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S.B. 7 Enrolled
This act modifies provisions related to the Tax Code. The act amends confidentiality
restrictions. The act prohibits a person licensed to sell cigarettes in the state from selling
cigarettes of a tobacco product manufacturer who is not in compliance with escrow
requirements. The act changes tobacco escrow reporting requirements from an annual to
quarterly reports and imposes penalties for failure to file reports. The act amends the
definition of contraband cigarette. The act makes technical amendments.
This act affects sections of Utah Code Annotated 1953 as follows:
59-1-403, as last amended by Chapters 262, 270 and 314, Laws of Utah 2001
59-14-210, as enacted by Chapter 190, Laws of Utah 2000
59-14-213, as enacted by Chapter 190, Laws of Utah 2000
59-14-407, as last amended by Chapter 229, Laws of Utah 2000
59-14-207, as amended by Statewide Initiative B, Nov. 7, 2000, Laws of Utah 2000
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 59-1-403 is amended to read:
59-1-403. Confidentiality -- Exceptions -- Penalty -- Application to property tax.
(1) (a) Except as provided in this section, any of the following may not divulge or make
known in any manner any information gained by that person from any return filed with the
(i) a tax commissioner;
(ii) an agent, clerk, or other officer or employee of the commission; or
(iii) a representative, agent, clerk, or other officer or employee of any county, city, or town.
(b) Except as provided in Subsection (1)(c), an official charged with the custody of a return
filed with the commission is not required to produce the return or evidence of anything contained
in the return in any action or proceeding in any court, except:
(i) in accordance with judicial order;
(ii) on behalf of the commission in any action or proceeding under:
(A) this title; or
(B) other law under which persons are required to file returns with the commission;
(iii) on behalf of the commission in any action or proceeding to which the commission is a
(iv) on behalf of any party to any action or proceeding under this title if the report or facts
shown by the return are directly involved in the action or proceeding.
(c) Notwithstanding Subsection (1)(b), a court may require the production of, and may admit
in evidence, any portion of a return or of the facts shown by the return, as are specifically pertinent
to the action or proceeding.
(2) This section does not prohibit:
(a) a person or that person's duly authorized representative from receiving a copy of any
return or report filed in connection with that person's own tax;
(b) the publication of statistics as long as the statistics are classified to prevent the
identification of particular reports or returns; and
(c) the inspection by the attorney general or other legal representative of the state of the
report or return of any taxpayer:
(i) who brings action to set aside or review a tax based on the report or return;
(ii) against whom an action or proceeding is contemplated or has been instituted under this
(iii) against whom the state has an unsatisfied money judgment.
(3) (a) Notwithstanding Subsection (1) and for purposes of administration, the commission
may by rule, made in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act,
provide for a reciprocal exchange of information with:
(i) the United States Internal Revenue Service; or
(ii) the revenue service of any other state.
(b) Notwithstanding Subsection (1) and for all taxes except individual income tax and
corporate franchise tax, the commission may by rule, made in accordance with Title 63, Chapter 46a,
Utah Administrative Rulemaking Act, share information gathered from returns and other written
statements with the federal government, any other state, any of the political subdivisions of another
state, or any political subdivision of this state, except as limited by Sections 59-12-209 and
59-12-210 , if these political subdivisions or the federal government grant substantially similar
privileges to this state.
(c) Notwithstanding Subsection (1) and for all taxes except individual income tax and
corporate franchise tax, the commission may by rule, in accordance with Title 63, Chapter 46a, Utah
Administrative Rulemaking Act, provide for the issuance of information concerning the identity and
other information of taxpayers who have failed to file tax returns or to pay any tax due.
(d) Notwithstanding Subsection (1), the commission shall provide to the Solid and
Hazardous Waste Control Board executive secretary, as defined in Section 19-6-102 , as requested
by the executive secretary, any records, returns, or other information filed with the commission under
Chapter 13, Motor and Special Fuel Tax Act, or Section 19-6-410.5 regarding the environmental
assurance program participation fee.
(e) Notwithstanding Subsection (1), at the request of any person the commission shall
provide that person sales and purchase volume data reported to the commission on a report, return,
or other information filed with the commission under:
(i) Chapter 13, Part 2, Motor Fuel; or
(ii) Chapter 13, Part 4, Aviation Fuel.
(f) Notwithstanding Subsection (1), upon request from a tobacco product manufacturer, as
defined in Section 59-22-202 , the commission shall report to the manufacturer:
(i) the quantity of cigarettes, as defined in Section 59-22-202 , produced by the manufacturer
and reported to the commission for the previous calendar year under Section 59-14-407 ; and
(ii) the quantity of cigarettes, as defined in Section 59-22-202 , produced by the manufacturer
for which a tax refund was granted during the previous calendar year under Section 59-14-401 and
reported to the commission under Subsection 59-14-401 (1)(a)(v).
