XT 2002-06 - New Product Subject to the Other Tobacco Products Tax and Restrictions on Cigarette Sales and Packaging - September 3, 2002
New Product. There is a new product being distributed in Ohio that is made from 100 percent tobacco and is the form of a mint. The name of this product is "Ariva." This product and any similar products are subject to the Ohio other tobacco products tax at the rate of 17 percent of the wholesale price.
Cigarette Sales Restriction. Tobacco product distributors have reported sales in Ohio of the Kentucky Blonde brand of cigarettes manufactured by Red Hawk Tobacco Company. The Franklin County Court of Common Pleas has issued a consent decree resolving a lawsuit between the Ohio Attorney General's Office and Red Hawk Tobacco Company. The lawsuit involved sales of Red Hawk's cigarettes and its corresponding cigarette master settlement agreement escrow obligations. Under the consent decree, Red Hawk is prohibited from selling Kentucky Blonde, or any other brand of cigarette it may distribute and/or manufacture, within the state of Ohio, either directly or through a distributor, retailer, or other intermediary, until June 26, 2004. Further, Red Hawk is not permitted to sell cigarettes in Ohio, either directly or through any intermediaries, after June 26, 2004, unless it notifies the Ohio Attorney General's Office of its intent to manufacture and/or distribute its products in Ohio and pays all of its past, present, and then-owing escrow obligations.
Packaging Restriction. Amended Substitute Senate Bill 242, 124th General Assembly, places new restrictions on the packaging of cigarettes and roll-your-own tobacco. Effective September 19, 2002, it will be unlawful for anyone to manufacture, sell, or distribute in Ohio any pack or other container of cigarettes containing fewer than twenty cigarettes or any packages of roll-your-own tobacco containing less than six-tenths of one ounce of tobacco. It will also be unlawful to sell cigarettes in a smaller quantity than the pack or container they were placed in by the manufacturer. The package container limitations are in Section 2927.02 (B) (4) and (5) of the Ohio Revised Code. Violators may be charged with a fourth degree misdemeanor for the first offense and a third degree misdemeanor for subsequent offenses. These provisions are enforced by local law enforcement departments.
Please contact us if you have any questions.
Ohio Department of Taxation
Fuel Use and Excise Tax Unit
P.O. Box 530
Columbus, Ohio 43216-0530
Telephone: (855) 466-3921
Fax: (206) 350-6722
Web site: http://tax.ohio.gov/