SB 168: "An Act relating to issuance and revocation of licenses for the importation, sale, distribution, or manufacture of cigarettes and tobacco products; relating to a tax refund or credit for unsaleable, returned, or destroyed tobacco products; relating to restrictions on shipping or transporting cigarettes; relating to records concerning the sale of cigarettes; amending and adding definitions relating to cigarette taxes; relating to the payment of cigarette taxes; relating to penalties applicable to cigarette taxes; relating to the definition of the wholesale price of tobacco products; relating to payment of cigarette taxes through the use of cigarette tax stamps; relating to provisions making certain cigarettes contraband and subject to seizure and forfeiture; relating to certain crimes, penalties, and interest concerning tobacco taxes and sales; and providing for an effective date."
00 SENATE BILL NO. 168 01 "An Act relating to issuance and revocation of licenses for the importation, sale, 02 distribution, or manufacture of cigarettes and tobacco products; relating to a tax refund 03 or credit for unsaleable, returned, or destroyed tobacco products; relating to restrictions 04 on shipping or transporting cigarettes; relating to records concerning the sale of 05 cigarettes; amending and adding definitions relating to cigarette taxes; relating to the 06 payment of cigarette taxes; relating to penalties applicable to cigarette taxes; relating to 07 the definition of the wholesale price of tobacco products; relating to payment of cigarette 08 taxes through the use of cigarette tax stamps; relating to provisions making certain 09 cigarettes contraband and subject to seizure and forfeiture; relating to certain crimes, 10 penalties, and interest concerning tobacco taxes and sales; and providing for an effective 11 date." 12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:
01 * Section 1. AS 43.50.035 is amended to read: 02 Sec. 43.50.035. Wholesaler-distributor license. A person outside of this 03 state who sells cigarettes into this state and is not required to be licensed under 04 AS 43.50.010 may apply [QUALIFY] for a wholesaler-distributor license [BY 05 FURNISHING A GOOD AND SUFFICIENT SURETY BOND IN AN AMOUNT 06 EQUAL TO TWICE THE AVERAGE MONTHLY RETURN AND IN NO CASE 07 LESS THAN $5,000, PAYABLE TO THE DEPARTMENT AND APPROVED BY 08 THE DEPARTMENT OF LAW. IF A WHOLESALER-DISTRIBUTOR FAILS TO 09 PAY THE CIGARETTE TAX WHEN DUE, THE BOND MAY BE FORFEITED 10 AND THE LICENSE REVOKED]. The department shall adopt reasonable 11 regulations necessary for the collection of cigarette taxes on cigarette sales made 12 by the [MAY ISSUE PERMITS IN PLACE OF BONDS TO RESIDENT HOLDERS 13 OF] wholesaler-distributor licensee into this state and standards for 14 (1) application and issuance of the license; and 15 (2) refusal to issue the license [LICENSES DOING BUSINESS 16 WHOLLY IN THE STATE WHO PAY THE TAX BEFORE SHIPMENT]. 17 * Sec. 2. AS 43.50.040 is amended to read: 18 Sec. 43.50.040. Expiration of licenses. A license issued under AS 43.50.010 19 or 43.50.035 expires on June 30 [,] following the date of issue. If a license is revoked, 20 or the business for which the license is issued changes ownership or the licensee 21 changes the place of business from the premises covered by the license, the licensee 22 shall immediately return the license to the department. If the licensee moves the 23 business to another location in the state, the license shall, upon the payment of a fee of 24 50 cents, be reissued for the new location for the balance of the unexpired term. 25 Before a license issued under AS 43.50.010 or 43.50.035 expires, the [THE] 26 licensee may apply to [, ON APPLICATION TO THE DEPARTMENT 27 ACCOMPANIED BY THE RENEWAL FEE, MAY, BEFORE THE EXPIRATION 28 OF THE LICENSE,] renew the license for one year from the expiration date of the 29 license. The renewal fee required by AS 43.50.030 must accompany the 30 application. The department shall adopt reasonable regulations that it considers 31 necessary regarding the renewal of licenses.
