
Alerts & Updates
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27 States + DC Enact Laws Related to Raising Smoking Age to 21
Following the Federal Age of Tobacco Purchase increase from 18 to 21 that occurred in December of last year, 27 […]
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State of the States Update
In 2019, your state government relations team tracked 900 state bills! This year, we are expecting even more tobacco bill […]
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Illinois Supreme Court Strikes Down Tobacco Tax
Today, the Illinois Supreme Court issued a ruling striking down a Chicago, Illinois ordinance that imposed local excise taxes on […]
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Key Contacts
Illinois Department of Revenue
Alcohol, Tobacco, and Fuel Division
(217) 782-6045
PCA Contact
Joshua Habursky
Glynn Loope joshua@premiumcigars.orgglynn@premiumcigars.org
Legislative Information
Taxation
Illinois’s Tobacco Products Tax Act of 1995 imposes a tax on tobacco products purchased for sale in the state by any person engaged in the business of a tobacco products distributor. Out-of-state distributors must pay this tax if they sell tobacco products to Illinois retailers or consumers. However, purchases of tobacco products by wholesalers who will not sell the product at retail or who will deliver the products outside of Illinois are exempt from the tax.
The state tobacco products tax is in addition to all other occupation or privilege taxes imposed by any political subdivision of Illinois or by any municipal corporation.
The tobacco products tax is 36% of the wholesale price of tobacco products sold or otherwise disposed of to retailers or consumers located in the state, except that the tax on moist snuff is $0.30 per ounce and the tax on little cigars is the same rate as the tax imposed on cigarettes and must be paid by purchasing tax stamps.
Beginning on July 1, 2019, “tobacco products” also includes electronic cigarettes. The tax on electronic cigarettes shall be imposed at the rate of 15% of the wholesale price of electronic cigarettes sold or otherwise disposed of to retailers or consumers located in this State.
Illinois SB 690 (2019) imposes a tax upon any person engaged in business as a retailer of cigarettes at the rate of 149 mills per cigarette sold or otherwise disposed of in the course of such business (rather than the aggregate tax rate of 99 mills), which shall be distributed each month into the Capital Projects Fund.
Every distributor must file a Tobacco Products Tax Return (Form TP-1) with the Department of Revenue on or before the 15th day of each month, along with payment for the taxes due.
Form Type / Name | Form Number / Link |
Tobacco Products Tax Forms Database | Tax Forms Database |
Tobacco Products Tax Return: Form TP-1 | Form TP-1 |
Form TP-1 – Instructions | Instructions |
Cigar and Smoking Tobacco Definitions
Restrictions
Illinois state law prohibits smoking in public places, places of employment, and government vehicles. This prohibition includes, but is not limited to, hospitals, restaurants, retail stores, offices, commercial establishments, elevators, indoor theaters, libraries, museums, concert halls, public conveyances, educational facilities, nursing homes, auditoriums, enclosed or partially enclosed sports arenas, meeting rooms, schools, exhibition halls, convention facilities, polling places, private clubs, gaming facilities, all government-owned vehicles and facilities, healthcare facilities or clinics, enclosed shopping centers, retail service establishments, financial institutions, educational facilities, ticket areas, public hearing facilities, public restrooms, waiting areas, lobbies, bars, taverns, bowling alleys, skating rinks, reception areas, and no less than 75% of the sleeping quarters within a hotel, motel, resort, inn, lodge, or bed and breakfast. Additionally, the state enacted the Smoke-Free Campus Act. Smoking is prohibited on each campus of a State-supported institution of higher education.
410 Ill. Comp. Stat. 82/10: Definitions
410 Ill. Comp. Stat. 82/15: Smoking in public places, places of employment, and governmental vehicles prohibited
770 Ill. Comp. Stat. 64/15: Smoke –Free Campus Act
Any home rule unit of local government, any non-home rule municipality, or any non-home rule county within the unincorporated territory of the county may regulate smoking in public places, but that regulation must be no less restrictive than state law. In addition, any home rule unit of local government, any non-home rule municipality, or any non-home rule county within the unincorporated territory of the county may regulate smoking in any enclosed indoor area used by the public or serving as a place of work if the area does not fall within the definition of a “public place” under state law.
