TR 10: Cigarettes, Cigars and Tobacco

The sale of a cigarette is exempt from sales/use tax in the City of Boulder. However, the sale of any other tobacco product is subject to sales/use tax in the City (subsection 3-2-6(i), BRC, 1981). The State of Colorado at paragraph 39-28-202(4)(a) CRS, defines "cigarette" as:

"cigarette means any product that contains nicotine, is intended to be burned or heated under ordinary conditions of use, and consists of or contains: (I) Any roll of tobacco wrapped in paper or in any substance not containing tobacco; or (II) Tobacco, in any form, that is functional in the product, while, because of its appearance, the type of tobacco used in the filler, or its packaging and labeling, is likely to be offered to, or purchased by, consumers as a cigarette; or (III) Any roll of tobacco wrapped in any substance containing tobacco that, because of its appearance, the type of tobacco used in the filler, or its packaging and labeling, is likely to be offered to, or purchased by, consumers as a cigarette described in subparagraph (I) of this paragraph (a)."

The State of Colorado collects an excise tax on the sale of cigarettes and distributes the proceeds to Colorado cities.

The sales of cigars, chewing tobacco, pipe tobacco, snuff and products used in conjunction with these tobacco products are taxable. If one of the above tobacco products are sold in a vending machine, the tax can be included in the sales price.

Example:

• A smoke shop sells a pack of cigarettes, a bag a pipe tobacco, 2 cigars and rolling papers. The shop must collect sales tax on all of the items sold except the cigarettes.

Last Updated on Wednesday, 11 July 2012 12:27