(g) Notwithstanding Subsection (1), the commission shall notify manufacturers, distributors,
wholesalers, and retail dealers of a tobacco product manufacturer that is prohibited from selling
cigarettes to consumers within the state under Subsection 59-14-210 (2).
(i) provide to the Division of Consumer Protection within the Department of Commerce and
the attorney general data:
(A) reported to the commission under Section 59-14-212 ; or
(B) related to a violation under Section 59-14-211 ; and
(ii) upon request provide to any person data reported to the commission under Subsections
59-14-212 (1)(a) through (1)(c) and Subsection 59-14-212 (1)(g).
of the Legislature, Office of the Legislative Fiscal Analyst, or Governor's Office of Planning and
Budget, provide to the committee or office the total amount of revenues collected by the commission
under Chapter 24, Radioactive Waste Tax Act, for the time period specified by the committee or
Legislature provide to the Legislature the total amount of sales or uses exempt under Subsection
59-12-104 (52) reported to the commission in accordance with Section 59-12-105 .
(4) (a) Reports and returns shall be preserved for at least three years.
(b) After the three-year period provided in Subsection (4)(a) the commission may destroy
a report or return.
(5) (a) Any person who violates this section is guilty of a class A misdemeanor.
(b) If the person described in Subsection (5)(a) is an officer or employee of the state, the
person shall be dismissed from office and be disqualified from holding public office in this state for
a period of five years thereafter.
(6) This part does not apply to the property tax.
Section 2. Section 59-14-210 is amended to read:
59-14-210. Prohibited sales of cigarettes.
(1) Except as provided in Subsection [
may not barter, sell, exchange, or offer for sale cigarettes:
(a) in a package which:
(i) bears a statement, label, stamp, sticker, or other notice that the manufacturer did not
intend the cigarettes to be sold, distributed, or used in the United States, including the following and
(A) "For Export Only";
(B) "U.S. Tax-Exempt"; and
(C) "For Use Outside the U.S."; or
(ii) does not comply with federal law, including 15 U.S.C. 1333 of the Federal Cigarette
Labeling and Advertising Act, regarding warning labels and other package information;
(b) imported to the United States in violation of 26 U.S.C. 5754;
(c) the licensee knows or has reason to know were not manufactured for sale, distribution,
or use in the United States;
(d) for which a list of added ingredients has not been submitted to the federal Department
of Health and Human Services pursuant to 15 U.S.C. 1335a of the Federal Cigarette Labeling and
Advertising Act; or
(e) known by the licensee to be otherwise in violation of other related federal law.
(2) A person licensed under Section 59-14-202 may not barter, sell, exchange, or offer for
sale cigarettes of a tobacco product manufacturer that is prohibited from selling cigarettes to
consumers within the state under Subsection 59-22-203 (3)(c).
merchandise by a duty-free sales enterprise in accordance with the provisions of 19 U.S.C. 1555(b)
and any implementing regulations unless the cigarettes are brought back into the customs territory
for resale within the customs territory.
Section 3. Section 59-14-213 is amended to read:
59-14-213. Contraband goods.
(1) Any cigarettes in violation of [
59-14-203 , 59-14-205 , 59-14-211 or [
contraband goods and may be seized without a warrant by the commission, its employees, or any
peace officer of the state or its political subdivisions.
(2) Any [
commission and destroyed.
Section 4. Section 59-14-407 is amended to read:
59-14-407. Reporting of manufacturer name.
(1) As used in this section:
(a) "Cigarette" has the same meaning as defined in Section 59-22-202 .
(b) "Tobacco product manufacturer" has the same meaning as defined in Section 59-22-202 .
(2) Any manufacturer, distributor, wholesaler, or retail dealer who under Section 59-14-205
affixes a stamp to an individual package or container of cigarettes manufactured by a tobacco
product manufacturer required to place funds into escrow under Section 59-22-203 shall report
(a) the quantity of cigarettes in the package or container; and
(b) the name of the manufacturer of the cigarettes.
(3) Any manufacturer, distributor, wholesaler, retail dealer, or other person who is required
to pay the tax levied under Part 3, Tobacco Products, on a tobacco product defined as a cigarette
under Section 59-22-202 and manufactured by a tobacco product manufacturer required to place
funds into escrow under Section 59-22-203 shall report [
(a) the quantity of cigarettes upon which the tax is levied; and
(b) the name of the manufacturer of each cigarette.
(4) (a) The reports under Subsections (2) and (3) shall be made no later than [
quarterly period pursuant to rules established by the commission in accordance with Title 63,
Chapter 46a, Utah Administrative Rulemaking Act.
(b) A person required to file a report under this section is subject to the penalties under
Section 59-1-401 for failing to file a report in a timely manner, or for supplying false or fraudulent
Section 5. Repealer.
This act repeals:
Section 59-14-207, Unstamped cigarettes -- Contraband goods -- Seizure.
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