01 * Sec. 3. AS 43.50.070 is amended to read: 02 Sec. 43.50.070. Suspension or revocation of or refusal to renew a license 03 [REVOCATION OF LICENSES]. The department may suspend, [OR] revoke, or 04 refuse to renew a license issued under this chapter [AS 43.50.010 - 43.50.180] (1) 05 for a negligent violation of AS 11.76.100, 11.76.106, 11.76.107, or a violation of this 06 chapter [AS 43.50.010 - 43.50.180] or a regulation of the department adopted under 07 this chapter [AS 43.50.010 - 43.50.180]; (2) if a licensee ceases to act in the capacity 08 for which the license was issued; or (3) if a licensee [MANUFACTURER, 09 DISTRIBUTOR, OR WHOLESALE DISTRIBUTOR] negligently sells tobacco or 10 products containing tobacco to a person who is required to, but does not, hold a 11 license endorsement under AS 43.70.075 or [NONLICENSED RETAILER OR A 12 RETAILER] whose license endorsement under AS 43.70.075 has been suspended. A 13 person whose license is suspended or revoked may not sell cigarettes or tobacco 14 products, or permit cigarettes or tobacco products to be sold, during the period of 15 the suspension or revocation on the premises occupied or controlled by that person. A 16 disciplinary proceeding or action is not barred or abated by the expiration, transfer, 17 surrender, renewal, or extension of a license issued under this chapter [AS 43.50.010 18 - 43.50.180]. The department shall comply with the provisions of AS 44.62 ( [THE] 19 Administrative Procedure Act), except that a hearing officer of the department, 20 rather than a hearing officer assigned under AS 44.62.350, may conduct hearings 21 [(AS 44.62)]. 22 * Sec. 4. AS 43.50.070 is amended by adding a new subsection to read: 23 (b) In this section, "licensee" means a person licensed under AS 43.50.010 - 24 43.50.180 or 43.50.300 - 43.50.390. 25 * Sec. 5. AS 43.50.090(a) is amended to read: 26 (a) There is levied an excise tax of 38 mills on each cigarette imported or 27 acquired in the state. The tax shall be paid through the use of stamps as provided 28 in AS 43.50.500 - 43.50.695. The failure to pay the tax through the use of stamps 29 does not relieve a person of the obligation to pay taxes due under this chapter. 30 The person shall still pay the tax, and the tax is due on or before the end of the 31 month following the month in which cigarettes were manufactured, imported,
01 acquired, or sold in this state [EACH LICENSEE SHALL, AT THE TIME OF 02 FILING THE RETURN REQUIRED BY AS 43.50.080, PAY TO THE 03 DEPARTMENT THE EXCISE FOR THE CALENDAR MONTH COVERED BY 04 THE RETURN, DEDUCTING FOUR-TENTHS OF ONE PERCENT OF THE 05 TOTAL TAX DUE, WHICH THE LICENSEE SHALL RETAIN TO COVER THE 06 EXPENSE OF ACCOUNTING AND FILING RETURNS]. Cigarettes upon which 07 the excise is imposed are not again subject to the excise when acquired by another 08 person. 09 * Sec. 6. AS 43.50.100(d) is amended to read: 10 (d) A person or licensee who is in control or possession of cigarettes contrary 11 to this chapter [AS 43.50.010 - 43.50.180,] or who offers to sell or dispose of 12 cigarettes to others for the purpose of resale without being licensed to do so is 13 considered to have possession of the cigarettes as a consumer and is personally liable 14 for the cigarette taxes imposed by this chapter [TAX], plus a penalty of 100 percent 15 [PER CENT]. 16 * Sec. 7. AS 43.50 is amended by adding a new section to read: 17 Sec. 43.50.105. Restrictions on shipping or transporting cigarettes. (a) A 18 person engaged in the business of selling cigarettes may not ship or cause to be 19 shipped cigarettes to a person in this state who is not 20 (1) licensed under this chapter or AS 43.70.075; 21 (2) an operator of a customs bonded warehouse under 19 U.S.C. 1311 22 or 19 U.S.C. 1555; or 23 (3) an officer, employee, or agent of the United States or this state who 24 is acting within the scope of employment as an officer, employee, or agent. 25 (b) A common or contract carrier may not knowingly transport cigarettes to a 26 person in this state, unless the person (1) shipping the cigarettes is licensed under this 27 chapter and provides the common or contract carrier with a copy of the shipper's 28 current license issued by the department; and (2) receiving the cigarettes is a person 29 described under (a)(1) - (3) of this section. If cigarettes are transported by a common 30 or contract carrier to a home or residence, it is rebuttably presumed that the common 31 or contract carrier knew that the person receiving the cigarettes was not a person
