PCA

Minnesota

Alerts & Updates

Key Contacts

Minnesota Department of Revenue
Cigarette and Tobacco Tax Unit
(651) 556-3035
Contact

Minnesota Campaign Finance and Public Disclosure Board
Contact

PCA Contact

Joshua Habursky
Glynn Loope joshua@premiumcigars.orgglynn@premiumcigars.org

Legislative Information

2019 Session Info
2019 Partisan Splits

Taxation

Minnesota imposes a tax on all tobacco products in the state and on any person engaged in business as a distributor. The tax is imposed at the time the distributor: brings, or causes to be brought, into this state from outside the state tobacco products for sale;makes, manufactures, or fabricates tobacco products in this state for sale in this state; orships or transports tobacco products to retailers in this state, to be sold by those retailers.The tobacco products tax may also be imposed on the use or consumption of tobacco products in the state.

Minn. Stat. §297F.05(3-4a)

Staff reported that Minnesota localities do not levy additional taxes on tobacco products.

The tax on tobacco products is 95% of the wholesale sales price, except that the tax on premium cigars is the lesser of 95% of the wholesale sales price of $3.50 per premium cigar.

Minn. Stat. §297F.05(3-4a)

The “wholesale sales price” is the price at which a distributor purchases a tobacco product. Wholesale sales price includes the applicable federal excise tax, freight charges, or packaging costs, regardless of whether they were included in the purchase price.

Minn. Stat. §297F.01(23)

Minnesota HF 5X (2019) changes the percent of the June sales tax liability paid on an accelerated basis from 81.4% to 87.5% for vendors with annual liabilities of more than $250,000 per year for the June 2020 and 2021 liabilities. The rate is reduced to 84.5% beginning with June 2022 liabilities.

Tobacco products distributors with a place of business in Minnesota must file a Tobacco Tax Monthly Return (Form CT-301), applicable schedules, and payment for taxes due on or before the 18th day of each month, even if no tax is due. Tobacco Tax Monthly Returns may be filed electronically through Minnesota e-Services. 

Minn. Stat. §297F.09: Returns; payment of tax.

Additionally, consumers of untaxed tobacco products in Minnesota must file a Tobacco Use Tax Return (Form CT303), along with payment for taxes due.

A Minnesota Tax ID Number is required before filing a tobacco tax return. Generally, this is the same as the sales and use tax or Minnesota employer’s withholding tax number.

To apply for a Minnesota tax ID number, apply online at www.revenue.state.mn.us, or call 651- 282‑5225 or 1-800-657-3605.

Form Type / NameForm Number / Link
Minnesota Department of Revenue: Tobacco Tax Forms and InstructionsTax Forms and Instructions
File Cigarette Tax ElectronicallyCigarette Tax E-Filing
File Tobacco Tax ElectronicallyTobacco Tax E-Filing

Cigar and Smoking Tobacco Definitions

“Smoking” means inhaling or exhaling smoke from any lighted cigar, cigarette, pipe, or any other lighted tobacco or plant product. Smoking also includes carrying a lighted cigar, cigarette, pipe, or any other lighted tobacco or plant product intended for inhalation.

Minn. Stat. §144.413(4)

“Tobacco products” means any product containing, made, or derived from tobacco that is intended for human consumption, whether chewed, smoked, absorbed, dissolved, inhaled, snorted, sniffed, or ingested by any other means, or any component, part, or accessory of a tobacco product, including, but not limited to, cigars; cheroots; stogies; periques; granulated, plug cut, crimp cut, ready rubbed, and other smoking tobacco; snuff; snuff flour; cavendish; plug and twist tobacco; fine-cut and other chewing tobacco; shorts; refuse scraps, clippings, cuttings and sweepings of tobacco, and other kinds and forms of tobacco.

Minn. Stat. §297F.01(19)

A “premium cigar” is any cigar that is hand-constructed and hand-rolled, has a wrapper that is made entirely from whole tobacco leaf, has a filler and binder that is made entirely of tobacco, except for adhesives or other materials used to maintain size, texture, or flavor, and has a wholesale price of no less than $2.

Minn. Stat. §297F.01(13a)

“Moist snuff” is any finely cut, ground, or powdered smokeless tobacco that is intended to be placed or dipped in the mouth.

