HCS HB 1267 -- CERTIFICATION OF TOBACCO PRODUCTS

SPONSOR:  Cooper (120)

COMMITTEE ACTION:  Voted "do pass" by the Committee on Tax Policy
by a vote of 18 to 0.

This substitute establishes certain requirements for tobacco
product manufacturers relating to the 1998 Master Settlement
Agreement between various tobacco companies and the State of
Missouri, 45 other states, the District of Columbia, and five
U. S. territories.

The substitute requires all tobacco manufacturers whose
cigarettes are sold in Missouri to report and certify to the
Department of Revenue each year that they are in compliance with
the Tobacco Settlement Model Statute currently in Missouri law.

In addition to the certification, tobacco product manufacturers
must provide a list of "brand families" of cigarette types, the
number of units sold for each family at any time during the year,
the name and address of any other manufacturer of their brand
families in the preceding or current calendar year, and other
information to verify compliance with the model statute.  Each
tobacco product manufacturer must maintain an agent within the
state for purposes of service of process relating to the
enforcement of the substitute.

The substitute also requires that by January 1, 2005, the
director must publish on its web site for public inspection a
list of all tobacco product manufacturers that have provided the
certification requirements established in the substitute.

Stamping agents (persons authorized to affix cigarette tax stamps
to cigarette packages) are required to submit to the director an
e-mail address for receipt of notifications as required and to
submit various reports and documents as required by the director.

Various penalties and actions for failure to comply with the
requirements of the substitute are included.

The substitute requires any tobacco product manufacturer who has
not made shipments of tobacco products into this state prior to
the effective date of the substitute to file a bond not to exceed
$50,000.  After a two-year period, the director will release the
manufacturer from the bonding requirement.

FISCAL NOTE:  No impact on General Revenue Fund in FY 2005, FY
2006, and FY 2007.  Estimated Income on Other State Funds of
Unknown in FY 2005, FY 2006, and FY 2007.

PROPONENTS:  Supporters say that the bill requires
nonparticipating manufacturers that are avoiding escrow payments
to register.

Testifying for the bill were National Association of Attorneys
General; Xcaliber International Ltd.; R. J. Reynolds Tobacco
Company; Missouri Retailers Association; and Premier
Manufacturing Incorporated.

OPPONENTS:  Those who oppose the bill say that it unfairly
penalizes certain tobacco product manufacturers and does not give
wholesalers and retailers of tobacco products the opportunity to
dispose of inventories after decertification.

Testifying against the bill were LPC, Incorporated; Dirt Cheap;
and U-Gas.

Karla Strobel, Legislative Analyst

Missouri House of Representatives
92nd General Assembly, 2nd Regular Session
Last Updated September 23, 2004 at 11:15 am