§ 26-57-803 - Additional tax -- Applicability. - Arkansas Statutes

26-57-803. Additional tax -- Applicability.

(a) (1) In addition to the excise or privilege taxes levied under 26-57-208 and 26-57-802, there is levied a tax of four dollars and seventy-five cents ($4.75) per one thousand (1,000) cigarettes sold in the state.

(2) Whenever there are two (2) adjoining cities, each with a population of five thousand (5,000) or more separated by a state line, the tax on cigarettes sold in such adjoining Arkansas city shall be at the rate imposed by law on cigarettes sold in the adjoining city outside of Arkansas plus the fifty cents (50cent(s)) per one thousand (1,000) cigarettes presently imposed by 26-57-802. The tax shall not exceed the tax upon cigarettes imposed by this subchapter.

(3) The tax on cigarettes sold in Arkansas within three hundred feet (300') of a state line, in any Arkansas city which adjoins a state line, or in any city that is separated only by a navigable river from a city that adjoins a state line shall be at the rate imposed by law on cigarettes sold in the adjoining state plus the twenty-five cents (25cent(s)) per one thousand (1,000) cigarettes presently imposed by 26-57-802. The tax shall not exceed the tax upon cigarettes imposed by this subchapter.

(4) (A) The tax on cigarettes shall be at the rate imposed by law on cigarettes sold in the adjoining state plus the additional tax levied by 26-57-802 when the cigarettes are sold in an Arkansas city or incorporated town whose corporate limits adjoin the corporate limits of an Arkansas border city.

(B) As used in subdivision (a)(4)(A) of this section, "Arkansas border city" means a city that is entitled to the border zone cigarette tax rate and is separated by a navigable river from a city in the other state that is located in a metropolitan statistical area designated by the United States Census Bureau with a population of at least one million (1,000,000).

(C) The tax shall not exceed the tax upon cigarettes otherwise imposed under Arkansas law.

(b) In addition to the tax imposed by 26-57-208(2), there is levied an additional excise or privilege tax on the sale of tobacco products other than cigarettes by wholesalers to retailers or by licensed retailers to the Director of the Department of Finance and Administration at seven percent (7%) of the manufacturer's selling price. The tax shall be computed before discounts.

(c) (1) (A) The taxes levied by this section shall be reported and paid by wholesalers licensed pursuant to 26-57-214.

(B) However, retailers shall be liable for reporting and paying these taxes when a retailer purchases tobacco products directly from a manufacturer or from a wholesaler or distributor not licensed pursuant to 26-57-214.

(2) (A) Any taxpayer who fails to report and remit the tobacco tax due on tobacco products purchased from manufacturers, distributors, or wholesalers who are not licensed under 26-57-214 shall be subject to the following penalties:

(i) Five percent (5%) of the total tobacco tax due for the first offense;

(ii) Twenty percent (20%) of the total tobacco tax due for the second offense; and

(iii) Twenty-five percent (25%) of the total tobacco tax due for the third and any subsequent offenses.

(B) In addition, the taxpayer's retail cigarette/tobacco permit shall be revoked for a period of ninety (90) days for the third and any subsequent offenses.

(3) The provisions of this subsection shall not affect the provisions of 26-57-228.

(d) As provided in 26-57-244, the director may make a direct assessment of excise tax against any person in possession of an untaxed tobacco product or unstamped cigarettes.