Minn. Stat. §297F.01(10b)

A “tobacco products distributor” is any of the following:

  • a person engaged in the business of selling tobacco products in Minnesota who brings, or causes to be brought, into the state from outside the state any tobacco products for sale
  • a person who makes manufactures or fabricates tobacco products in Minnesota for sale in the state
  •  a person engaged in the business of selling tobacco products outside Minnesota who ships or transports tobacco products to retailers in the state, to be sold by those retailers

Minn. Stat. §297F.01(20)

A “retailer” is a person required to be licensed under chapter 461 engaged in this state in the business of selling, or offering to sell, cigarettes or tobacco products to consumers.

Minn. Stat. §297F.01(14)

The “wholesale sales price” is the price at which a distributor purchases a tobacco product. Wholesale sales price includes the applicable federal excise tax, freight charges, or packaging costs, regardless of whether they were included in the purchase price.

Minn. Stat. §297F.01(23)

“Sale” means a transfer, exchange, or barter, in any manner or by any means, for consideration, and includes all sales made by any person. It also includes gifts or samples provided for advertising or promotional purposes, made by a person engaged in the selling of cigarettes or tobacco products.

Minn. Stat. §297F.01(16)

Restrictions

Minnesota law prohibits smoking: in public places, including restaurants, bars, any other food or liquor establishment, retail stores and other commercial establishments, educational facilities, hospitals, nursing homes, auditoriums, arenas, meeting rooms, and common areas of rental apartment buildings; at public meetings; in places of employment, including public conveyances, factories, warehouses, offices, retail stores, restaurants, bars, banquet facilities, theaters, food stores, banks, financial institutions, employee cafeterias, lounges, auditoriums, gymnasiums, restrooms, elevators, hallways, museums, libraries, bowling establishments, employee medical facilities, and rooms or areas containing photocopying equipment or other office equipment used in common; in public transportation, including light and commuter rail transit; buses; enclosed bus and transit stops; taxis, vans, limousines, and other for-hire vehicles other than those being operated by the lessee; and ticketing, boarding, and waiting areas in public transportation terminals; in day care centers, family homes, and group family day care centers; and in hospitals, health care clinics, doctor’s offices, or other health care-related facilities.

Minn. Stat. § 144.413: Definition.

Minn. Stat. §144.414: Prohibitions.

Minn. Stat. §144.4165: Tobacco products prohibited in public schools.

The proprietor or other person, firm, limited liability company, corporation, or other entity that owns, leases, manages, operates, or otherwise controls the use of a public place, public transportation, place of employment, or public meeting shall make reasonable efforts to prevent smoking in the public place, public transportation, place of employment, or public meeting by:

  • posting appropriate signs or by any other means which may be appropriate, and
  • asking any person who smokes in an area where smoking is prohibited to refrain from smoking and, if the person does not refrain from smoking after being asked to do so, asking the person to leave. If the person refuses to leave, the proprietor, person, or entity in charge shall handle the situation consistent with lawful methods for handling other persons acting in a disorderly manner or as a trespasser.

Minn. Stat. §144.416: Responsibilities of proprietors.

Minnesota state law does not regulate outdoor smoking.

Nothing in the Clean Indoor Air Act prohibits a statutory or home rule charter city or county from enacting and enforcing more stringent measures to protect individuals from secondhand smoke.

Minn. Stat. §144.417(4): Local government ordinances.

The following are exempt from the ban on smoking, subject to conditions:

  • Patients or residents in a nursing home, boarding care facility, licensed residential facility for adults, and locked psychiatric units, provided that smoking is only allowed in separate, designated, and well-ventilated areas
  • Drivers of public transportation vehicles, when the vehicle is being used for personal use
  • Participants in peer-reviewed scientific studies related to the health effects of smoking
  • Traditional Native American spiritual or cultural ceremonies
  • Private places, including private homes, private residences, or private automobiles when they are not used as places of employment
  • Tobacco products shops, when tobacco is lit by a customer or potential customer for the specific purpose of sampling tobacco products.
    • A “tobacco products shop” is a retail establishment with an entrance door opening directly to the outside that derives more than 90% of its 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 and in which the sale of other products is merely incidental.
    • “Tobacco products shop” does not include a tobacco department or section of any individual business establishment with any type of liquor, food, or restaurant license.
    • Staff reported that the Minnesota Department of Health does not issue any type of approval to allow smoking in tobacco products shops. Staff also clarified that the smoking exemption is not intended to allow for smoking lounges or business models based on profiting from permitting smoking.
  • Cabs of heavy commercial vehicles
  • Farm vehicles and construction equipment
  • Houses, garages, barns, and other buildings on a family farm, if several conditions are met
  • Theatrical productions

Minn. Stat. §144.413: Definition.

