Salinas Municipal Code Art. II Cigarette Tax

* Editor's note.—The provisions of section 1 of Ordinance No. 1334 (NCS) provide as follows: "In order to comply with the requirements of those provisions of Chapter 963 of the Statutes of 1967 (Rev. & Tax. C., § 30462) which provide that State cigarette tax revenues may not be allocated to any city imposing a selective local tax on, or with respect to, the sale, distribution, use, consumption or holding of cigarettes or any other tobacco product, after October 1, 1967, the provisions of Ordinance No. 1299 (N.C.S.) relating to the imposition, collection and enforcement of a cigarette tax shall be suspended on and after October 1, 1967, and shall remain suspended and thereafter be of no force and effect so long as the provisions of the Revenue and Taxation Code of the State of California, as modified by said Chapter 963 and pursuant to which the city is entitled to receive the allocation specified therein of the State cigarette tax revenues, are effective; provided, however, that in the event said Revenue and Taxation Code shall be further amended so that the city is not entitled to receive the allocation of the State cigarette tax revenues specified in said Chapter 963, then the said provisions of Ordinance No. 1299 (N.C.S.) shall upon the effective date of such amendment become operative and effective; and further provided that in the event the provisions of said Revenue and Taxation Code, as added by said Chapter 963 and pursuant to which the city is entitled to receive the allocation specified therein of the State cigarette tax revenues, are for any reason declared invalid, then and in that event the said provisions of Ordinance No. 1299 (N.C.S.) shall not be deemed to have been suspended but shall be deemed to have been in full force and effect continuously from and after October 1, 1967. Nothing in this ordinance shall be construed as relieving any person of the obligation to pay the City of Salinas any cigarette tax accrued and owing by reason of said provisions of Ordinance No. 1299 (N.C.S.) in force and effect prior to and including September 30, 1967."

For the purposes of this article, the following words and phrases shall have the meanings respectively ascribed to them by this section:

Cigarette. Any roll for smoking, made wholly or in part of tobacco, irrespective of size or shape and irrespective of whether the tobacco is flavored, adulterated or mixed with any other ingredient, where such roll has a wrapper or cover made of paper or any other material, except where such wrapper is wholly or in the greater part made of tobacco and such roll weighs over three pounds per thousand.

Retailer. Every person who sells cigarettes for any purpose other than resale. Where cigarettes are offered for sale through the means of a vending machine, the person holding title to the cigarettes in the machine shall be deemed the retailer.

Use or consumption. The exercise of any right or power over cigarettes incident to the ownership other than the sale of the cigarettes or the keeping or retention thereof for the purpose of sale.

(Ord. No. 1299 (NCS), § 2.)

An excise tax is hereby imposed upon the use or consumption in the city of cigarettes purchased from a retailer for use or consumption within the city at the rate of one mill per cigarette.

(Ord. No. 1299 (NCS), § 3.)

The tax constitutes a debt owed by the purchaser to the city which is extinguished only by payment of the tax to the finance director or to the retailer. When a purchase from a retailer is made within the city, the tax shall be paid to the retailer at the time the purchase price is paid. The tax collected or required to be collected by the retailer constitutes a debt owed by the retailer to the city. Should any remittance of tax be made by a retailer prior to sale of cigarettes to a consumer, such remittance shall be considered as an advance payment to be reimbursed by adding the amount of the tax to the price of the cigarettes at the time of sale to the user or consumer.

(Ord. No. 1299 (NCS), § 4.)

Each retailer selling cigarettes within the city shall collect the tax imposed under Section 32-3 and on or before the last day of the month following the close of a calendar quarter remit the total amount so collected to the finance director together with a statement on a form provided by the finance director showing the number of cigarettes sold to purchasers, the amount of tax collected, and such other information as the finance director shall require. Where the finance director determines that efficiency in the administration of the tax would be promoted, he may establish reporting periods greater than quarterly, but not to exceed one year. The finance director may establish shorter reporting periods for any retailer if he deems it necessary in order to insure collection of the tax. Statements and payments are due immediately upon cessation of the business of selling cigarettes for any reason. All taxes collected by retailers pursuant to this article shall be held in trust for the account of the city until payment thereof is made to the finance director.

(Ord. No. 1299 (NCS), § 5.)

(a) Each retailer shall register with the finance director and obtain from him a "cigarette tax registration certificate" to be at all times posted in a conspicuous place on the premises; provided, however, each retailer who does not operate from a fixed place of business shall keep the registration certificate upon his person at all times while engaging in the business of being a retailer. No person shall engage in the business of being a retailer without obtaining a registration certificate therefor. Such certificate shall, among other things, state the following:

(1) The name of the retailer.

(2) The address of the retailer's place of business.

(3) The date upon which the certificate was issued.

(4) "This Cigarette Tax Registration Certificate signifies that the person named on the face hereof has fulfilled the requirements of the Cigarette Tax Ordinance by registering with the Finance Director for the purpose of collecting the Cigarette Tax from purchasers of cigarettes and remitting said tax to the Finance Director. This certificate does not authorize any person to conduct any lawful business in an unlawful manner, nor to operate a cigarette retailing business without complying with all state and local applicable laws, including but not limited to those requiring a permit from any board, commission, department or office of this city. This certificate does not constitute a permit."

(b) All cigarette tax registration certificates shall be countersigned by the finance director.

(c) A retailer having within the city more than one place of business at which cigarettes are sold shall be required to obtain a separate registration for each such place of business.

(Ord. No. 1299 (NCS), § 6.)

