Stamp Tax

V.S.A. tit. 32, ch. 205, subch. 3

in effect

32 V.S.A. § 7771 Rate of tax

7771. Rate of tax (a) A tax is imposed on all cigarettes, little cigars, and roll-your-own tobacco held in this State by any person for sale, unless such products shall be: (1) in the possession of a licensed wholesale dealer; (2) in the course of transit and consigned to a licensed wholesale dealer or retail dealer; or (3) in the possession of a retail dealer who has held the products for 24 hours or less. (b) Payment of the tax on cigarettes under this section shall be evidenced by the affixing of stamps to the packages containing the cigarettes. Where practicable, the Commissioner may also require that stamps be affixed to packages containing little cigars or roll-your-own tobacco. Any cigarette, little cigar, or roll-your-own tobacco on which the tax imposed by this section has been paid, such payment being evidenced by the affixing of such stamp or such evidence as the Commissioner may require, shall not be subject to a further tax under this chapter. Nothing contained in this chapter shall be construed to impose a tax on any transaction the taxation of which by this State is prohibited by the constitution of the United States. The amount of taxes advanced and paid by a licensed wholesale dealer as herein provided shall be added to and collected as part of the retail sale price on the cigarettes, little cigars, or roll-your-own tobacco. (c) A tax is also imposed on all cigarettes, little cigars, and roll-your-own tobacco possessed in this State by any person for any purpose other than sale as follows: (1) This tax shall not apply to: (A) Products bearing a stamp affixed pursuant to this chapter. (B) Products bearing a tax stamp affixed pursuant to the laws of another jurisdiction with a tax rate equal to or greater than the rate set forth in this subsection (c). (C) Products purchased outside the State by an individual in quantities of 400 or fewer cigarettes, little cigars, and 0.0325 ounce units of roll-your-own tobacco, and brought into the State for that individual’s own use or consumption. Products that are ordered from a source outside the State and delivered into this State are not “purchased outside the State” within the meaning of this subsection (c). (2) There is allowed a credit against the tax under this subsection for cigarette, little cigars, or roll-your-own tobacco tax paid to another jurisdiction and evidenced by tax stamps affixed to the subject products pursuant to the laws of that jurisdiction. (3) A person taxable under this section shall, within 30 days of first possessing the products in this State, file a return with the Commissioner showing the quantity of products brought into the State. The return must be made in the form and manner prescribed by the Commissioner and be accompanied by remittance of the tax due. (d) The tax imposed under this section shall be at the rate of 154 mills per cigarette or little cigar and for each 0.0325 ounces of roll-your-own tobacco. The interest and penalty provisions of section 3202 of this title shall apply to liabilities under this section. Amended 1959, No. 243, § 1; 1963, No. 226, § 1, eff. July 3, 1963; 1965, No. 41, § 1, eff. April 28, 1965; 1965, No. 131, § 1; 1969, No. 144, § 12, eff. June 1, 1969; 1981, No. 31, § 8; 1983, No. 2 (Sp. Sess.), § 3, eff. July 28, 1983; 1991, No. 32, § 23-25; 1995, No. 14, § 6, eff. April 12, 1995; 1995, No. 29, § 14, eff. April 14, 1995; 2001, No. 140 (Adj. Sess.), §§ 24, 26, eff. June 21, 2002; 2005, No. 191 (Adj. Sess.), § 37; 2005, No. 207 (Adj. Sess.), § 3, eff. May 31, 2006; 2009, No. 1 (Sp. Sess.), § H.37; 2009, No. 160 (Adj. Sess.), § 35; 2011, No. 45, § 27; 2013, No. 174 (Adj. Sess.), § 38; 2015, No. 54, § 49; 2015, No. 57, § 74, eff. June 11, 2015; 2021, No. 105 (Adj. Sess.), § 565, eff. July 1, 2022; 2023, No. 6, § 387, eff. July 1, 2023.

