Section 804 – Taxation of electronic cigarette substance, prefilled electronic cigarette, alternative nicotine product, nontherapeutic nicotine device substance, and prefilled nontherapeutic nicotine device.

• (1)
  • (a) Beginning on July 1, 2020, a tax is imposed upon the following:
    • (i) an electronic cigarette substance; and
    • (ii) a prefilled electronic cigarette.
  • (b) Beginning on July 1, 2021, a tax is imposed upon the following:
    • (i) a nontherapeutic nicotine device substance; and
    • (ii) a prefilled nontherapeutic nicotine device.
  • (c) Beginning on July 1, 2021, a tax is imposed upon an alternative nicotine product.

• (2)
  • (a) The amount of tax imposed under Subsections (1)(a) and (b) is .56 multiplied by the manufacturer’s sales price.
  • (b)
    • (i) The tax under Subsection (1)(c) on an alternative nicotine product is imposed:
      • (A) at a rate of $1.83 per ounce; and
      • (B) on the basis of the net weight of the alternative nicotine product as listed by the manufacturer.
    • (ii) If the net weight of the alternative nicotine product is in a quantity that is a fractional part of one ounce, a proportionate amount of the tax described in Subsection (2)(b)(i)(A) is imposed:
      • (A) on that fractional part of one ounce; and
      • (B) in accordance with rules made by the commission in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.

• (3) If a product is sold in the same package as a product that is taxed under Subsection (1), the tax described in Subsection (2) shall apply to the wholesale manufacturer’s sale price of the entire packaged product.

• (4)
  • (a) A manufacturer, jobber, distributor, wholesaler, retailer, consumer, or user shall pay the tax levied under Subsection (1) at the time that an electronic cigarette substance, a prefilled electronic cigarette, an alternative nicotine product, a nontherapeutic nicotine device substance, or a prefilled nontherapeutic nicotine device is first received in the state.
  • (b) A manufacturer, jobber, distributor, wholesaler, retailer, consumer, or user may not resell an electronic cigarette substance, a prefilled electronic cigarette, an alternative nicotine product, a nontherapeutic nicotine device substance, or a prefilled nontherapeutic nicotine device to another distributor, another retailer, or a consumer before paying the tax levied under Subsection (1).

• (5)
  • (a) The manufacturer, jobber, distributor, wholesaler, retailer, consumer, or user shall remit the taxes collected in accordance with this section to the commission.
  • (b) The commission shall deposit revenues generated by the tax imposed by this section into the Electronic Cigarette Substance and Nicotine Product Tax Restricted Account created in Section 59-14-807.

Enacted by Chapter 347, 2020 General Session