(a) Taxes collected by a retailer, which are not remitted to the finance director on or before the due dates fixed in Section 32-5 or fixed by the finance director as provided herein, are delinquent.

(b) Any retailer who fails to remit any tax imposed by this article within the time required shall pay a penalty of ten percent of the amount of the tax in addition to the amount of the tax.

(c) Any retailer who fails to remit the said tax on or before the thirtieth day following the date on which the tax first became delinquent shall pay a second delinquency penalty of ten percent of the amount of the tax in addition to the amount of the tax and the ten percent penalty first imposed.

(d) If the finance director determines that the nonpayment of any tax due under this article is due to fraud, a penalty of twenty-five percent of the amount of the tax shall be added thereto in addition to the penalties stated in subparagraphs (b) and (c) of this section.

(e) In addition to the penalties imposed, any retailer who fails to remit any tax imposed by this ordinance shall pay interest at the rate of one half of one percent per month, or fraction thereof, on the amount of the tax, exclusive of penalties, from the date on which the tax first became delinquent until paid.

(f) Every penalty imposed and such interest as accrues under the provisions of this section shall become a part of the tax herein required to be paid.

(Ord. No. 1299 (NCS), § 7.)

If any retailer shall fail or refuse to collect the tax and to make, within the time provided in this article, any report and remittance of the tax or any portion thereof required by this article, the finance director shall proceed in such manner as he may deem best to obtain facts and information on which to base his estimate of the tax due. As soon as the finance director shall procure such facts and information as he is able to obtain upon which to base the assessment of any tax imposed by this article and payable by any retailer who has failed or refused to collect the same and to make such report and remittance, he shall proceed to determine and assess against such retailer the tax, interest and penalties provided for by this article. In case such determination is made, the finance director shall give a notice of the amount so assessed by serving it personally or by depositing it in the United States mail, postage prepaid, addressed to the retailer so assessed at his last known place of address. Such retailer may within ten days after the serving or mailing of such notice make application in writing to the finance director for a hearing on the amount assessed. If application by the retailer for a hearing is not made within the time prescribed, the tax, interest and penalties, if any, determined by the finance director shall become final and conclusive and immediately due and payable. If such application is made, the finance director shall give not less than five days' written notice in the manner prescribed herein to the retailer to show cause at a time and place fixed in said notice why such amount specified therein should not be fixed for such tax, interest and penalties. At such hearing, the retailer may appear and offer evidence why such specified tax, interest and penalties should not be so fixed. After such hearing, the finance director shall determine the proper tax to be remitted and shall thereafter give written notice to the retailer in the manner prescribed herein of such determination and the amount of such tax, interest and penalties. The amount determined to be due shall be payable after fifteen days unless an appeal is taken as provided in Section 32-9.

(Ord. No. 1299 (NCS), § 8.)

Any retailer aggrieved after such hearing by any decision of the finance director with respect to the amount of such tax, interest and penalties, if any, may appeal to the city council by filing a notice of appeal with the city clerk within fifteen days of the serving or mailing of the determination of tax due. The council shall fix a time and place for hearing such appeal, and the city clerk shall give notice in writing to such retailer at his last known place of address. The findings of the council shall be final and conclusive and shall be served upon the appellant in the manner prescribed above for service of notice of hearing. Any amount found to be due shall be immediately due and payable upon the service of notice.

(Ord. No. 1299 (NCS), § 9.)

It shall be the duty of every retailer liable for the collection and payment to the city of any tax imposed by this article to keep and preserve for a period of three years, all records as may be necessary to determine the amount of such tax as he may have been liable for the collection of and payment to the city, which records the finance director shall have the right to inspect at all reasonable times.

(Ord. No. 1299 (NCS), § 10.)

(a) Whenever the amount of any tax, interest or penalty has been overpaid or paid more than once or has been erroneously or illegally collected or received by the city under this article, it may be refunded as provided in subsections (b) and (c) of this section provided a claim in writing therefor, stating under penalty of perjury the specific ground upon which the claim is founded, is filed with the finance director within three years of the date of payment. The claim shall be on forms furnished by the finance director.

(b) A retailer may claim a refund or take as credit against taxes collected and remitted the amount overpaid, paid more than once or erroneously or illegally collected or received, when it is established in a manner prescribed by the finance director that the person from whom the tax has been collected was not a user or consumer as that term is defined in subsection (b) of Section 32-2; provided, however, that neither a refund nor a credit shall be allowed unless the amount of the tax so collected has either been refunded to the purchaser erroneously required to pay the tax or otherwise credited to him.

(c) No refund shall be paid under the provisions of this section unless the claimant establishes his right thereto by written records showing entitlement thereto.

(Ord. No. 1299 (NCS), § 11.)

Any person using or consuming cigarettes within the city who has not paid the tax required by the provisions of this article, and any retailer who has failed to collect or who has collected but not remitted any tax required to be paid by the provisions of this article, shall be liable to an action brought in the name of the city for the recovery of such amount.

(Ord. No. 1299 (NCS), § 12.)

(a) Any person violating any of the provisions of this article shall be guilty of a misdemeanor and shall be punishable as provided in section 1-7.

(b) Any retailer or other person who fails or refuses to register as required herein Or to furnish any return required to be made, or who fails or refuses to furnish a supplemental return or other data required by the finance director, or who renders a false or fraudulent return or claim, is guilty of a misdemeanor, and is punishable as aforesaid. Any person required to make, render, sign or verify any report or claim who makes any false or fraudulent report or claim with intent to defeat or evade the determination of any amount due required by this article to be made, is guilty of a misdemeanor and is punishable as aforesaid.

(Ord. No. 1299 (NCS), § 13.)