32 V.S.A. § 7772 Form and sale of stamps

7772. Form and sale of stamps (a) The Commissioner shall secure stamps of such designs and denominations as he or she shall prescribe to be affixed to packages of cigarettes as evidence of the payment to the tax imposed by this chapter. The Commissioner shall sell such stamps to licensed wholesale dealers at a discount of two and three-tenths percent of their face value for payment at time of sale. (b) At the purchaser’s request, the Commissioner may sell stamps to be affixed to packages of cigarettes as evidence of the payment to the tax imposed by this chapter to licensed wholesale dealers for payment within 10 days, at a discount of one and five-tenths percent of their face value if timely paid. In determining whether to sell stamps for payment within 10 days, the Commissioner shall consider the credit history of the dealer and the filing and payment history, with respect to any tax administered by the Commissioner, of the dealer or any individual, corporation, partnership, or other legal entity with which the dealer is or was associated as principal, partner, officer, director, employee, agent, or incorporator. (c) The Commissioner shall keep accurate records of all stamps sold to each wholesale dealer and shall pay over all receipts from the sale of stamps to the State Treasurer. Amended 1959, No. 243, § 3; 1963, No. 226, § 3, eff. July 3, 1963; 1965, No. 131, § 2; 1981, No. 31, § 9; 1983, No. 2 (Sp. Sess.), § 4, eff. July 28, 1983; 2001, No. 140 (Adj. Sess.), § 37; 2013, No. 73, § 9, eff. June 5, 2013; 2015, No. 57, § 75, eff. June 11, 2015.

32 V.S.A. § 7773 Use and redemption of stamps

7773. Use and redemption of stamps No licensed wholesale dealer shall sell or transfer any stamps issued under the provisions of this chapter. The Commissioner shall redeem at the amount paid therefor by the licensed wholesale or retail dealer any unused stamps issued under the provisions of this chapter, which are presented to him or her at his or her office in Montpelier. Amended 1981, No. 31, § 10; 2013, No. 14, § 14; 2015, No. 57, § 76, eff. June 11, 2015.

32 V.S.A. § 7774 Affixing stamps

7774. Affixing stamps Each licensed wholesale dealer shall affix or cause to be affixed to each individual package of cigarettes sold or distributed by him or her stamps of the proper denomination as required by section 7771 of this title and in such manner as the Commissioner may specify in regulations issued pursuant to this chapter. The stamps may be affixed by a licensed wholesale dealer at any time before the cigarettes are transferred out of his or her possession. Amended 1971, No. 73, § 28, eff. April 16, 1971; 1981, No. 31, § 11; 2013, No. 14, § 15.

32 V.S.A. § 7775 Retail dealers

7775. Retail dealers Within 24 hours after coming into possession of any cigarettes not bearing proper stamps evidencing payment of the tax imposed by this chapter and before selling the same, each retail dealer shall affix or cause to be affixed stamps of the proper denomination to each individual package of cigarettes as required by section 7771 of this title and in such manner as the Commissioner may specify in regulations issued pursuant to this chapter. Amended 2015, No. 57, § 77, eff. June 11, 2015.

32 V.S.A. § 7776 Collection of cigarette tax through nonresident licensed wholesale dealers

7776. Collection of cigarette tax through nonresident licensed wholesale dealers (a) When the Commissioner of Taxes finds that the collection of the tax imposed by this chapter would be facilitated thereby, the Commissioner may, in the Commissioner’s discretion, authorize any resident or nonresident person engaged in the business of manufacturing cigarettes or any resident or nonresident person who ships cigarettes into this State for sale to retail dealers in this State as defined in section 7702 of this title and who qualifies as a licensed wholesale dealer as defined in section 7702 of this title, but need not have a place of business in this State, upon complying with the requirements of the Commissioner to affix or cause to be affixed the stamps required by this chapter on behalf of the purchasers of such cigarettes who would otherwise be taxable therefor, and the Commissioner may sell such stamps to such person as provided in section 7772 of this title. (b) A nonresident person shall agree to submit the nonresident person’s books, accounts, and records to examination during reasonable business hours by the Commissioner or the Commissioner’s duly authorized agent. (c) A nonresident person authorized pursuant to subsection (a) of this section, other than a foreign corporation that the Secretary of State has authorized to do business in this State, shall, in writing, appoint the Secretary of State and the Secretary’s successors in office to be the nonresident person’s agent for service of process. Service upon the Secretary pursuant to this subsection constitutes sufficient service upon the nonresident person and may be made by delivering duplicate attested copies of the process to the Secretary. When legal process against the nonresident person is served upon the Secretary of State, the Secretary shall notify the nonresident person in the manner specified and shall collect the fee provided in 12 V.S.A. § 852 . (d) Any person complying with the provisions of this section shall thereupon become a licensed wholesale dealer within the meaning of this chapter and shall be subject to all provisions of the chapter applicable to wholesale dealers, including the furnishing of a bond specified in subchapter 2 of this chapter. (d) Any person complying with the provisions of this section shall thereupon become a licensed wholesale dealer within the meaning of 7 V.S.A. chapter 40 and this chapter and shall be subject to all provisions of both chapters applicable to wholesale dealers, including the furnishing of a bond specified in section 7703 of this chapter. Amended 1959, No. 231, § 5; 1971, No. 73, § 29, eff. April 16, 1971; 1981, No. 31, § 12; 2013, No. 14, § 16; 2021, No. 105 (Adj. Sess.), § 566, eff. July 1, 2022; 2025, No. 148 (Adj. Sess.), § 6, eff. July 1, 2027.