Minn. Stat. §144.414: Prohibitions.

Minn. Stat. §144.4167: Permitted smoking.

Individuals under 18 years of age cannot possess, smoke, chew or otherwise ingest, purchase, or attempt to purchase tobacco, tobacco-related devices, or electronic delivery devices or use any type of false identification to misrepresent the person’s age.

Minn. Stat. §609.685: Sale of tobacco to children.

Minneapolis, has raised the tobacco sales age to 21, as have Bloomington, Brooklyn Center, Edina, Eden Prairie, Excelsior, Falcon Heights, Hermantown, Lauderdale, Mendota Heights, Minnetonka, North Mankato, Plymouth, Roseville, Richfield, Shoreview, St. Louis Park, St. Peter, Waseca, and Olmsted, Otter Tail, and Pope Counties.

There is no state restriction on age for selling tobacco products. 

Minnesota Department of Labor & Industry: Child Labor Laws

Similarly, it is illegal for any person to sell or furnish tobacco, tobacco-related devices, or electronic delivery devices to a person under 18 years of age.

Minn. Stat. §609.685: Sale of tobacco to children.

No person shall offer for sale tobacco or tobacco-related devices, electronic delivery devices, or nicotine or lobelia delivery products in open displays that are accessible to the public without the intervention of a store employee. However, this prohibition does not apply to retail stores which derive at least 90 percent of their revenue from tobacco and tobacco-related devices and where the retailer ensures that no person younger than 18 years of age is present, or permitted to enter, at any time.

Minn. Stat. §461.18: Ban on self-service sale of packs; exceptions

Nothing in state law supersedes or precludes the continuation or adoption of any local ordinance that provides for more stringent regulation of youth access to tobacco products. 

Minn. Stat. §609.685(4): Effect on local ordinances.

In Minnesota, no person may distribute smokeless tobacco products or cigarettes, cigars, pipe tobacco, or other tobacco products, except that single-serving samples of tobacco may be distributed in tobacco stores.

Minn. Stat. §325F.77(4): Promotional Distribution

A person who distributes free tobacco product samples is liable for the payment of the tobacco tax.

Minn. Stat. §297F.05(2): Distribution of free sample packages.

Distribution of tobacco products samples is subject to licensing requirements because “sale” is defined to include gifts or samples provided for advertising or promotional purposes, made by a person engaged in the selling of cigarettes or tobacco products.

Minn. Stat. §297F.01(16)

Minnesota law contains no specific provisions concerning state preemption of local tobacco sampling laws, so local communities may pass more stringent laws or ordinances in this area.

Operating Your Business

No person may engage in the business of a tobacco products distributor or subjobber at any place of business without first obtaining a license by filing a License Application for Tobacco Products Distributors and Subjobbers (Form CT101) with the Minnesota Department of Revenue and paying the application fee ($75 for distributors; $20 for subjobbers). Licenses are valid for 2 years and must be renewed by January 1st of every even-numbered year by re-filing Form CT101.

Minn. Stat. §297F.03: Licenses; cigarette and tobacco products distributors and subjobber.

Tobacco products retailers must file a License Application to Make Retail Sales of Cigarette and Other Tobacco Products (Form CT102) with the appropriate municipality when applying for a license in a Minnesota city or county. Prior to making delivery sales or shipping tobacco products in connection with any sales, an out-of-state retailer must file with the Department of Revenue a statement setting forth the out-of-state retailer’s name, trade name, and the address of the out-of-state retailer’s principal place of business and any other place of business.

Minn. Stat. §297F.031: Registration requirement.

Tobacco products distributors with a place of business in Minnesota must file a Tobacco Tax Monthly Return (Form CT-301), applicable schedules, and payment for taxes due on or before the 18th day of each month, even if no tax is due. Tobacco Tax Monthly Returns may be filed electronically through Minnesota e-Services. 

Minn. Stat. §297F.09: Returns; payment of tax.