01 described under (a)(1) - (3) of this section. 02 (c) A person, other than a common or contract carrier, may not knowingly 03 transport cigarettes to a person in this state, unless the person receiving the cigarettes 04 is a person described under (a)(1) - (3) of this section. 05 (d) A person engaged in the business of selling cigarettes who ships or causes 06 to be shipped cigarettes to a person in this state shall plainly and visibly mark the 07 container or wrapping with the word "cigarettes" if the cigarettes are shipped in a 08 container or wrapping other than the cigarette manufacturer's original container or 09 wrapping. 10 (e) A person who violates the provisions of this section is guilty of a 11 (1) class A misdemeanor if the person unlawfully ships or transports at 12 least one but fewer than 1,000 cigarettes; 13 (2) class C felony if the person unlawfully ships or transports 1,000 or 14 more cigarettes. 15 (f) In addition to the criminal penalty under (e) of this section, the department 16 may assess a civil fine of not more than $5,000 for each violation of this section. 17 * Sec. 8. AS 43.50.130(d) is amended to read: 18 (d) An invoice for the sale of cigarettes given or accepted by a licensee under 19 this chapter [AS 43.50.010 - 43.50.180] must state whether the taxes [TAX] imposed 20 by this chapter have [AS 43.50.010 - 43.50.180 HAS] been paid. 21 * Sec. 9. AS 43.50.170(7) is amended to read: 22 (7) "person" includes an individual, company, partnership, limited 23 liability partnership, joint venture, joint agreement, limited liability company, 24 association, mutual or otherwise, corporation, estate, trust, business trust, receiver, 25 trustee, syndicate, or political subdivision of this state, or combination acting as a unit; 26 * Sec. 10. AS 43.50.170 is amended by adding new paragraphs to read: 27 (11) "tobacco product" has the meaning given in AS 43.50.390; 28 (12) "wholesaler-distributor" means a person outside this state who 29 sells or distributes cigarettes into this state and who is not required to be licensed 30 under AS 43.50.010. 31 * Sec. 11. AS 43.50.190(b) is amended to read:
01 (b) The tax levied by this section is in addition to the tax levied by 02 AS 43.50.010 - 43.50.180. The tax shall be administered and collected in the same 03 manner as the tax levied by AS 43.50.010 - 43.50.180, except that receipts from the 04 tax shall be deposited in the general fund. The penalties provided in AS 43.05 and 05 this chapter apply to the tax levied in this section. 06 * Sec. 12. AS 43.50.320(f) is amended to read: 07 (f) The department may suspend, [OR] revoke, or refuse to renew a license 08 issued under this section as provided in AS 43.50.070 [IF THE LICENSEE 09 VIOLATES A PROVISION OF AS 43.50.300 - 43.50.390 OR A REGULATION 10 ADOPTED UNDER AS 43.50.370]. 11 * Sec. 13. AS 43.50 is amended by adding a new section to read: 12 Sec. 43.50.335. Tax credits and refunds. The department shall adopt 13 procedures for a refund or credit to a licensee of the tax paid for tobacco products that 14 have become unfit for sale, are destroyed, or are returned to the manufacturer for 15 credit or replacement if the licensee provides proof acceptable to the department that 16 the tobacco products have not been and will not be consumed in this state. 17 * Sec. 14. AS 43.50.390(5) is repealed and reenacted to read: 18 (5) "wholesale price" means 19 (A) the established price for which a manufacturer sells a 20 tobacco product to a distributor after deduction of a discount or other reduction 21 received by the distributor for quantity or cash if the manufacturer's established 22 price is adequately supported by bona fide arm's length sales as determined by 23 the department; or 24 (B) the price, as determined by the department, for which 25 tobacco products of comparable retail price are sold to distributors in the 26 ordinary course of trade if the manufacturer's established price does not meet 27 the standards of (A) of this paragraph. 28 * Sec. 15. AS 43.50 is amended by adding new sections to read: 29 Article 5. Cigarette Tax Stamps. 30 Sec. 43.50.500. Tax payment by use of stamps. A licensee shall pay the tax 31 imposed under AS 43.50.090(a) and 43.50.190(a) through the use of stamps issued
