WEST VIRGINIA LEGISLATURE
2024 REGULAR SESSION
Introduced House Bill 5535
By Delegates Hornby, Chiarelli, Willis, Dean, Bridges,
Rohrbach, Hite, and Heckert [Introduced February 09, 2024; Referred to the Committee on Health and Human Resources then Finance]
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1 A BILL to amend and reenact §11-17-2, §11-17-3, §11-17-4b, and §11-17-17 of the Code of West
2 Virginia, 1931, as amended, all relating to applying an excise tax to e-cigarettes and other
3 heated nicotine products from the tobacco excise tax.
Be it enacted by the Legislature of West Virginia:
ARTICLE 17. TOBACCO PRODUCTS EXCISE TAX ACT.
§11-17-2. Definitions.
1 (a) When used in this article, words, terms and phrases defined in subsection (b) of this
2 section, and any variations thereof required by the context, have the meaning ascribed to them in
3 this section, except where the context indicates a different meaning is intended.
4 (b) Definitions. --
5 (1) "Cigarette" means:
6 (A) Any roll for smoking made, wholly or in part, of tobacco, irrespective of size or shape
7 and whether or not the tobacco is flavored, adulterated or mixed with any ingredient, the wrapping
8 or cover of which is made of paper or any substance or material, except tobacco.
9 (B) Any roll of tobacco wrapped in any substance containing tobacco which, because of its
10 appearance, the type of tobacco used in the filler, or its packing and labeling, is likely to be offered
11 to, or purchased by, consumers as a cigarette described in paragraph (A) of this subdivision.
12 (C) "Cigarette", for tax purposes, does not include a "heated tobacco product", "heated
13 nicotine product" "e-cigarette" or "e-cigarette liquid" as defined herein.
14 (2) "Commissioner" means the State Tax Commissioner and, where the meaning of the
15 context requires, all deputies or agents and employees duly authorized by him or her.
16 (3) "Consumer" means a person who receives or in any way comes into possession of
17 tobacco products for the purpose of consuming or giving them away or disposing of them in any
18 way other than by sale, barter or exchange.
19 (4) "Counterfeit stamp" means any stamp, label or print, indicium or character, that
20 evidences, or purports to evidence, the payment of any tax levied under this article and that has
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21 not been printed, manufactured or made by authority of the commissioner, as provided in this
22 article, and has not been issued, sold or circulated by the commissioner.
23 (5) "Heated tobacco product" means a product containing tobacco that produces an
24 inhalable aerosol (i) by heating the tobacco by means of a device without combustion of the
25 tobacco or (ii) by heat generated from a combustion source that only or primarily heats rather than
26 burns the tobacco.
27 (6) "Heated nicotine product" means a product that does not contain tobacco but does
28 contain nicotine in solid or semi-solid form and not in a solution or liquid form that that produces an
29 inhalable aerosol (i) by heating the tobacco by means of a device without combustion of the
30 tobacco or (ii) by heat generated from a combustion source that only or primarily heats rather than
31 burns the tobacco;
32 (5) (7) "Manufacturer" means a person who manufactures or produces a tobacco product.
33 (8) "Nicotine product" means any a "heated nicotine product", a "(oral/alternative/modern)
34 nicotine product" or "E-cigarette liquid" that contains nicotine and does not contain tobacco.
35 (9) "(Oral/Alternative/Modern) Nicotine Product" means any noncombustible product
36 containing nicotine that does not contain tobacco and that is intended for human consumption or
37 placement in the oral cavity for absorption into the human body by any means other than
38 inhalation. Oral nicotine products are not a substitute for tobacco nor is any oral nicotine product
39 included in the definition of any other tobacco product, vapor product, cigarette, or any product
40 regulated as a drug or device by the United States Food and Drug Administration under Chapter V
41 of the Food, Drug, and Cosmetic Act.
42 (6)(10) "Other tobacco product" or "tobacco products other than cigarettes" means snuff
43 and chewing tobacco and any other tobacco product that is intended by the seller to be consumed
44 by means other than smoking and any cigar, pipe tobacco or other tobacco product other than
45 cigarettes.
46 "Other tobacco product" or "tobacco products other than cigarettes" for tax purposes, does
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47 not include a "heated tobacco product", a "heated nicotine product" or a "(oral/alternative/modern)
48 nicotine product" as defined herein.
49 (7) (11) "Package" means the individual package, box or other container in or from which
50 retail sales of tobacco products are normally made or intended to be made.
51 (8) (12) "Person" means and includes any individual, firm, association, company,
52 partnership, corporation, joint-stock company, club, agency, syndicate, limited liability company,
53 other legal entity, municipal corporation or other political subdivision of this state, trust, receiver,
54 trustee, fiduciary or conservator, and when used in connection with any penalties imposed by this
55 article, means and includes officers, directors, trustees or members of any firm, copartnership,
56 association, corporation, trust or any other unit acting as a group.
57 (9) (13) "Place of business" means a place where a tobacco product is sold or where a
58 tobacco product is brought or kept for the purpose of sale or consumption, including a vessel,
59 airplane, train or vending machine.