32 V.S.A. § 7777 Records required; inspection and examination; assessment of tax deficiency

7777. Records required; inspection and examination; assessment of tax deficiency (a) Each licensed wholesale dealer and each retail dealer shall keep complete and accurate records of all cigarettes, little cigars, and roll-your-own tobacco manufactured, produced, purchased, transferred, and sold by the dealer. The records shall be of such kind and in such form as the Commissioner may prescribe and shall be safely preserved for six years in such manner as to ensure permanency and accessibility for inspection by the Commissioner and authorized agents. The Commissioner or authorized agents of the Commissioner may enter in or upon any premises where the Commissioner or they have reason to believe that cigarettes, little cigars, or roll-your-own tobacco are possessed, stored, or sold, for the purpose of determining whether the provisions of this chapter or 33 V.S.A. chapter 19, subchapter 1A or 1B are being obeyed and may examine and copy the books, papers, records, and the stock of any licensed wholesale dealer or retail dealer, for the purpose of determining whether the tax imposed by this chapter has been fully paid. (b) If the Commissioner determines that a licensed wholesale dealer has not purchased sufficient stamps to cover sales of cigarettes and little cigars, or that a retail dealer has made sales of unstamped cigarettes or little cigars or untaxed roll-your-own tobacco, the Commissioner shall thereupon assess the deficiency in tax, plus interest and penalties as provided in section 3202 of this title. (c) In any case in which a licensed wholesale dealer cannot produce evidence of sufficient stamp purchases to cover the dealer’s receipts and sales or other disposition of cigarettes or little cigars, it shall be presumed that the cigarettes or little cigars were sold without having the proper stamps affixed. In any case in which a licensed wholesale dealer cannot produce proper evidence of payment of the tax on roll-your-own tobacco to cover the dealer’s receipts and sales or other disposition of roll-your-own tobacco, it shall be presumed that the roll-your-own tobacco was sold without the proper tax having been paid. (d) If a licensed wholesale dealer has failed to timely pay for stamps obtained for payment within 10 days or to pay the tax imposed on roll-your-own tobacco, the dealer shall be subject to assessment, collection, and enforcement in the same manner as provided under subchapter 4 of this chapter. (e) Any dealer who fails to pay the required tax to the Commissioner as required under this chapter shall be personally and individually liable for the amount of such tax, together with interest and penalties under the provisions of section 3202 of this title, and if the dealer is a corporation or other entity, the personal liability shall extend and be applicable to any officer or agent of the corporation or entity who, as an officer or agent, is under a duty to pay or transmit the tax to the Commissioner. (f) As an additional or alternate remedy, the Commissioner may issue a warrant directed to the sheriff of any county commanding him or her to levy upon and sell the real and personal property that may be found within the sheriff’s county of any person liable for tax under this chapter for the payment of the amount of the tax, penalties, and interest, and the cost of executing the warrant, and the sheriff shall return the warrant to the Commissioner and pay to the Commissioner the money collected by virtue thereof within 60 days after the receipt of the warrant. The sheriff shall, within five days after the receipt of the warrant, file with the county clerk a copy thereof, and thereupon the clerk shall enter in the judgment docket the name of the person mentioned in the warrant and the amount of the tax, penalties, and interest for which the warrant is issued and the date when the copy is filed. Thereupon the amount of the warrant so docketed shall become a lien upon the title to and interest in real and personal property of the person against whom the warrant is issued. The sheriff shall then proceed upon the warrant in the same manner and with like effect as that provided by law in respect to executions issued against property upon judgments of a court of record, and for services in executing the warrant, the sheriff shall be entitled to the same fees, which may be collected in the same manner. If a warrant is returned not satisfied in full, the Commissioner may from time to time issue new warrants and shall also have the same remedies to enforce the amount due thereunder as if the State had recovered judgment therefor and execution thereon had been returned unsatisfied. (g) If any dealer required to pay and transmit a tax under this chapter neglects or refuses to pay the same after demand, the amount, together with all penalties and interest provided for in this chapter and together with any costs that may accrue in addition thereto, shall be a lien in favor of the State of Vermont upon all property and rights to property, whether real or personal, belonging to such dealer. Such lien shall arise at the time demand is made by the Commissioner of Taxes and shall continue until the liability for such sum with interest, penalties, and costs is satisfied or becomes unenforceable. Such lien shall have the same force and effect as the lien for taxes withheld under the withholding provisions of the Vermont income tax law as provided under section 5895 of this title, and notice of such lien shall be recorded as is provided in that section. Certificates of release of such lien shall also be given by the Commissioner as in the case of the aforesaid tax liens. Amended 1971, No. 73, § 30, eff. April 16, 1971; 1981, No. 31, § 13; 1995, No. 169 (Adj. Sess.), § 18, eff. May 15, 1996; 2001, No. 140 (Adj. Sess.), § 38; 2003, No. 14, § 4; 2013, No. 14, § 17; 2015, No. 57, § 78, eff. June 11, 2015.

