USC Subchapter G

in effect

26 U.S.C. § 5761 Civil penalties

(a) Omitting things required or doing things forbiddenWhoever willfully omits, neglects, or refuses to comply with any duty imposed upon him by this chapter, or to do, or cause to be done, any of the things required by this chapter, or does anything prohibited by this chapter, shall in addition to any other penalty provided in this title, be liable to a penalty of $1,000, to be recovered, with costs of suit, in a civil action, except where a penalty under subsection (b) or (c) or under section 6651 or 6653 or part II of subchapter A of chapter 68 may be collected from such person by assessment. (b) Failure to pay taxWhoever fails to pay any tax imposed by this chapter at the time prescribed by law or regulations, shall, in addition to any other penalty provided in this title, be liable to a penalty of 5 percent of the tax due but unpaid. (c) Sale of tobacco products and cigarette papers and tubes for exportExcept as provided in subsections (b) and (d) of section 5704—(1) every person who sells, relands, or receives within the jurisdiction of the United States any tobacco products or cigarette papers or tubes which have been labeled or shipped for exportation under this chapter, (2) every person who sells or receives such relanded tobacco products or cigarette papers or tubes, and (3) every person who aids or abets in such selling, relanding, or receiving, shall, in addition to the tax and any other penalty provided in this title, be liable for a penalty equal to the greater of $1,000 or 5 times the amount of the tax imposed by this chapter. All tobacco products and cigarette papers and tubes relanded within the jurisdiction of the United States shall be forfeited to the United States and destroyed. All vessels, vehicles, and aircraft used in such relanding or in removing such products, papers, and tubes from the place where relanded, shall be forfeited to the United States. This subsection and section 5754 shall not apply to any person who relands or receives tobacco products in the quantity allowed entry free of tax and duty under subchapter IV of chapter 98 of the Harmonized Tariff Schedule of the United States. No quantity of tobacco products other than the quantity referred to in the preceding sentence may be relanded or received as a personal use quantity. (d) Personal use quantities(1) In generalNo quantity of tobacco products other than the quantity referred to in paragraph (2) may be relanded or received as a personal use quantity. (2) Exception for personal use quantitySubsection (c) and section 5754 shall not apply to any person who relands or receives tobacco products in the quantity allowed entry free of tax and duty under chapter 98 of the Harmonized Tariff Schedule of the United States, and such person may voluntarily relinquish to the Secretary at the time of entry any excess of such quantity without incurring the penalty under subsection (c). (3) Special rule for delivery sales(A) In generalParagraph (2) shall not apply to any tobacco product sold in connection with a delivery sale. (B) Delivery saleFor purposes of subparagraph (A), the term “delivery sale” means any sale of a tobacco product to a consumer if—(i) the consumer submits the order for such sale by means of a telephone or other method of voice transmission, the mail, or the Internet or other online service, or the seller is otherwise not in the physical presence of the buyer when the request for purchase or order is made, or (ii) the tobacco product is delivered by use of a common carrier, private delivery service, or the mail, or the seller is not in the physical presence of the buyer when the buyer obtains personal possession of the tobacco product. (e) Applicability of section 6665The penalties imposed by subsections (b) and (c) shall be assessed, collected, and paid in the same manner as taxes, as provided in section 6665(a). (f) Cross referencesFor penalty for failure to make deposits or for overstatement of deposits, see section 6656.

26 U.S.C. § 5762 Criminal penalties

(a) Fraudulent offensesWhoever, with intent to defraud the United States—(1) Engaging in business unlawfullyEngages in business as a manufacturer or importer of tobacco products or cigarette papers and tubes, or as an export warehouse proprietor, without filing the bond and obtaining the permit where required by this chapter or regulations thereunder; or (2) Failing to furnish information or furnishing false informationFails to keep or make any record, return, report, or inventory, or keeps or makes any false or fraudulent record, return, report, or inventory, required by this chapter or regulations thereunder; or (3) Refusing to pay or evading taxRefuses to pay any tax imposed by this chapter, or attempts in any manner to evade or defeat the tax or the payment thereof; or (4) Removing tobacco products or cigarette papers or tubes unlawfullyRemoves, contrary to this chapter or regulations thereunder, any tobacco products or cigarette papers or tubes subject to tax under this chapter; or (5) Purchasing, receiving, possessing, or selling tobacco products or cigarette papers or tubes unlawfullyViolates any provision of section 5751(a)(1) or (a)(2); or (6) Destroying, obliterating, or detaching marks, labels, or notices before packages are emptiedViolates any provision of section 5752; shall, for each such offense, be fined not more than $10,000, or imprisoned not more than 5 years, or both. (b) Other offensesWhoever, otherwise than as provided in subsection (a), violates any provision of this chapter, or of regulations prescribed thereunder, shall, for each such offense, be fined not more than $1,000, or imprisoned not more than 1 year, or both.

26 U.S.C. § 5763 Forfeitures

(a) Tobacco products and cigarette papers and tubes unlawfully possessed(1) Tobacco products and cigarette papers and tubes possessed with intent to defraudAll tobacco products and cigarette papers and tubes which, after removal, are possessed with intent to defraud the United States shall be forfeited to the United States. (2) Tobacco products and cigarette papers and tubes not property packagedAll tobacco products and cigarette papers and tubes not in packages as required under section 5723 or which are in packages not bearing the marks, labels, and notices, as required under such section, which, after removal, are possessed otherwise than with intent to defraud the United States, shall be forfeited to the United States. This paragraph shall not apply to tobacco products or cigarette papers or tubes sold or delivered directly to consumers from proper packages. (b) Personal property of qualified manufacturers, qualified importers, and export warehouse proprietors, acting with intent to defraudAll tobacco products and cigarette papers and tubes, packages, machinery, fixtures, equipment, and all other materials and personal property on the premises of any qualified manufacturer or importer of tobacco products or cigarette papers and tubes, or export warehouse proprietor, who, with intent to defraud the United States, fails to keep or make any record, return, report, or inventory, or keeps or makes any false or fraudulent record, return, report, or inventory, required by this chapter; or refuses to pay any tax imposed by this chapter, or attempts in any manner to evade or defeat the tax or the payment thereof; or removes, contrary to any provision of this chapter, any article subject to tax under this chapter, shall be forfeited to the United States. (c) Real and personal property of illicit operatorsAll tobacco products, cigarette papers and tubes, machinery, fixtures, equipment, and other materials and personal property on the premises of any person engaged in business as a manufacturer or importer of tobacco products or cigarette papers and tubes, or export warehouse proprietor, without filing the bond or obtaining the permit, as required by this chapter, together with all his right, title, and interest in the building in which such business is conducted, and the lot or tract of ground on which the building is located, shall be forfeited to the United States. (d) GeneralAll property intended for use in violating the provisions of this chapter, or regulations thereunder, or which has been so used, shall be forfeited to the United States as provided in section 7302.