01 under AS 43.50.500 - 43.50.700. 02 Sec. 43.50.510. Stamp design; manner of affixing. (a) The department shall 03 design and furnish stamps of sizes and denominations as determined by the 04 department. 05 (b) Notwithstanding the packaging requirements of AS 43.70.075(g)(1), a 06 stamp required under AS 43.50.500 - 43.50.700 must be affixed 07 (1) on the smallest package that will be handled, sold, used, consumed, 08 or distributed in this state; and 09 (2) in a denomination equal to the amount of tax due under this chapter 10 on the cigarettes in the package. 11 (c) A stamp required under AS 43.50.500 - 43.50.700 shall be affixed to the 12 bottom of each individual package of cigarettes in a manner so that the stamp cannot 13 be removed from the package without being mutilated or destroyed. 14 (d) For purposes of this section, a stamp is considered affixed only if more 15 than 80 percent of the stamp is attached to the individual package in accordance with 16 (c) of this section and regulations adopted by the department. 17 Sec. 43.50.520. Stamp required before sale, distribution, or consumption. 18 (a) Except as provided in AS 43.50.580, a licensee or the authorized agent or designee 19 of the licensee shall affix a stamp, in the manner required by AS 43.50.510, to each 20 package of cigarettes immediately upon the opening of the shipping container 21 containing the package and before sale, distribution, or consumption in this state. 22 (b) Except as provided in AS 43.50.580 and 43.50.610, a person may not 23 engage in the following activities in this state unless the package containing the 24 cigarettes is affixed with the required stamp: 25 (1) sell or distribute cigarettes to a person who is a consumer in this 26 state; 27 (2) acquire, hold, own, possess, or transport cigarettes for sale or 28 distribution in this state; 29 (3) import or cause to be imported cigarettes into this state for sale, 30 distribution, or consumption; or 31 (4) place or store cigarette packages in a vending machine in this state.
01 Sec. 43.50.530. Sale of stamps. (a) The department shall furnish stamps for 02 sale to licensees. 03 (b) The department may enter into agreements with financial institutions to 04 permit the sale of stamps by those institutions. The department shall make a list of 05 financial institutions authorized to sell stamps under this section available to the 06 public. 07 Sec. 43.50.540. Purchase of and payment for stamps. (a) A licensee shall 08 apply to the department or a financial institution authorized under AS 43.50.530(b) to 09 purchase stamps required by AS 43.50.500 - 43.50.700. 10 (b) A licensee may authorize an agent or designee to purchase stamps for the 11 licensee at a location where stamps are sold. The licensee's authorization of an agent 12 or designee must be in writing and must be signed by the licensee. The licensee shall 13 provide a copy of the authorization to the department. The authorization continues in 14 effect until the department receives the licensee's written notice of revocation of the 15 authorization. 16 (c) Except as otherwise provided in this subsection, each stamp shall be sold 17 to a licensee at its denominated value less the discount provided in this subsection. 18 The discount under this subsection is provided as compensation for affixing stamps to 19 packages as required by AS 43.50.500 - 43.50.700. The department may reduce or 20 eliminate the discount to a licensee under this subsection if the licensee fails to meet 21 the requirements of AS 43.50.500 - 43.50.700. The discount under this subsection is 22 equal to the sum of the amounts calculated using the following percentages of 23 denominated value of stamps purchased by a licensee under this section in a calendar 24 year: 25 (1) $1,000,000 or less, three percent; 26 (2) the amount that is more than $1,000,000 but not more than 27 $2,000,000, two percent; 28 (3) the amount that is more than $2,000,000 but not more than 29 $5,000,000, 0.5 percent; 30 (4) the amount that is over $5,000,000, zero percent. 31 (d) Payment for stamps shall be made at the time of purchase, except that the
01 department may permit a licensee to defer payments as provided in AS 43.50.550. 02 (e) The licensee or the licensee's agent or designee must obtain the stamps in 03 person from the department or a financial institution authorized to sell stamps under 04 AS 43.50.530(b). Alternatively, the licensee may request in writing that the stamps be 05 shipped or transported in a manner specified by the licensee that is acceptable to the 06 department. The department may accept only United States mail or common or 07 private carrier as a shipping or transportation method. 08 (f) Title to the stamps passes immediately to the licensee at the time the 09 stamps are obtained in person or, if the stamps are shipped or transported, at the time 10 the stamps are placed in the United States mail or received by the common or private 11 carrier. The licensee bears all costs associated with shipping or transporting the 12 stamps and all risks of possible loss or damage while in transit. 