32 V.S.A. § 7778 Unstamped packages—Penalties

7778. Unstamped packages—Penalties (a) No person shall possess more than 10,000 cigarettes, or possess with the intent to sell any cigarettes, that do not bear stamps evidencing payment of tax imposed by this chapter. It shall be an affirmative defense to a charge under this subsection that such cigarettes are: (1) in the possession of a licensed wholesale dealer; (2) in the course of transit and consigned to a licensed wholesale dealer or retail dealer; or (3) in the possession of a retail dealer who has held them for 24 hours or less. (b) No person shall sell or transfer or offer for sale or display for sale any cigarettes that do not bear stamps evidencing payment of the tax imposed by this chapter. (c) No person shall use more than once any stamp provided for and required by this chapter. (d) Any person who shall violate any provision of this section shall, if the tax that may be imposed on such cigarettes is $500.00 or less, be imprisoned not more than one year or fined not more than $1,000.00, or both, or, if the tax that may be imposed on such cigarettes is more than $500.00, be imprisoned not more than three years or fined not more than $10,000.00, or both. Amended 1965, No. 194, § 10, operative February 1, 1967; 1971, No. 73, § 31, eff. April 16, 1971; 1973, No. 249 (Adj. Sess.), § 103, eff. April 9, 1974; 1981, No. 31, § 14; 1995, No. 29, § 15, eff. April 14, 1995.

32 V.S.A. § 7779 Seizure

7779. Seizure (a) Any cigarettes found at any place in this State without stamps affixed thereto as required by this chapter or any tobacco products found at any place in this State upon which the tax imposed by this chapter has not been paid, are declared to be contraband goods and may be seized without a warrant by the Commissioner, the Commissioner’s agents or employees, or by any peace officer of this State when directed by the Commissioner to do so, unless such cigarettes or tobacco products shall be in the possession of a licensed wholesale dealer, or unless they shall be in the course of transit and consigned to a licensed wholesale dealer or a retail dealer, or unless they shall have been received by a retail dealer within 24 hours. Nothing herein shall be construed to require the Commissioner to confiscate unstamped cigarettes or tobacco products when the Commissioner shall have reason to believe that the owner thereof has possession of the same for personal consumption or is not willfully or intentionally evading the tax imposed by this chapter. (b) Any cigarettes found at any place in this State with stamps affixed thereto which stamps have not been paid for as required by this chapter, are declared to be contraband goods and may be seized without a warrant by the Commissioner, the Commissioner’s agents or employees, or by any peace officer of this State when directed by the Commissioner to do so. (c) Any cigarettes or tobacco products seized under the provisions of this chapter shall be destroyed by the Commissioner. The seizure of any cigarettes or tobacco products under the provisions of this section shall not relieve any person from a fine or other penalty for violation of this chapter. Amended 1981, No. 31, § 15; 1995, No. 29, § 16, eff. April 14, 1995; 2001, No. 140 (Adj. Sess.), § 39.

