N.J. Admin. Code § 18:5-2.5

Current through Register Vol. 56, No. 17, September 3, 2024

Section 18:5-2.5 - Cigarettes ceasing to be subject to tax

(a) Unstamped cigarettes possessed subject to tax may cease to be subject to such tax provided the cigarettes are:

1. Sold to the United States Government or agencies thereof.

i. Sales of unstamped cigarettes may be made by licensed distributors only to such agencies as are duly authorized by the Director to receive the same.

(1) Unstamped cigarettes sold to authorized agencies must be physically delivered by the distributors' conveyance or by an authorized common carrier directly to the situs where the installation of the governmental agency is located;

(2) A duly receipted invoice or a copy thereof must be obtained from the governmental agent designated to accept delivery, which duly receipted invoice must be appended to Schedule D (Form CR-5), Sales of Unstamped Cigarettes to United States Government, of the distributor's monthly report upon which every sale must be reported in complete detail;

2. Sold to out-of-State jobbers or dealers. Such sales of unstamped cigarettes may be made by licensed distributors within the State of New Jersey only to such out-of-State persons who can properly identify themselves as registered or licensed cigarette jobbers or dealers in the state into which the cigarettes are to be transported.

i. The true identity of the purchaser of the unstamped cigarettes must be ascertained by the licensed distributor before the sale is consummated;

ii. The out-of-State jobber or dealer must make a declaration of the ultimate destination of the unstamped cigarettes, and a duly receipted invoice or a copy thereof must be obtained by the licensed distributor from the out-of-State jobber or dealer, which invoice must also indicate the ultimate destination of the cigarettes;

iii. All cigarettes so sold must be reported on the licensed distributor's monthly report in the complete detail required by Schedule C (Form CR- 4), Sales, Deliveries, and Transfers of Cigarettes from New Jersey;

iv. Under no circumstances may a licensed distributor sell unstamped cigarettes at his or her place of business in New Jersey to a purchaser who is identified as a jobber or dealer in a state that does not have a cigarette tax and who declares the immediate destination of the cigarettes to be to a state not having a cigarette tax;

3. Exported to points outside of New Jersey by common carrier. Duly licensed distributors may ship unstamped cigarettes by common carrier to themselves or to customers outside of New Jersey, provided there is obtained from the carrier a manifestation or other memorandum indicating that the cigarettes were consigned to the distributor's place of business or a customer, outside of New Jersey.

i. Such manifests, invoices, bills of lading, or other evidence covering such shipments must be properly completed and preserved for examination and audit;

ii. All such shipments must be listed by the distributor on its monthly tax report on Schedule C (Form CR-4), Sales, Deliveries, and Transfers of Cigarettes from New Jersey;

4. Exported to points outside of New Jersey not by common carrier. Duly licensed distributors may ship unstamped cigarettes by personally controlled conveyance, or transportation other than a common carrier, to themselves or to customers outside of New Jersey, provided prior notice of such shipments is received, in writing, by the Director.

i. Invoices, bills of lading, or other evidence covering such shipments must be properly completed and preserved for examination and audit.

ii. All such shipments must be listed by the distributor on its monthly tax report on Schedule C (Form CR-4), Sales, Deliveries, and Transfers of Cigarettes from New Jersey; and

5. Distributed to hospitalized veterans in State hospitals. Such distribution of unstamped cigarettes may be made by approved representatives of the United States Veterans Administration to veterans hospitalized in any hospital owned and operated by the State of New Jersey, when such cigarettes are acquired directly through donations from the manufacturer, or others bonded to handle unstamped cigarettes through donations made therefor.

i. All such acquisitions must be reported by the approved representative of the United States Veterans Administration on or before the 20th day of the month following receipt of such cigarettes.

ii. In addition, there must be maintained a record of distribution and a file of all purchase invoices and bills of lading covering all purchases of unstamped cigarettes.

(b) All of the records required by this section must be preserved for a period of four years, unless authorization to destroy them in a lesser period is received from the Director.

N.J. Admin. Code § 18:5-2.5

Amended by 49 N.J.R. 1912(b), effective 7/3/2017