taxes

Cigar and Tobacco Products Tax

Who is responsible for this tax?

A permit holder who receives cigars and tobacco products for the purpose of making a first sale in this state.

In addition to submitting Form AP-193, Texas Application for Retailer Cigarette, Cigar and/or Tobacco Products Taxes Permit (PDF), a retailer must have an active sales tax permit (Form AP-201, Texas Application (PDF)) for each commercial business location.

Permit Fees

  • Distributors, manufacturers with representation in Texas, and bonded agents – $300 per annual permit year from March 1 through last day of February of following year. Distributors who sell cigarettes and tobacco products must obtain a permit for each vehicle used – $15 per annual licensing period.
  • Wholesalers – $200 per annual permit year from March 1 through last day of February of following year. Wholesalers who sell cigarettes and tobacco products must obtain a permit for each vehicle used – $15 per annual licensing period.
  • Importers – no fee.
  • Manufacturers with no representation in Texas – no fee.
  • Retailers – $180 for permits issued or renewed. Retailer permits are issued for a two-year period of June 1 through May 31 of even-numbered years.

The Comptroller will not issue refunds for locations closing before the permit expiration date.

Rates

Cigars
  • One cent per 10 or fraction of 10 on cigars weighing three pounds or less per thousand;
  • $7.50 per thousand on cigars that weigh more than three pounds per thousand, sell at factory list price, exclusive of any trade discount, special discount, or deal, for 3.3 cents or less each;
  • $11 per thousand on cigars that weigh more than three pounds per thousand, sell at factory list price, exclusive of any trade discount, special discount, or deal, for more than 3.3 cents each and contain no substantial amount of non-tobacco ingredients; and
  • $15 per thousand on cigars that weigh more than three pounds per thousand, sell at factory list price, exclusive of any trade discount, special discount, or deal, for more than 3.3 cents each and contain a substantial amount of non-tobacco ingredients.
Other Tobacco Products (smoking and chewing tobacco, snuff)

The tax rate is based on the current state fiscal year. The rate applies to each ounce of net product weight and all fractional parts of an ounce. A tax rate in effect for a state fiscal year does not affect taxes imposed before that fiscal year, and the rate in effect when those taxes were imposed continues in effect for purposes of the liability for and collection of those taxes.

Following are the rates by state fiscal year.

Fiscal Year Rate
2010 (Sept. 1, 2009 - Aug. 31, 2010) $1.10 per ounce*
2011 (Sept. 1, 2010 - Aug. 31, 2011) $1.13 per ounce*
2012 (Sept. 1, 2011 - Aug. 31, 2012) $1.16 per ounce*
2013 (Sept. 1, 2012 - Aug. 31, 2013) $1.19 per ounce*
2014 (Sept. 1, 2013 and each fiscal year thereafter) $1.22 per ounce*

*Plus the proportionate rate on all fractional parts of an ounce.

Tax Rate Table for State Fiscal Year 2014 and thereafter

The following table is provided as a guide and shows the actual tax rates and proportionate rates for fractional parts of an ounce, up to two ounces, to use from Sept. 1, 2013, and thereafter.

Total Ounces In Can Or Package Tax For An Individual Can Or Package
1.2 ounces or less $1.46
1.3 ounces $1.59
1.4 ounces $1.71
1.5 ounces $1.83
1.6 ounces $1.95
1.7 ounces $2.07
1.8 ounces $2.20
1.9 ounces $2.32
2.0 ounces $2.44

For tax rates for individual cans or packages weighing up to 15 ounces for state fiscal years 2010 and beyond, view an expanded chart.

Due Date

Manufacturers
Report monthly on the last day of each month for the preceding month’s activity.

Distributors
Beginning with the August 2017 report, distributors report monthly on the 25th day of each month for the preceding month’s activity.

For reports before August 2017, distributors report monthly on the last day of each month for the preceding month’s activity.

Penalties and Interest

Penalties

A minimum penalty of $50 is due for failure to pay the fee on or before the due date.

  • If tax is paid 1-30 days after the due date, a 5 percent penalty is assessed.
  • If tax is paid over 30 days after the due date, a 10 percent penalty is assessed.
Interest

Reporting and Payment Requirements

Select the amount of taxes you paid in the preceding state fiscal year (Sept. 1 – Aug. 31) to find the reporting and payment methods to use.

Less than $100,000

A paper report is the only available reporting method.

Select one of these payment methods:

  • Web Electronic Funds Transfer (EFT) or credit card via Webfile (American Express, Discover and MasterCard)
  • TEXNET
  • Check
$100,000 or more

A paper report is the only available reporting method.

TEXNET is the only acceptable payment method.

Additional Resources