13 (g) Loss, destruction, or theft of stamps does not absolve the licensee of its 14 obligation to make payment for the stamps, including payment on a deferred-payment 15 basis under AS 43.50.550. 16 (h) For purposes of the discount provided in (c) of this section, "stamps 17 purchased by a licensee" includes stamps purchased by affiliated licensees. 18 Sec. 43.50.550. Deferred-payment basis for stamps. (a) A licensee may 19 apply to the department to purchase stamps on a deferred-payment basis. Upon 20 receipt of the application and the bond required under (b) of this section, the 21 department may set the maximum dollar amount of stamps that the licensee is 22 authorized to purchase on a deferred-payment basis in a calendar month. 23 (b) A licensee who submits an application for the purchase of stamps on a 24 deferred-payment basis shall post a bond acceptable to the department in an amount 25 equal to 200 percent of the maximum dollar amount of allowed monthly purchases 26 under this section as a condition of approval of the application. 27 (c) Amounts owing for stamps purchased on a deferred-payment basis in a 28 calendar month are due on or before the last day of the next calendar month. Payment 29 shall be made by a remittance acceptable to the department that is made payable to the 30 department. 31 (d) The department may designate the sales locations where the licensee may
01 make purchases of stamps on a deferred-payment basis and fix the dollar amount of 02 purchases that the licensee may make under this section at each designated sales 03 location each month. 04 Sec. 43.50.560. Suspension of deferred-payment basis privilege. The 05 department may suspend, without prior notice, a licensee's privilege to purchase 06 stamps on a deferred-payment basis or may reduce the monthly dollar amount of 07 purchases the licensee may make under AS 43.50.550 if 08 (1) the licensee fails to pay for stamps when payment is due; 09 (2) the licensee's bond is cancelled or becomes void, impaired, or 10 unenforceable; 11 (3) the department determines that the collection of an amount unpaid 12 or due from the licensee under this chapter is jeopardized; or 13 (4) the licensee violates a state statute or regulation related to the 14 collection of taxes under this chapter. 15 Sec. 43.50.570. Interest. A licensee who fails to pay an amount due for the 16 purchase of stamps within the time required 17 (1) is considered to have failed to pay the cigarette taxes due under this 18 chapter; and 19 (2) shall pay interest at the rate established under AS 43.05.225 from 20 the date on which the amount became due until the date of payment. 21 Sec. 43.50.580. Possession of unstamped cigarettes. (a) Except as provided 22 in (b) of this section and in AS 43.50.610, a person may not possess unstamped 23 cigarettes in this state. 24 (b) A licensee may possess unstamped cigarettes in this state if 25 (1) the licensee posts a surety bond in an amount satisfactory to the 26 department to ensure performance of its duties under this chapter; and 27 (2) unstamped cigarettes are necessary for the conduct of the licensee's 28 business in making sales or distributions to an instrumentality of the federal 29 government or an Indian tribal organization authorized by law to possess cigarettes not 30 taxed under this chapter. 31 (c) At the time of shipping or delivering cigarettes to an instrumentality of the
01 federal government or an Indian tribal organization authorized by law to possess 02 cigarettes not taxed under this chapter, a licensee shall make a duplicate invoice 03 showing complete details of the shipment or other distribution and a statement 04 indicating whether stamps were affixed to each cigarette package in accordance with 05 AS 43.50.500 - 43.50.700. The licensee shall transmit the duplicate invoice to the 06 department as an attachment to the monthly report required under AS 43.50.630. 07 (d) If a licensee who is authorized to possess unstamped cigarettes under (b) 08 of this section fails to comply with the requirements of this section, the licensee is no 09 longer authorized to and may not possess unstamped cigarettes under this section and 10 is subject to the imposition of any applicable penalty under this title or other law. 11 (e) For purposes of (a) of this section, "person" does not include entities to 12 whom sales or distributions are made as described in (b)(2) of this section. 