32 V.S.A. § 7780 Hearing

7780. Hearing When any cigarettes or tobacco products shall have been seized under the provisions of section 7779 of this title, any person claiming an interest in such cigarettes or tobacco products who has not previously been heard or who has not waived hearing may make written application to the Commissioner for a hearing, stating an interest in the cigarettes or tobacco products and reasons why they should not be forfeited. Further proceedings on such application for hearing shall be taken as provided in sections 7782 and 7783 of this title. No cigarettes or tobacco products seized under the provisions of section 7779 of this title shall be destroyed while an application for a hearing is pending before the Commissioner, but the pendency of an appeal under the provisions of section 7783 of this title shall not prevent destruction of the cigarettes or tobacco products unless the appellant shall post a satisfactory bond, with surety, in an amount double the estimated value of the cigarettes or tobacco products conditioned upon the successful termination of the appeal. Amended 1995, No. 29, § 17, eff. April 14, 1995.

32 V.S.A. § 7781 Powers of officer conducting hearings

7781. Powers of officer conducting hearings The Commissioner and any agent of the Commissioner duly authorized to conduct any inquiry, investigation, or hearing hereunder shall have power to administer oaths and take testimony under oath relative to the matter of inquiry or investigation. At any hearing ordered by the Commissioner, the Commissioner or his or her agent authorized to conduct such hearing and having authority by law to issue such process may subpoena witnesses and require the production of books, papers, and documents pertinent to such inquiry. No witness under subpoena authorized to be issued by the provisions of this chapter shall be excused from testifying or from producing books or papers on the ground that such testimony or the production of such books or other documentary evidence would tend to incriminate him or her, but such evidence or the books or papers so produced shall not be used in any criminal proceeding against him or her. Officers who serve subpoenas issued by the Commissioner or under his or her authority and witnesses attending hearings conducted by him or her hereunder shall receive fees and compensation at the same rates as officers and witnesses in causes before a Criminal Division of the Superior Court, to be paid on vouchers of the Commissioner on order of the Commissioner of Finance and Management from the proper appropriation for the administration of this chapter. Amended 1965, No. 194, § 10, operative February 1, 1967; 1973, No. 193 (Adj. Sess.), § 3, eff. April 9, 1974; 1983, No. 195 (Adj. Sess.), § 5(b); 1983, No. 230 (Adj. Sess.), § 16; 2009, No. 154, § 238.

32 V.S.A. § 7782 Application for hearing

7782. Application for hearing Any person aggrieved by any action of the Commissioner or his or her authorized agent under this chapter for which hearing is not elsewhere provided may apply in writing to the Commissioner within 10 days after the notice of such action is delivered or mailed to him or her for a hearing, setting forth the reasons why such hearing should be granted and the manner of relief sought. The Commissioner shall promptly consider each such application and may grant or deny the hearing requested. If the hearing be denied, the applicant shall be notified thereof forthwith. If it be granted, the Commissioner shall notify the applicant of the time and place fixed for such hearing. After such hearing, the Commissioner may make such order in the premises as may appear to him or her just and lawful and shall furnish a copy of such order to the applicant. The Commissioner may, at any time and by notice in writing, order a hearing on his or her own initiative and require the taxpayer or any other individual whom he or she believes to be in possession of information concerning any manufacture, importation, possession, or sale of cigarettes or tobacco products, or both, which have escaped taxation to appear before him or her or his or her duly authorized agent with any specific books of account, paper, or other documents for examination relative thereto. Amended 1959, No. 231, § 6.

