Information Release

XT 2017-01 - Excise and Energy Tax Division Information Release – Cigarette – Minimum Pricing of Cigarettes – April, 2017

This information release is intended to provide clarity concerning cigarette transactions and the responsibilities of the wholesale cigarette dealers regarding the Unfair Cigarette Sales Act.

In accordance with R.C. 1333.11, a wholesale dealer of cigarettes must add a 3.5% mark-up to cover the costs of doing business prior to selling the cigarette product to a retailer dealer. At the time a wholesale dealer is able to provide evidence to the Department’s satisfaction that their cost of doing business is lower than 3.5%, the wholesale dealer may reduce their mark-up percentage accordingly.

Additionally, when a wholesale dealer sells cigarette product to another wholesale dealer, the Department does not require the selling wholesale dealer to add a mark-up to the product. However, the purchasing wholesale dealer is required to add the 3.5% (or applicable) mark-up prior to selling the cigarette product to a retail dealer.

Please contact the Department at 1-855-466-3921 with any questions regarding this release.

Ohio Department of Taxation
Excise and Energy Tax Division
P.O. Box 530
Columbus, OH 43216-0530
Telephone: (855) 466-3921, option 3
Fax: (206) 350-6722