60 (10) (14) "Retail dealer" includes every person in this state, other than a wholesaler or
61 subjobber, engaged in the selling of tobacco products at retail to a consumer or to any person for
62 any purpose other than resale.
63 (11) (15) "Sale" means selling, exchange, transfer of title, barter, gift, offer for sale or
64 distribution or disposition of cigarettes or other tobacco products.
65 (12) (16) "Sale at retail" or "retail sale" means a sale to a consumer or to any person for any
66 purpose other than resale.
67 (13) (17) "Sale by wholesaler" means and includes any bona fide transfer of title to tobacco
68 products by a wholesaler for a valuable consideration, made in the ordinary course of trade or in
69 the usual conduct of the wholesaler's business.
70 (14) (18) "Stamp" or "meter impression" means any cigarette stamp or any meter or ink
71 impression or other indicia authorized by the Tax Commissioner to serve as a stamp and shall be
72 of the design and color as prescribed by the Tax Commissioner.
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73 (15) (19) "Stamped cigarettes" means that the stamp or meter impression, as required by
74 this article, has been affixed to the bottom of the package of cigarettes.
75 (16) (20) "Subjobber" or "subjobber dealer" includes any person who purchases stamped
76 cigarettes or tax-paid tobacco products from a wholesaler or from any other person who
77 purchases from the manufacturer or importer and who purchases the tax-paid tobacco products
78 solely for the purpose of bona fide resale to retail dealers.
79 (17) (21) "Tax-not-paid tobacco product" means a tobacco product upon which the tax
80 imposed by this article has not been paid.
81 (18) (22) "Tax-paid tobacco products" means a tobacco product upon which the tax
82 imposed by this article has been paid.
83 (19) (23) "Tobacco product" includes cigarettes and any other tobacco product. "heated
84 tobacco product."
85 (20) (24) "Transportation company" means a person operating or supplying to common
86 carriers, cars, boats or other vehicles for the transportation or accommodation of passengers and
87 engaged in the sale of a tobacco product at retail.
88 (21) (25) "Transporter" means a person importing or transporting into this state a tobacco
89 product obtained from a source located outside this state or transporting within this state tobacco
90 products belonging to another person.
91 (22) (26) "Unstamped cigarettes" means that the stamp or impression as required by this
92 article has not been affixed to the bottom of the package of cigarettes.
93 (23) (27) "Vending machine operator" means any person operating one or more vending
94 machines for the sale of tobacco products. The sale of tobacco products through a vending
95 machine will be construed as sales at retail and subjects the vending machine operator to this
96 article and rules pertaining to retail dealers.
97 Whenever any tobacco products vending machine operator purchases tax-not-paid
98 tobacco products directly from the manufacturer or any other person, the vending machine
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99 operator shall be considered to be a wholesaler and is liable for payment of the excise tax imposed
100 by this article and the affixing of the required stamps.
101 (24) (28) "Wholesale price" means the gross invoice price, including all federal excise
102 taxes, at which the manufacturer of the tobacco product sells the tobacco product to unaffiliated
103 distributors, excluding all trade discounts and other reductions in the manufacturer's price. If the
104 taxpayer buys from other than a manufacturer, "wholesale price" means the gross invoice price,
105 including all federal excise taxes and excluding all trade discounts and other similar reductions in
106 price.
107 (25) (29) "Wholesaler" or "wholesale dealer" includes any person in this state who
108 purchases tax-not-paid tobacco products directly from the manufacturer, or such other seller as
109 may be approved by the Tax Commissioner. Any distributor, dealer, subjobber, subjobber dealer,
110 retailer or any other person that imports or transports tax-not-paid tobacco products into this state,
111 or that causes tax-not-paid tobacco products to be imported or transported into this state is a
112 wholesaler liable for the tax imposed under this article and, in the case of cigarettes purchased, is
113 liable for affixing tax indicia in accordance with the requirements of this article. No wholesaler or
114 other person may purchase tax-not-paid tobacco products from any seller not approved by the Tax
115 Commissioner.
§11-17-3. Levy of tax; ratio; dedication of proceeds.
1 (a) Tax on cigarettes and tobacco products other than cigarettes. — For the purpose of
2 providing revenue for the General Revenue Fund of the state, an excise tax is hereby levied and
3 imposed on sales of cigarettes and tobacco products other than cigarettes.
4 (b) Tax rate on cigarettes. — Effective May 1, 2003, the excise tax rate levied and imposed
5 on the sale of cigarettes is 55 cents on each twenty cigarettes or in like ratio on any part thereof:
6 Provided, That on and after July 1, 2016, the excise tax rate levied and imposed on the sale of
7 cigarettes is $1.20 on each twenty cigarettes or in like ratio on any part thereof. Only one sale of
8 the same article shall be used in computing the amount of tax due under this subsection.
