License Requirements for Retailers Selling Cigarette and Tobacco Products

Retail sellers of cigarettes and tobacco products in Minnesota must have a Minnesota Cigarette and Tobacco Product Retailer’s license prior to purchasing or selling cigarettes or tobacco products.

A separate license is required for each location or vending machine from which cigarettes or tobacco products are sold at retail.

Licenses are issued and administered by the city, county, or town in which the business is located.

License Display

You must conspicuously display your license at each retail location so that it is visible to the public, according to your licensing authority’s rule.

Records

Retailers must:

• Keep a legible copy of each invoice for one year from the date of the invoice or as long as the cigarette or tobacco product listed on the invoice is available for sale or in their possession, whichever period is longer
• Keep copies of the invoices at each retail location or at a central location
• Provide copies at a retail location within one hour when requested by Revenue

Copies should be numbered and kept in chronological order.

For more information about invoice records, go to Record Retention for Cigarette and Tobacco Product Invoices.

Purchases

You must purchase your inventory of cigarettes and other tobacco products from a licensed Minnesota cigarette and/or tobacco distributor or subjobber. View our licensed Cigarette and Tobacco Distributors List.

If you make purchases of cigarettes or tobacco products from other sources, you are subject to civil and criminal penalties, and possible seizure of your cigarettes and tobacco products.

Sales

You must only sell Minnesota-stamped cigarettes or tobacco products on which Minnesota tax has been paid.

You are not allowed to sell cigarettes below cost, as determined by the Minnesota Department of Commerce under the Minnesota Unfair Cigarette Sales Act (UCSA). UCSA is law enacted to protect the public by prohibiting sales of cigarettes at below wholesale or retail cost. For more information about cigarette pricing, go to Cigarettes on Commerce’s website.

If you possess or make illegal sales of cigarettes or tobacco products, you are subject to civil and criminal penalties, and possible seizure of your cigarettes and tobacco products.

Inspections

You must allow Revenue staff — without a search warrant — to enter your place of business and inspect the premises, the records you are required to keep, and the packages of cigarettes, tobacco products, and vending devices on the premises. For more information about our inspections, go to Compliance Checks of Cigarette and Tobacco Retailers.

Criminal penalties are in addition to any civil penalties that may be imposed.

Unstamped Cigarettes or Untaxed Tobacco Products

It is illegal for any person, other than a licensed distributor or a consumer, to possess, receive, or transport unstamped cigarettes or untaxed tobacco products.

It is presumed that any individual possessing more than 4,999 unstamped cigarettes or more than $350 worth of untaxed tobacco products is not a consumer.

If you, directly or indirectly, purchase for resale cigarettes without the proper stamp affixed, your sales and use tax permit may be revoked.

Sales of Cigarette Packages with Indian Stamp

If you are not located on an Indian reservation, it is illegal for you to sell or offer to sell cigarette packages with Indian stamps.

Sales after License Revocation

If you sell cigarettes or tobacco products after your license has been revoked, you are guilty of a felony.

Purchases from Unlicensed Sellers

It is illegal for you to purchase cigarettes or tobacco products from any person who is not a Minnesota licensed distributor or subjobber.

If you purchase for resale from an unlicensed seller more than 20,000 cigarettes or $500 or more worth of tobacco products, your Sales and Use Tax permit may be revoked.

Any other violation of state law, unless otherwise specified, is a misdemeanor.

If you suspect Cigarette or Tobacco Tax violations, please report it to us. You may remain anonymous.

Email: tax.fraud@state.mn.us

Phone: 651-297-5195 or 1-800-657-3500 (toll-free)

Fax: 651-556-3105