The bill proposes an increase in the tax on cigarettes from $1.70 to $2.70 per package containing 20 cigarettes, as outlined in the amendment to Section 16-11-111 of the Montana Code Annotated (MCA). This change mandates that the tax be precollected by wholesalers and paid to the state. Additionally, the bill clarifies that the tax applies to illegally packaged cigarettes and specifies that the tax does not apply to quota cigarettes. It also establishes a system for wholesalers to apply for refunds or credits for taxes precollected on cigarettes sold to tribal members on Montana Indian reservations, contingent upon meeting certain quota requirements.

Furthermore, the bill maintains existing provisions regarding the taxation of other tobacco products, including a 50% tax on the wholesale price of tobacco products other than cigarettes, and sets specific tax rates for premium cigars and moist snuff. It emphasizes the responsibilities of wholesalers and retailers in reporting and paying the applicable taxes, including penalties for non-compliance. Overall, the bill aims to revise the taxation framework for cigarettes and tobacco products in Montana, with a focus on ensuring proper tax collection and compliance.

Statutes affected:
LC Text: 16-11-111