13 Sec. 43.50.590. Refunds or credits for unused stamps and for unsalable, 14 destroyed, or certain returned cigarette packages. (a) The department shall adopt 15 procedures for a refund or credit to a licensee in the amount of the denominated value, 16 less the discount given under AS 43.50.540, for 17 (1) unused or damaged stamps; or 18 (2) stamps affixed to cigarette packages that have become unfit for use 19 or sale, are destroyed, or are returned to the manufacturer for credit or replacement if 20 the licensee provides proof acceptable to the department that the cigarettes have not 21 been and will not be consumed in this state. 22 (b) A refund or credit under (a) of this section may not be allowed for stamps 23 affixed to cigarette packages in violation of this chapter or AS 45.53. 24 Sec. 43.50.600. Stamps prohibited on cigarette packages not complying 25 with federal and state laws. A licensee or the licensee's authorized agent or designee 26 may not affix a stamp to a cigarette package if the cigarettes 27 (1) may not be acquired, held, owned, imported, possessed, sold, or 28 distributed in this state under AS 43.50.400; or 29 (2) are not in compliance with other state or federal laws. 30 Sec. 43.50.610. Unstamped cigarettes as contraband; seizure. Unstamped 31 cigarettes found in this state are contraband and may be seized by the commissioner or
01 an agent or employee of the commissioner or by any peace officer of the state, unless 02 (1) the cigarettes are 03 (A) in the possession of a licensee or are in transit from outside 04 the state and are consigned to a licensee; and 05 (B) in the original and unopened shipping container; or 06 (2) possession of the unstamped cigarettes is not a violation of this 07 chapter. 08 Sec. 43.50.620. Forfeiture and destruction of seized cigarettes. Cigarettes 09 seized under AS 43.50.500 - 43.50.700 are forfeited to the state. After notice and an 10 opportunity for a hearing, the commissioner shall destroy the cigarettes forfeited under 11 this section. 12 Sec. 43.50.630. Monthly reports; records retention; inspection of records. 13 (a) On or before the last day of each calendar month, a licensee shall file the 14 following information for each place of business with the department, on a form or in 15 a format prescribed by the department: 16 (1) the quantity and brands of cigarettes manufactured, imported, 17 acquired, or sold in the state during the preceding calendar month; 18 (2) the number and dollar amount of stamps 19 (A) purchased during the preceding calendar month; 20 (B) affixed to cigarette packages during the preceding calendar 21 month; 22 (C) not affixed to cigarette packages and on hand at the end of 23 the preceding calendar month; and 24 (D) refunded or credited to a licensee under AS 43.50.590; and 25 (3) any other information that the department requires to carry out its 26 duties under this chapter. 27 (b) If a licensee ceases to manufacture, import, acquire, or sell cigarettes in 28 this state, the licensee shall immediately file the form required under (a) of this section 29 with the department, for the period ending with the cessation. 30 (c) All statements and other records required by AS 43.50.500 - 43.50.700 31 must be
01 (1) in a form or format prescribed by the department; 02 (2) preserved by a licensee for a period of three years; and 03 (3) available for inspection at any time upon oral or written demand by 04 the department or its authorized agent. 05 (d) A summary of information filed under (a) of this section shall be prepared 06 by the department and released to the public upon request. 07 Sec. 43.50.640. Misconduct involving unstamped cigarettes or stamps in 08 the first degree. (a) A person commits the crime of misconduct involving unstamped 09 cigarettes or stamps in the first degree if the person 10 (1) with reckless disregard that the cigarettes are unstamped 11 (A) sells or distributes 1,000 or more unstamped cigarettes in a 12 single transaction; 13 (B) owns or possesses 1,000 or more unstamped cigarettes with 14 the intent to sell; or 15 (C) acquires, holds, transports, imports, or possesses 10,000 or 16 more unstamped cigarettes; or 17 (2) with reckless disregard that the stamp was previously affixed to 18 another cigarette package; 19 (A) affixes a previously used stamp to a cigarette package; or 20 (B) possesses, sells, or distributes a previously used stamp. 21 (b) Misconduct involving unstamped cigarettes or stamps in the first degree is 22 a class C felony. 23 Sec. 43.50.650. Misconduct involving unstamped cigarettes or stamps in 24 the second degree. (a) A person commits the crime of misconduct involving 25 unstamped cigarettes or stamps in the second degree if the person 26 (1) with reckless disregard that the cigarettes are unstamped 27 (A) sells or distributes at least one but less than 1,000 28 unstamped cigarettes in a single transaction; 29 (B) owns or possesses at least one but less than 1,000 30 unstamped cigarettes, with intent to sell; or 31 (C) acquires, holds, transports, imports, or possesses at least