Additionally, consumers of untaxed tobacco products in Minnesota must file a Tobacco Use Tax Return (Form CT303), along with payment for taxes due.

Minnesota state law does not allow smoking and drinking in the same establishment. Smoking is prohibited in all bars and restaurants, and the smoking ban exemption for tobacco products shops does not include a tobacco department or section of any individual business establishment with any type of liquor, food, or restaurant license.

Minn. Stat. §144.414: Prohibitions.

Minn. Stat. §144.4167: Permitted smoking.

Localities may require additional business licenses.

Form Type / NameForm Number / Link
Minnesota Department of Revenue: Tobacco Tax Forms and InstructionsTax Forms and Instructions
File Cigarette Tax ElectronicallyCigarette Tax E-Filing
File Tobacco Tax Electronically  Tobacco Tax E-Filing

Political Involvement

A “lobbyist” is an individual:

  • engaged for pay or other consideration of more than $3,000 from all sources in any year for the purpose of attempting to influence legislative or administrative action, or the official action of a metropolitan governmental unit, by communicating or urging others to communicate with public or local officials, or
  • who spends more than $250, not including the individual’s own traveling expenses and membership dues, in any year for the purpose of attempting to influence legislative or administrative action, or the official action of a metropolitan governmental unit, by communicating or urging others to communicate with public or local officials

“Lobbyist” does not include:

  • a public official
  • an employee of the state, including an employee of any of the public higher education systems
  • an elected local official
  • a nonelected local official or an employee of a political subdivision acting in an official capacity, unless the nonelected official or employee of a political subdivision spends more than 50 hours in any month attempting to influence legislative or administrative action, or the official action of a metropolitan governmental unit other than the political subdivision employing the official or employee, by communicating or urging others to communicate with public or local officials, including time spent monitoring legislative or administrative action, or the official action of a metropolitan governmental unit, and related research, analysis, and compilation and dissemination of information relating to legislative or administrative policy in this state, or to the policies of metropolitan governmental units
  • a party or the party’s representative appearing in a proceeding before a state board, commission, or agency of the executive branch unless the board, commission, or agency is taking administrative action
  • an individual while engaged in selling goods or services to be paid for by public funds
  • a news medium or its employees or agents while engaged in the publishing or broadcasting of news items, editorial comments, or paid advertisements which directly or indirectly urge official action
  • a paid expert witness whose testimony is requested by the body before which the witness is appearing, but only to the extent of preparing or delivering testimony
  • a party or the party’s representative appearing to present a claim to the legislature and communicating to legislators only by the filing of a claim form and supporting documents and by appearing at public hearings on the claim

Minn. Stat. §10A.01(21)

A “principal” is an individual or association that:

  • spends more than $500 in the aggregate in any calendar year to engage a lobbyist, compensate a lobbyist, or authorize the expenditure of money by a lobbyist, or
  • spends a total of at least $50,000 in any calendar year on efforts to influence legislative action, administrative action, or the official action of metropolitan governmental units

Minn. Stat. §10A.01(33)

Lobbyists must register with the Minnesota Campaign Finance and Public Disclosure Board within 5 days after meeting the criteria for being a lobbyist or, if already registered as a lobbyist, within 5 days after agreeing to represent a new principal. To register, lobbyists must submit a Registration Form to the Board by email to cf.board@state.mn.us or fax to (651) 539-1196.

Minn. Stat. §10A.03: Lobbyist registration.

Lobbyists must file Lobbyist Disbursement Reports online through the Board’s Online Reporting System on January 15th and June 15th of every year. The association or individual represented by the lobbyist must electronically file an Annual Report of Lobbyist Principal each year on March 15th.

Minn. Stat. §10A.04: Lobbyist reports.

Form Type / NameForm Number / Link
Minnesota Campaign Finance and Public Disclosure Board: Lobbyist RegistrationLobbyist Registration
Lobbyist and Lobbyist Principals HandbookLobbyist and Principals Handbook
Campaign Finance and Public Disclosure Board: Registration FormRegistration Form
Campaign Finance Board: Lobbyist Disbursement Online Reporting SystemLobbyist Online Reporting System
Campaign Finance Board: Lobbyist Principal Online Reporting SystemLobbyist Principal Online Reporting System

Shipping Regulations

Minnesota has requirements for the shipping of tobacco products to consumers. A tobacco retailer shipping tobacco products must clearly mark the outside of the package of tobacco products to be shipped “tobacco products – adult signature required” and show the name of the tobacco retailer. Tobacco retailers must also utilize a delivery service that complies with age verification requirements. Age verification requirements also apply to the acceptance of an order for a delivery sale of tobacco products.

