Let us shed light on compliance checks that cigarette and tobacco retailers must follow, as highlighted by reputed accountants in Minneapolis:
- The main goal of compliance checks is to prevent selling tobacco products to minors or persons who purchase them without considering the legal restrictions. It will prevent underage tobacco use and impose regulations to protect public health.
- These laws consider minimum age requirements for buying tobacco products, abstain individuals from selling specific tobacco products like flavored cigarettes, and avoid advertising and promoting products at all costs.
- While performing complaince checks, retailers are expected to verify their age and identity to the customers for purchasing the products. A driver’s license or passport is often considered valid proof.
- Penalties will be charged to those selling the products to an underage individual or violating any regulation; they might face penalties and consequences that can be prevented with the guidance and support of tax accountants.
The Minnesota Department of Revenue is responsible for monitoring compliance with Minnesota Cigarette and Tobacco Tax laws. Our enforcement efforts aim to protect the state tax base and protect legitimate businesses from unfair competition.
What we do
We help taxpayers understand these taxes and enforce compliance with the law by:
- Educating retailers, suppliers and consumers about their tax obligations
- Auditing and investigating the cigarette and tobacco product records of retailers and suppliers
- Enforcing the Cigarette Tax and Tobacco Tax laws by:
- Assessing tax and civil penalties against people who do not comply with the law
- Seizing contraband cigarettes and tobacco products on which tax has not been paid
- Seeking criminal prosecution against people who intentionally evade cigarette and tobacco taxes
The inspection
One way we monitor compliance is by conducting random inspections of cigarette and tobacco retailers. During these visits, we:
- Inspect the retailer’s cigarette and tobacco inventory
- Check the retailer’s license to sell cigarette or tobacco products
- Review the retailer’s invoices from cigarette and tobacco suppliers
Inspecting cigarette stamps
During the inspection, we examine the cigarette inventory to verify that:
- Each pack of cigarettes is properly stamped in compliance with Minnesota law (the stamps must be completely intact and all 10 numbers legible to identify the distributor)
- The stamps are authentic and not counterfeit
Any pack of cigarettes that is not properly stamped is considered contraband and we may confiscate it.
Invoices
Under Minnesota law, all retailers must buy their cigarettes and tobacco products from a licensed distributor or sub jobber who paid the tax on the product.
A list of distributors is available on our website. Go to www.revenue.state.mn.us and enter Distributor List in the Search box.
Retailers must also keep a legible copy of all purchase invoices for at least one year from the invoice date. These invoices must be kept at the retail location or a central location, and must be produced within one hour after we request them.
If a retailer cannot produce invoices for cigarettes or tobacco products within an hour of our request, the products are considered contraband under state law and we may seize them.
“Invoice” means a detailed list of cigarettes and tobacco products purchased or sold in this state that contains the following information:
- Name of seller
- Name of purchaser
- Date of sale
- Invoice number
- Itemized list of goods sold including brands of cigarettes and number of cartons of each brand, unit price, and identification of tobacco products by name, quantity, and unit price
- Any rebates, discounts, or other reductions
To ensure compliance, staying updated with laws and regulations related to tobacco sales in the jurisdiction is vital. A well-established CPA Minnesota, like Prudent Accountants, can save your business by updating you about these checks and maintaining records for smooth business operation. Consult the experts today! For more detailed and specific information, you can visit Compliance Checks for Cigarette and Tobacco Retailers – Minnesota Department of Revenue.