01 one but less than 10,000 unstamped cigarettes; or 02 (2) is not licensed under this chapter or otherwise authorized by the 03 department to possess stamps and possesses a stamp that is not affixed to a cigarette 04 package. 05 (b) Misconduct involving unstamped cigarettes or stamps in the second degree 06 is a class A misdemeanor. 07 Sec. 43.50.660. Construction of criminal statutes. (a) The provisions of 08 AS 11.16, AS 11.81.600, 11.81.610, and 11.81.900 apply to AS 43.50.640 and 09 43.50.650. 10 (b) For purposes of AS 43.50.640 and 43.50.650, display of cigarettes by a 11 person, or possession other than in the original and unopened shipping container of 12 cigarettes by a person who holds a business license endorsement under AS 43.70.075, 13 is prima facie evidence of possession with intent to sell cigarettes. In this subsection, 14 "display" means to openly exhibit. 15 Sec. 43.50.670. Unauthorized transfer of unaffixed stamps. (a) A licensee 16 may not sell, exchange, or otherwise transfer stamps not affixed to a package of 17 cigarettes in accordance with this chapter to another person without the prior written 18 approval of the department. 19 (b) After notice and opportunity for a hearing, the department may assess a 20 civil fine of not less than $1,000 nor more than $10,000 for a violation of (a) of this 21 section. The fine assessed is in addition to any other penalty available under the law. 22 Sec. 43.50.700. Definitions. In AS 43.50.500 - 43.50.700, unless the context 23 otherwise requires, 24 (1) "affiliated licensees" means two or more licensees in which the 25 same person holds, directly or indirectly, at least a 50 percent ownership interest; 26 (2) "carton" means a box or container originating from the 27 manufacturer that contains packages of that manufacturer's cigarettes; 28 (3) "cigarette" has the meaning given in AS 43.50.170; 29 (4) "licensee" means a person licensed by the department under 30 AS 43.50.010 or 43.50.035 to sell, distribute, purchase, possess, or acquire cigarettes; 31 (5) "package" means the individual packet, box, or other container,
01 originating from the manufacturer, in which retail sales of cigarettes are normally 02 made or intended to be made; "package" does not include containers that are cartons, 03 cases, bales, or boxes that contain packages of cigarettes; 04 (6) "person" has the meaning given in AS 43.50.170; 05 (7) "shipping container" means the case, box, parcel, or other container 06 in which cartons or packages of cigarettes are placed for shipment or transportation 07 from one place to another; "shipping container" does not include a package in which 08 retail sales of cigarettes are normally made or intended to be made; 09 (8) "stamp" means a stamp or other indicium that is 10 (A) printed, manufactured, or made under authorization of the 11 department under this chapter; 12 (B) issued, sold, or circulated by the department; and 13 (C) used to pay the cigarette taxes levied under this chapter; 14 (9) "unstamped cigarettes" means a package containing cigarettes that 15 is not affixed with the stamp required by AS 43.50.500 - 43.50.700. 16 * Sec. 16. AS 43.50.080 is repealed. 17 * Sec. 17. The uncodified law of the State of Alaska is amended by adding a new section to 18 read: 19 TRANSITION: REGULATIONS. Notwithstanding sec. 20 of this Act, the 20 Department of Revenue may immediately proceed to adopt regulations necessary to 21 implement the changes made by this Act. The regulations take effect under AS 44.62 22 (Administrative Procedure Act), but not before the effective date of the respective statutory 23 changes. 24 * Sec. 18. The uncodified law of the State of Alaska is amended by adding a new section to 25 read: 26 TRANSITION: ACTIVITIES INVOLVING UNSTAMPED CIGARETTES 27 THROUGH MARCH 31, 2004. (a) Notwithstanding the requirements of AS 43.50.500 - 28 43.50.700, enacted by sec. 15 of this Act, a person may acquire, hold, own, import, possess, 29 sell, distribute, or consume unstamped cigarettes in this state on or after January 1, 2004, and 30 on or before March 31, 2004, if the cigarettes were in this state before January 1, 2004. 31 (b) In this section, "unstamped cigarettes" has the meaning given in AS 43.50.700,
01 enacted by sec. 15 of this Act. 02 * Sec. 19. Section 17 of this Act takes effect immediately under AS 01.10.070(c). 03 * Sec. 20. Except as provided in sec. 19 of this Act, this Act takes effect January 1, 2004.