(102)
Definitions. For the purposes of this rule, the following
definitions apply:
(a) "Board" means the
liquor and cannabis board.
(b)
"Business" includes all activities engaged in with the object of gain, benefit,
or advantage to the taxpayer or to another person or class, directly or
indirectly, including any trade, occupation, activity, or enterprise engaged in
for the purpose of selling or distributing cigarettes in this state.
(c) "Cigarette" means any roll for smoking
made wholly or in part of tobacco, irrespective of size or shape and
irrespective of the tobacco being flavored, adulterated, or mixed with any
other ingredient, where such roll has a wrapper or cover made of paper or any
material, except where such wrapper is wholly or in the greater part made of
natural leaf tobacco in its natural state. Cigarette includes a roll-your-own
cigarette.
(d) "Cigarette paper"
means any paper or any other material except tobacco, prepared for use as a
cigarette wrapper.
(e) "Cigarette
tube" means cigarette paper made into a hollow cylinder for use in making
cigarettes.
(f) "Commercial
cigarette-making machine" means a machine that is operated in a retail
establishment and that is capable of being loaded with loose tobacco, cigarette
paper or tubes, and any other components related to the production of
roll-your-own cigarettes, including filters.
(g) "Department" means the department of
revenue.
(h) "Governmental entity"
means:
(i) The United States;
(ii) The state of Washington (state)
including, its departments and institutions, as distinct from its corporate
agencies or instrumentalities; and
(iii) Any municipal corporation or political
subdivision of the state of Washington.
(i) "Indian tribal organization" means a
federally recognized Indian tribe, or tribal entity, and includes an Indian
wholesaler or retailer that is owned by an Indian who is an enrolled tribal
member conducting business under tribal license or similar tribal approval
within Indian country. For purposes of this rule, the terms "Indian," "Indian
country," and "Indian tribe" have the same meaning as defined in WAC
458-20-192.
(j) "Manufacture" means the production,
assembly, or creation of new cigarettes. For the purposes of this rule,
"manufacture" does not necessarily have the same meaning as provided in
RCW
82.04.120.
(k) "Manufacturer" means a person who
manufactures and sells cigarettes.
(l) "Municipal corporation or political
subdivision of the state of Washington" means any county, city, town, school
district, fire protection district, or other authority identified as a
municipal corporation or political subdivision of the state of Washington by
statute and that qualifies for the property tax exemption provided by Article
VII of the Washington state Constitution.
(m) "Person" means any individual, receiver,
administrator, executor, assignee, trustee in bankruptcy, trust, estate, firm,
copartnership, joint venture, club, company, joint stock company, business
trust, municipal corporation, political subdivision of the state of Washington,
corporation, limited liability company, association, society, or any group of
individuals acting as a unit, whether mutual, cooperative, fraternal,
nonprofit, or otherwise and the United States or any instrumentality
thereof.
(n) "Place of business"
means any location where business is transacted with, or sales are made to,
customers. The term includes, but is not limited to, any vending machine and
any vehicle, truck, vessel or the like at which sales are made.
(o) "Possession" means both:
(i) Physical possession by the purchaser;
and
(ii) When cigarettes are being
transported to or held for the purchaser or his or her designee by a person
other than the purchaser, constructive possession by the purchaser or his or
her designee, which constructive possession is deemed to occur at the location
of the cigarettes being so transported or held.
(p) "Retailer" means every person, other than
a wholesaler, who purchases, sells, offers for sale or distributes any one or
more of the articles taxed herein, irrespective of quantity or amount, or the
number of sales, and all persons operating under a retailer's registration
certificate.
(q) "Roll-your-own
cigarettes" means cigarettes produced by a commercial cigarette-making
machine.
(r) "Sale" means any
transfer of the ownership of, title to, or possession of property for a
valuable consideration.
(s) "Stamp"
means any stamp authorized by the state of Washington, including the stamp or
stamps by use of which the cigarette tax is paid or identification is made of
those cigarettes with respect to which no tax is imposed.
(t) "United States" means:
(i) The federal government, including the
executive, legislative, and judicial branches, its departments, and federal
entities exempt from state or local taxation by reason of specific federal
statutory exemption.
The mere fact that an entity is a federal entity, such as an
instrumentality of the federal government or a federal corporation, does not
mean that the entity is immune from tax. The taxability of a federal entity
depends on the benefits and immunities conferred upon it by Congress. Thus, to
determine the current taxable status of federal entities, the relevant portion
of the federal law should be examined.
(ii) "United States" does not include
entities associated with, but not a part of the United States, such as the
National Guard (an instrumentality of the state of Washington). Nor does it
include entities contracting with the United States government to administer
its programs.
(u)
"Wholesaler" means every person who purchases, sells, or distributes cigarettes
to retailers for the purpose of resale only.
(103)
Imposition of tax. The
cigarette tax is imposed on the first person to sell, use, consume, handle,
possess, or distribute cigarettes in Washington. Please refer to subsection
(302) of this rule for an explanation of the measure and rate of the tax.
(a)
Payment. Payment of the
cigarette tax is made through the purchase of stamps from banks authorized by
the department to sell the stamps. Please refer to subsection (301) of this
rule for an explanation of stamping requirements.
(b)
Possession of cigarettes in
Washington state.(i) Every person (A)
in possession of unstamped cigarettes in this state, and (B) not specifically
exempt by law, is liable for payment of the cigarette tax as provided in
chapter 82.24 RCW and this rule.
(ii) Active duty or retired military
personnel, and their dependents, may purchase cigarettes for their own
consumption on military reservations without paying the state tax (see Part V).
However, such persons are not permitted to give or resell those cigarettes to
others.
(iii) Possession of
unstamped and untaxed cigarettes, and possession of counterfeit cigarettes, are
criminal offenses in this state. See Part VII.