If an order is made as a result of advertisement over the Internet, a tobacco retailer is required to request the e-mail address of the purchaser and must receive payment by credit card or check prior to shipping.

Minn. Stat. § 325F.781

In addition, prior to making delivery sales or shipping tobacco products in connection with any sales, an out-of-state retailer must file a statement with the Department of Revenue setting forth the out-of-state retailer’s name, trade name, and the address of the out-of-state retailer’s principal place of business and any other place of business. 

Minn. Stat. § 297F.031

Minn. Stat. § 297F.12

Further, the transportation of tobacco products into Minnesota by means other than common carrier must be reported to the commissioner within 30 days with the following exceptions:

  • transportation of not more than 50 cigars, not more than ten ounces of snuff or snuff powder, or not more than one pound of smoking or chewing tobacco or other tobacco products not specifically mentioned;
  • transportation by a person with a place of business outside the state, who is licensed as a distributor under this chapter, of tobacco products sold by the person to a retailer in this state.

Common carriers transporting tobacco products into Minnesota must file reports of all shipments other than those which are delivered to public warehouses of the first destination in Minnesota.

Records of all deliveries or shipments of tobacco products from any public warehouse of the first destination in Minnesota must be kept by the warehouse and made available for inspection.

Minn. Stat. § 297F.13: Required Records. 

In Minnesota, all distributors and subjobbers, including those located outside Minnesota, must be licensed before they can sell or distribute tobacco products. A separate license is required for eachlocation from which tobacco products are sold at retail. 

A tobacco distributor is defined to include a person who:

  • brings tobacco products into Minnesota;
  • ships or transports tobacco products to Minnesota retailers to be sold by those retailers.

A tobacco subjobber is defined to include a person who:

  • acquires tobacco products from a distributor to sell to retailers; or
  • is a licensed distributor who delivers, sells or distributes tobacco products from a business not covered in a distributor’s license.

Minn. Stat. § 297F.03

Additional information about licensing in Minnesota is available under the Operating Your Business tab above.

A tobacco retailer must utilize a delivery service that imposes the following requirements:

  • An adult must sign for the delivery; and
  • The person signing for the delivery must show valid government-issued identification that contains a photograph of the person signing for the delivery and indicates that the person signing for the delivery is of legal age to purchase tobacco products and resides at the delivery address.
  • The retailer must provide delivery instructions that clearly indicate the above requirements and must declare that state law requires compliance with the requirements.

In addition, when accepting the first order for a delivery sale from a consumer, a tobacco retailer must obtain the following information from the person placing the order:

  • A copy of a valid government-issued document that provides the person’s name, current address, photograph, and date of birth; and
  • An original written statement signed by the person documenting than the person:
    • is of legal age to purchase tobacco products in the state;
    • has made a choice whether to receive mailings from a tobacco retailer;
    • understands that providing false information may be a violation of law; and
    • understands that it is a violation of law to purchase tobacco products for subsequent resale or for delivery to persons who are under the legal age to purchase tobacco products.

Minn. Stat. § 325F.781

Minnesota imposes a tax on all tobacco products in the state and on any person engaged in business as a distributor. For shipping purposes, the tax is imposed at the time the distributor: brings, or causes to be brought into the state from outside the state tobacco products for sale;orships or transports tobacco products to retailers in this state, to be sold by those retailers.

Minn. Stat. §297F.05(3-4a)

For tobacco received by a distributor located in Minnesota: The distributor is liable for the tobacco excise tax. For tobacco sales from a distributor located outside Minnesota: The distributor is liable for the tobacco excise tax when selling to a retailer in Minnesota, but is not liable when selling to a distributor located in Minnesota. 

Tobacco distributors and wholesalers are required to file monthly tax returns. This requirement applies to licensed distributors outside of Minnesota as well. All tobacco tax returns and payments are due on the 18th day of the month following the end of the reporting month. A return must be filed even if there is no tax liability for that month. 

Minn. Stat. § 297F.09: Returns; payment of tax.

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.