Rhode Island Code of Regulations
Title 280 - Department of Revenue
Chapter 20 - Division of Taxation
Subchapter 15 - Cigarette Tax
Part 1 - Cigarette Tax (280-RICR-20-15-1)
Section 280-RICR-20-15-1.16 - Minimum Pricing of Cigarettes

A. Pursuant to R.I. Gen. Laws § 44-20-8, the Tax Administrator may suspend or revoke any license under R.I. Gen. Laws Chapter 44-20 for failure of the licensee to comply with any provision of R.I. Gen. Laws Chapter 6-13 entitled "Unfair Sales Practices."

B. No licensee shall advertise, offer to sell, or sell cigarettes at a price that is less than the applicable presumptive cost without obtaining the Tax Administrator's prior written approval. The Tax Administrator may periodically announce the retailers' and wholesalers' presumptive cost. The Tax Administrator may suspend or revoke any license if the licensee advertises, offers to sell, or sells cigarettes at less than the applicable presumptive cost without the Tax Administrator's prior written approval.

C. Example:

The cost of a carton of cigarettes to a licensed cigarette distributor is $100.00. This includes the cost from the manufacturer, and cigarette tax paid per R.I. Gen. Laws § 44-20-12, for the carton of cigarettes. The wholesaler/distributor's presumptive cost of selling cigarettes, or the minimum price from a distributor to a dealer, without a delivery cost, is $102.00 ($100*102%). The cartage cost to the retail outlet, or the minimum price including delivery cost, from a distributor to a dealer, is $102.77 ($102*100.75%). The retailer/dealer's presumptive cost of selling cigarettes, or the dealer's minimum price to the consumer, is $108.96 ($102.77*106%) per carton.