Illinois HB 2276 (2019) states that a person shall not smoke in a motor vehicle containing a person under 18 years of age, regardless of whether the vehicle is in motion, at rest, or has its windows down. This measure defines smoking as inhaling, exhaling, burning, or carrying a lighted cigarette, cigar, pipe, weed, plant, regulated narcotic, or other combustible substance. A police officer may not stop a motor vehicle solely for this violation. Furthermore, this measure states that a violation is a petty offense with a maximum fine of $100 and that, for a second or subsequent offense, the fine is not to exceed $250.
The following are exempt from the ban on smoking, subject to conditions:
- Private residences, except when used as a childcare, adult daycare, or healthcare facility or any other home-based business open to the public.
- Retail tobacco stores in operation prior to January 1, 2008, that derive more than 80 percent of their gross revenue from the sale of loose tobacco, plants, or herbs and cigars, cigarettes, pipes, and other smoking devices for burning tobacco and related smoking accessories. Retail tobacco stores that began operation after January 1, 2008 only qualify for an exemption if located in a freestanding structure occupied solely by the business and if smoke from the business does not migrate into an enclosed area where smoking is prohibited. Retail tobacco stores must file an annual affidavit to the Illinois Department of Public Health by January 31st stating the percentage of its gross income that was derived from the sale of tobacco products.
- Staff reported that there is no required form for this affidavit. A simple letter is sufficient as long as it lists the business name and includes the required information.
- Affidavits may be sent to:
- Tobacco Control Program
535 West Jefferson Street (2nd Floor)
Springfield, Illinois 62761
- Tobacco Control Program
- Designated hotel and motel rooms.
- Enclosed laboratories.
- Common smoking rooms in long-term care facilities.
- Vehicles traveling through or parked on campus as long as the vehicles are not owned by a state-supported institution of higher education.
770 Ill. Comp. Stat. 64/15: Smoke–Free Campus Act
Beginning July 1, 2019, the minimum age to purchase tobacco products and cigarettes within Illinois was raised from 18 to 21.
Individuals under 16 years of age cannot sell any tobacco product at a retail establishment selling tobacco products. This prohibition does not apply to a salesclerk in a family-owned business that can prove the salesclerk is, in fact, a son or daughter of the owner.
720 Ill. Comp. Stat. 675/1 Prevention of Tobacco Use by Persons under 21 Years of Age and Sale and Distribution of Tobacco Products Act
State liquor laws do not regulate age restrictions for admittance to liquor establishments. It is the decision of local municipalities to regulate this restriction.
In Illinois, distributing free samples of any tobacco product to any person, regardless of age, is illegal:
- Within a retail establishment selling tobacco products, unless the retailer has verified the purchaser’s age with a government-issued ID
- From a lunch wagon/food truck; or
- In a public way as a promotion or advertisement of a tobacco manufacturer or tobacco product.
This prohibition does not apply to the distribution of a tobacco product sample in any adult-only facility where the operator ensures or has a reasonable basis to believe that no person under the legal age is present.
The sale or distribution of a tobacco product that is not contained within a sealed container, pack, or package bearing a federal health warning as provided by the manufacturer is prohibited.
720 Ill. Comp. Stat. 675/1 (a-8)
Staff reported that tobacco samples are taxed at the same rate as other tobacco products in Illinois.
Localities may require licenses for the distribution of tobacco product samples.
Illinois law contains no specific provisions concerning state preemption of sampling, so local communities may pass more stringent laws or ordinances on tobacco sampling.