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9 (c) Tax on tobacco products other than cigarettes. — Effective January 1, 2002, the excise
10 tax levied and imposed on the sales or use of tobacco products other than cigarettes at the rate
11 equal to seven percent of the wholesale price of each article or item of tobacco products other than
12 cigarettes sold by the wholesaler or subjobber dealer, whether or not sold at wholesale, or if not
13 sold, then at the same rate upon the use by the wholesaler or dealer: Provided, That on and after
14 July 1, 2016, the excise tax rate levied and imposed on the sales or use of tobacco products other
15 than cigarettes is at the rate equal to twelve percent of the wholesale price of each article or item of
16 tobacco products other than cigarettes sold by the wholesaler or subjobber dealer, whether or not
17 sold at wholesale, or if not sold, then at the same rate upon the use by the wholesaler or dealer.
18 Only one sale of the same article shall be used in computing the amount of tax due under this
19 subsection.
20 (d) Tax rate on "heated tobacco products" and "heated nicotine products" — Effective July
21 1, 2024, the excise tax rate levied and imposed on the sale of "heated tobacco products" and
22 heated nicotine products at the rate is 60 cents on each 20 heat sticks or in like ratio on any part
23 thereof:
24 (d) (e) Effective date of amendments. — Amendments to this section enacted in the year
25 2003 apply in determining tax imposed under this article from May 1, 2003, through June 30, 2016.
26 Amendments to this section enacted in the year 2016 apply in determining tax imposed under this
27 article effective on and after July 1, 2016.
§11-17-4b. Levy of tax on e-cigarette liquid; definitions; rate; invoice; report; payment;
authority of the Tax Commissioner to inspect and examine witnesses; presumption;
bond.
1 (a) Definitions. — When used in this section, words, terms and phrases defined in this
2 subsection, and any variations thereof required by the context, have the meaning ascribed to them
3 in this subsection, except where the context indicates a different meaning is intended.
4 (1) "E-cigarette" means an electrical or electronic device that provides a smoke, vapor, fog,
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5 mist, gas or aerosol suspension of nicotine or another substance that, when used or inhaled,
6 simulates the activity of smoking. The term e-cigarette includes, but is not limited to, a device that
7 is composed of a heating element, battery or electrical or electronic circuit, or a combination of
8 heating element, battery and electrical or electronic circuit, which works in combination with e-
9 liquid to produce an inhalable product. The term e-cigarette includes, but is not limited to, any so
10 designed, or similarly designed, product that is manufactured, distributed, marketed or sold as an
11 e-cigarette, e-cigar, e-pipe or under any other name or descriptor. The term "simulates the activity
12 of smoking", in the context of this definition, means replicating, mimicking or reproducing an
13 experience similar to inhaling, or otherwise drawing into the mouth or nose, or exhaling the smoke
14 or combustion product of burning tobacco or any other product or material that can be used in a
15 similar fashion. "E-cigarette" does not include a "heated tobacco product" or a "heated nicotine
16 product" for tax purposes, as defined in §11-17-2 of this code.
17 (2) "E-cigarette liquid" means any of the liquids or liquid mixtures used in e-cigarettes and
18 is also known as e-juice, e-fluid, e-liquid or e-liquid product. E-cigarette liquid includes e-cigarette
19 liquid mixing kits and e-cigarette liquid mixing kit components. When used in, or with, an e-
20 cigarette, e-cigarette liquid is vaporized or otherwise converted into an inhalable product. E-
21 cigarette liquid may or may not include, without limitation, propylene glycol, vegetable glycerin,
22 nicotine from any source or flavorings. "E-cigarette liquid" does not include a "heated tobacco
23 product" or a "heated nicotine product" for tax purposes, as defined in §11-17-2 of this code.
24 (b) Levy of tax; rate. —
25 (1) On and after July 1, 2016, an excise tax is levied and imposed on sales of e-cigarette
26 liquid at the rate of 7.5 cents per milliliter or fraction thereof, or if not sold, then at the same rate
27 upon the use by the wholesaler or dealer. For purposes of this article, any distributor, dealer,
28 subjobber, subjobber dealer, retailer or any other person that imports or transports e-cigarette
29 liquids into this state, or that causes e-cigarette liquids to be imported or transported into this state,
30 is hereby deemed to be a wholesaler for purposes of this section and is liable for the tax imposed
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31 under this article. No wholesaler or other person may purchase e-cigarette liquids from any seller
32 not approved by the Tax Commissioner. E-cigarette liquid mixing kits and e-cigarette liquid mixing
33 kit components shall be taxed in accordance with the amount of e-cigarette liquid, in milliliters, that
34 can be produced by or from the kit or components thereof, as determined by the Tax
35 Commissioner.
36 (2) Only one sale of e-cigarette liquid shall be used in computing the amount of tax due
37 under this section.
38 (c) How tax paid; invoice required; reports required; due date; records to be kept. —
39 (1) The tax imposed in this section on e-cigarette liquid shall be paid using an invoice
40 method prescribed by the Tax Commissioner.
41 (2) The tax will be paid on any and all e-cigarette liquid coming into the state for the
42 purpose of sale or use in this state on and after July 1, 2016.
43 (3)