32 V.S.A. § 7783 Appeals

7783. Appeals Any person aggrieved because of any action or decision of the Commissioner under the provisions of this chapter may appeal therefrom within 30 days to the Superior Court of the county in which such person resides. The appellant shall give security, approved by the Commissioner, conditioned to pay the tax levied, if it remains unpaid, with interest and costs. Amended 1973, No. 193 (Adj. Sess.), § 3, eff. April 9, 1974; 1997, No. 161 (Adj. Sess.), § 22, eff. Jan. 1, 1998; 2013, No. 73, § 11, eff. June 5, 2013.

32 V.S.A. § 7784 Counterfeiting stamps

7784. Counterfeiting stamps Any person who shall fraudulently make or utter or who shall forge or counterfeit any stamp prescribed by the Commissioner under the provisions of this chapter, or who shall cause or procure the same to be done, or who shall willfully utter, publish, pass, or render as true any false, altered, forged, or counterfeit stamp, or who shall knowingly possess any such false, altered, forged, or counterfeit stamp for the purpose of evading the tax hereby imposed shall be imprisoned for not more than five years nor less than one year. Amended 1971, No. 199 (Adj. Sess.), § 17.

32 V.S.A. § 7785 Monthly report

7785. Monthly report Each licensed wholesale dealer shall file with the Commissioner, on or before the 15th day of each month, a report for the calendar month immediately preceding, in a form prescribed by the Commissioner, showing the amount and source of cigarettes acquired; the amount of stamps purchased; a list identifying the brand families of a tobacco product manufacturer, as that term is defined in 33 V.S.A. chapter 19, subchapters 1A and 1B; the total number of cigarettes upon which stamps were affixed or, in the case of roll-your-own tobacco, the equivalent stick count, as determined by the formula set forth in 33 V.S.A. chapter 19, subchapter 1A, upon which the applicable tax was paid; and such other information as the Commissioner may require. Added 1981, No. 31, § 16; amended 2003, No. 14, § 5; 2013, No. 14, § 18.

32 V.S.A. § 7786 Gray marketed cigarettes

7786. Gray marketed cigarettes (a) No person shall affix a cigarette stamp to or sell or offer for sale in this State any package or container of cigarettes if: (1) the container or package does not comply with all the requirements of the federal Cigarette Labeling and Advertising Act (15 U.S.C. § 1331 et seq.) for the placement of labels, warnings, or any other information upon a package of cigarettes that is to be sold within the United States; (2) the container or package has been imported into the United States after January 1, 2000, in violation of 26 U.S.C. § 5754; (3) the container or package, including a container of individually stamped containers or packages is labeled “For Export Only,” “U.S. Tax Exempt,” “For Use Outside U.S.,” or similar wording indicating that the manufacturer did not intend that the product be sold in the United States; or (4) the container or package has been altered by marking or deleting the wording described in subdivision (3) of this subsection. (b) Any cigarettes described in subdivision (a)(1), (2), (3), or (4) of this section and found in this State are declared to be contraband goods and may be seized without a warrant by the Commissioner, the Commissioner’s agents or employees, or by any peace officer of this State when directed by the Commissioner to do so, unless the owner of the cigarettes produces sufficient evidence that the cigarettes are in transit through the State for sale outside the United States. Nothing herein shall be construed to require the Commissioner to confiscate cigarettes when the Commissioner shall have reason to believe that the owner thereof has possession of the same for personal consumption. Any cigarettes seized under this section shall be destroyed by the Commissioner. The seizure of any cigarettes under the provisions of this section shall not relieve any person from a fine or other penalty for violation of this chapter. (c) A violation of any provision of this section shall also constitute an unfair or deceptive act and practice in commerce prohibited under 9 V.S.A. § 2453 and shall be subject to enforcement and to the rights and remedies provided for under 9 V.S.A. chapter 63. (d) Any person may bring an action for appropriate injunctive or other equitable relief for a violation of this section; actual damages, if any, sustained by reason of the violation; and, as determined by the court, interest on the damages from the date of the complaint, taxable costs, and reasonable attorney’s fees. If the trier of fact finds that the violation is flagrant, it may increase recovery to any amount not in excess of three times the actual damages sustained by reason of the violation. Added 1999, No. 101 (Adj. Sess.), § 2.

Source: Vermont General Assembly (legislature.vermont.gov)URL: https://legislature.vermont.gov/statutes/chapter/32/205Fetched: 10/21/2026