Operating Your Business
Anyone who is engaged in the business of a tobacco products distributor in Illinois must obtain a license from the Department of Revenue by filing an Illinois Business Registration Application (Form REG-1) and a Cigarette and Tobacco Products Information form (Form REG-1-C). There is no application fee, but distributors must file a bond equal to three times the company’s average monthly tobacco tax liability or $50,000, whichever is less. Beginning on January 1, 2016, all retailers of tobacco products in Illinois must obtain an annual license from the Department of Revenue for $75 per place of business. A single license will be issued by the Department if a person is both licensed as a distributor and retailer under the Tobacco Products Act (including a retailer who is deemed to be sufficiently licensed by virtue of his being properly licensed as a retailer under Section 4g of the Cigarette Tax Act).
Every distributor must also file a Tobacco Products Tax Return (Form TP-1) with the Department of Revenue on or before the 15th day of each month, along with payment for the taxes due.
Illinois SB 664 (2019) provides that any person who manufactures, fabricates, assembles, processes, or labels a tobacco product or imports a finished tobacco product for sale or distribution in the United States, shall provide written evidence and documentation of its compliance with labeling provisions of the federal Family Smoking Prevention and Tobacco Control Act of 2009. These compliance records would need to be reported to the Department of Public Health and the Department of Revenue.
Localities may require additional business licenses.
Form Type / Name | Form Number / Link |
Illinois Department of Revenue: Business Registration Forms | Business Registration Forms |
Illinois Business Registration Application | Form REG-1 |
Cigarette and Tobacco Products Information | Form REG-1-C |
Tobacco Products Tax Forms Database | Tobacco Tax Forms Database |
Tobacco Products Tax Return | Form TP-1 |
Tobacco Products Tax Return – Instructions | Instructions |
Political Involvement
Illinois law requires any individual who, for compensation or otherwise, undertakes to lobby or any person or entity who employs or compensates another person for lobbying, to register annually, on or before January 31st, with the Secretary of State electronically. The registration fee is $300. All lobbying entities must also submit bi-monthly expenditure reports.
Form Type / Name | Form Number / Link |
Illinois Lobbyist Registration Act | 25 ILCS 170/ |
Illinois Lobbyist Registration and Reporting System | Registration and Reporting System |
Lobbyists Registration: Annual Registration Guide | Annual Registration Guide |
Illinois Lobbyists: Electronic Expenditure Filing Instructions | Electronic Expenditure Filing Instructions |
Shipping Regulations
Illinois’s Tobacco Products Tax Act of 1995 includes a requirement addressing shipping invoices. If required by the Department of Revenue, every distributor who purchases tobacco products for shipment into Illinois from a point outside Illinois shall procure invoices in duplicate covering each shipment and provide one copy of each invoice to the Department at the time of filing the return required by this Act. In addition, under the Prevention of Cigarette Sales to Minors Act, Illinois has specific age verification requirements for the shipping of cigarettes.
Illinois does not have any specific age verification requirements for the shipping of tobacco products.
Illinois’s Tobacco Products Tax Act of 1995 imposes a tax on tobacco products purchased for sale in the state by any person engaged in the business of a tobacco products distributor. Out-of-state distributors must pay this tax if they sell tobacco products to Illinois retailers or consumers. However, purchases of tobacco products by wholesalers who will not sell the product at retail or who will deliver the products outside of Illinois are exempt from the tax.
The state tobacco products tax is in addition to all other occupation or privilege taxes imposed by any political subdivision of Illinois or by any municipal corporation.
Additional information about taxation in Illinois, including information about tax rates, filings, and forms, is available at the Taxation and Definitions link above.
Disclaimer: PCA believes the information on this site is accurate. However, tobacco laws and regulations are subject to frequent change and court interpretation. Statements above are not intended as legal advice or restatement of law. PCA does not guarantee or assume responsibility for the accuracy, completeness or timeliness of this information, nor that this information complies with all federal laws or the laws of all 50 states. Parties acknowledge and agree it is not the intention of PCA to provide specific legal advice for particular individuals, but rather to provide users with general information to better understand these issues. Users shall neither construe any of these materials as legal advice nor make this site the primary basis for any legal decisions made by or on your behalf and agree to release and waive any claims against PCA for the same. You shall consult with legal advisors concerning any contemplated individual decision.