, Frequently Asked Questions about your PACT Act Responsibilities

1. What is the PACT Act?

The PACT Act is a federal law that went into effect June 29, 2010. The PACT Act amended provisions of the Jenkins Act (15 U.S.C. §§ 375 - 378) and the Contraband Cigarette Trafficking Act (18 U.S.C. §§ 2341-2346). Key features of the PACT Act include restrictions on mailing cigarettes and smokeless tobacco products to consumers through the U.S. Postal Service; requirements for registration, reporting, delivery, and recordkeeping; and sanctions for noncompliance. The PACT Act imposes the following two reporting requirements on all persons, including manufacturers, who sell, transfer, ship, advertise, or offer to sell cigarettes or smokeless tobacco into Michigan:

The first requirement concerns initial registration.
The second is a monthly reporting requirement.

Both the registration and the monthly reports must be filed with the Michigan Department of Treasury, Tobacco Tax Enforcement Unit.

In addition, those selling cigarettes and smokeless tobacco products are required to:

Pay all applicable federal, state, local or tribal tobacco taxes and affix cigarette tax stamps before delivering any products to any customer.
Check the age and ID of customers at the time of purchase and when the tobacco products are delivered.

2. Does the PACT Act affect me?

If you sell, transfer, or ship for profit "cigarettes" or "smokeless tobacco", as those terms are defined in the PACT Act, into Michigan or advertise or offer cigarettes or smokeless tobacco for sale, transfer, or shipment into Michigan you must comply with PACT Act unless an exclusion applies. For "delivery sales," as defined in the PACT Act, additional requirements apply such as those under 15 U.S.C. §376a.

3. What qualifies as a "cigarette" under the PACT ACT?

A "cigarette" for purposes of the PACT Act is any of the following:

a. Any roll of tobacco wrapped in paper or in any substance not containing tobacco;

b. Any roll of tobacco wrapped in any substance containing tobacco which, because of its appearance, the type of tobacco used in the filler, or its packaging and labeling, is likely to be offered to, or purchased by, consumers as a cigarette described in (a) above;

c. Roll-your-own-tobacco;

d. Effective March 27, 2021, an Electronic Nicotine Delivery System (ENDS). ENDS means any electronic device that through an aerosolized solution, delivers nicotine, flavor, or any other substance to the user inhaling from the device. This includes:

(i) an e-cigarette;

(ii) an e-hookah;

(iii) an e-cigar;

(iv) a vape pen;

(v) an advanced refillable personal vaporizer;

(vi) an electronic pipe; and

(vii) any component, liquid, part, or accessory of a device described in above.

A "cigarette" for purposes of the PACT ACT does not include a "cigar" as defined in 26 U.S.C. §5702. This exclusion does not pertain to products commonly referred to as "little cigars."

4. Does the PACT Act affect me?

The PACT ACT defines "smokeless tobacco" as any finely cut, ground, powdered, or leaf tobacco, or other product containing tobacco, that is intended to be placed in the oral or nasal cavity or otherwise consumed without being combusted. Examples of smokeless tobacco include chewing tobacco, snuff, and snus.

5. Who is a "delivery seller" and what is a "delivery sale" under the PACT Act?

A "delivery seller" is a person who makes a delivery sale. A "delivery sale" means any sale of cigarettes or smokeless tobacco to a consumer if--

(a) the consumer submits the order for the sale by means of a telephone or other method of voice transmission, the mail, or the Internet or other online service, or the seller is otherwise not in the physical presence of the buyer when the request for purchase or order is made; or

(b) the cigarettes or smokeless tobacco are delivered to the buyer by common carrier, private delivery service, or other method of remote delivery, or the seller is not in the physical presence of the buyer when the buyer obtains possession of the cigarettes or smokeless tobacco.

6. Does the PACT Act restrict the mailing of tobacco products?

The PACT Act prohibits mailing cigarettes and smokeless tobacco through the U.S. Postal Service and requires those selling cigarettes and smokeless tobacco products into Michigan to:

Register with and make monthly reports to Michigan, Department of Treasury Tobacco Tax Enforcement Unit.
Pay all federal, state, or tribal tobacco taxes and affix cigarette tax stamps before delivering any products to any customer or acquiring Michigan tax-paid products from a Michigan licensed cigarette wholesaler or tobacco distributor.
Check the age and ID of customers at the time of purchase and when the tobacco products are delivered.

7. I am an out-of-state distributor that advertises for sale or sells cigarettes and smokeless tobacco products to Michigan licensed wholesalers and unclassified acquirers, do I have to do anything to comply with the PACT Act?

Yes, if you ship/transfer/sell cigarettes and smokeless tobacco products into Michigan or you advertise these products for sale in Michigan you must comply with the PACT Act and register with the BATFE and the Department and submit a monthly PACT Act report(s) to the Department.

8. How do I register with the Department to comply with the PACT Act?

If you operate a business for profit that sells, transfers, or ships cigarettes or smokeless tobacco for interstate commerce into Michigan, or advertises these products for sale in Michigan, you must register with the BATFE and the State of Michigan and submit a monthly sales report(s).

Use the federal PACT Act Registration (ATF Form 5070.1) to register your business to comply with the PACT Act and forward a copy of this form to the Michigan Department of Treasury, Tobacco Tax Enforcement Unit, P.O. Box 30140 Lansing, MI 48909.

*Be sure to include your business FEIN or business ID number on any registration correspondence.

If you're a delivery seller, you must apply for a Michigan cigarette/other tobacco products tax license if you plan to sell cigarettes or smokeless tobacco in Michigan. Go to www.michigan.govtobacco/taxes to apply for a Michigan Tobacco License.

If you have questions about registering for the PACT Act or about cigarette or tobacco tax, call the Tobacco Tax Enforcement Unit at (517) 636-0680 or email Treas_Tobacco_Tax_Enforcement@Michigan.gov. You can mail the registration to the Michigan Department of Treasury, Tobacco Tax Enforcement Unit, P.O. Box 30140 Lansing, MI 48909.

9. What must I include with my monthly report to the Department?

A memorandum or a copy of the invoice covering each and every shipment of cigarettes or smokeless tobacco made during the previous calendar month into Michigan. The memorandum or invoice information must be organized by customer's city or town, and by ZIP code, and include:

the name and address of the person to whom the shipment was made;
the brand, quantity, weight or volume, and price of the cigarettes or smokeless tobacco shipped into Michigan; and
the name, address, and telephone number of the person delivering the shipment to the recipient on behalf of the delivery seller

The Department suggests using the Michigan Motor Fuel and Tobacco System (MiMATS) to submit the data. You may also submit them to the Tobacco Enforcement Unit by emailing the data as an attachment to Treas_Tobacco_Tax_Enforcement@Michigan.gov. Standard file formats such as Excel, PDF, Word or Text are recommended.

Additionally, Monthly PACT ACT Reports are available, see forms below.

10. When are my monthly reports to the Department due?

On or before the 10th day of each calendar month to cover shipments made during the previous calendar month.

II. PACT Act Forms

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Prevent All Cigarette Trafficking (PACT) Act FAQs