by: Lindsay Sisk
Cigarette Retailers: Are you compliant with the new California tax changes? Has your business done inventory as of April 1, 2017 for the upcoming floor tax return due July 1, 2017?
On April 1, 2017 California started charging an additional $2.00 for each 20 pack of cigarettes sold. Proposition 56 was approved by California voters in November 2016, causing changes for distributors, retailers, and a hefty price tag for consumers. Additionally, on July 1, 2017 other tobacco related products will also see a similar hike.
What does this mean for you? Well, it depends (SALT people love to use this term, got to love sales tax humor). Distributors will be required to collect the additional excise tax from retailers, and in return, retailers will increase prices to the consumer, and the California Board of Equalization will see an increase in revenue.
In the mean time, California is requiring all retailers to take inventory as of April 1, 2017 for all Cigarette items where the lower tax was paid. Once inventory is accounted for, retailers must pay the additional $2.00 (per 20 pack) to the BOE by July 1, 2017.
Below are links to the state website with more information, as well as a copy of the floor tax return required to be filed by retailers.
If you have any questions regarding this return, please email me! I would love to assist you on how to file this return, and discuss the tax ramifications it may have on your business.
More information:
Floor Tax Return:
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Website: http://gable.tax/
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Email: LSisk@gable.tax
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