Tennessee Information
Tennessee State Senators
Tobacco Taxes
Tennessee's excise tax per pack of cigarettes: $0.200
Tennessee's excise tax collection for the
fiscal year ending June 2002: $77,117,000
Sales tax on tobacco products: 8.25%
Local tax on tobacco products: $22,900
Federal excise tax per pack of cigarettes: $0.39
Total federal excise tax collections in fiscal year 2002: $7,512,700,000
| Who Profits from
Cigarette Sales? 
click for larger view |
Comparing Excise Taxes on Cigarettes, Beer and Wine
click for larger view | Number of six-packs of beer that must be sold in Tennessee to produce the same state excise tax revenue generated by one carton of cigarettes: 28.4
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click for larger view | Number of bottles of wine that must be sold in Tennessee to produce the same state excise tax revenue generated by one carton of cigarettes: 8.3
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Tennessee Smokers' Contributions
to the State Economy - 2001
Tennessee smokers comprise only 25.7% of the adult population in the state. Here is what they already pay because they choose to buy a legal product: | Smokers Pay Excise Taxes1 | $ | 80,331,810 | | Smokers Pay Sales Taxes1 | $ | 154,484,250 | | Smokers Pay Tobacco Settlement Payments2 | $ | 150,900,000 | | | $ | 385,716,060 |
Smokers' Economic/Tax Profile
| Tennessee smokers' median income 2000 | $ | 27,492 |
- Smoker Excise Tax/Sales Tax/Tobacco Settlement Payments Liability
| Total average paid per Tennessee smoker in excise and sales taxes | $ | 213 | | Cost per Tennessee smoker for settlement payments to Tennessee | $ | 137 | | Total annual payment to Tennessee per smoker | $ | 350 |
Tennessee Smoker Facts - Tennessee smoker payments were more than 5 times as large as state excise tax collections on alcoholic beverages ($71.9 million).4
- Tennessee smoker payments of $385.7 million were 78% as large as Tennessee corporate net income tax revenues of $491.7 million in 2001.4
- Tennessee smoker payments could supply all the funds the state budgeted for 2001-2002 for:4
- Housing Development ($263.6 million, exclusive of bonds)
OR - The Tennessee Bureau of Investigation ($41.5 million) and Safety, including the Highway Patrol ($152.1 million) and Mental Health ($188 million).
- Tennessee smoker payments could also fund nearly all programs run through the Department of Health ($388 million).4
- In 1997, smokers supported 24,795 jobs that paid an additional $4,432,898 in state and local personal income and corporate taxes.5
| TOTAL SMOKER CIGARETTE PAYMENTS TO TENNESSEE |
| | | Per year: | $ | 385,716,060 | | Per day: | $ | 1,056,033 | | Per hour: | $ | 44,001 | | Per minute: | $ | 733 | | Per second: | $ | 12 |
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CIGARETTES DON'T PAY TAXES -
TENNESSEE SMOKERS DO!!
- Tennessee Department of Revenue
- Campaign for Tobacco-Free Kids
- Centers for Disease Control
- U.S. Census Bureau and Tennessee budget documents.
- Economic Impact of Tobacco - 1997
Master Settlement Agreement Payments To Date $580,999,792 has been paid to Tennessee since the Master Settlement Agreement was signed on November 23, 1998.
A summary of Tennessee state law is provided below
(for specific questions regarding state law, contact your legal advisor.)
| Minimum Age | Customers must be 18 years or older to purchase tobacco products and/or smoking paraphernalia. In addition, it is unlawful for any person to purchase a tobacco product on behalf of a minor or to persuade, entice, send or assist a person who has not attained 18 years of age to purchase, acquire, receive or attempt to purchase, acquire or receive a tobacco product or smoking paraphernalia. | | Restricted Products | Any product that contains tobacco including, but not limited to cigars, cigarettes and bidis. Also, cigarette holders, cigarette papers, smoking pipes, water pipes or other items designated primarily to hold smoking material while the smoking material is being smoked. | | Acceptable Forms of Identification | A driver’s license or other generally accepted means of identification that describes the individual as 18 years of age or older, contains a photograph or other likeness of the individual, and appears on its face to be valid. | | Fine/Penalty Schedule for Selling to Minors | Violators shall receive a warning letter for a first violation; a civil penalty of up to $500 for a second violation within 5 years; up to $1,000 for a third violation within 5 years; and up to $1,500 for a fourth or subsequent violation within 5 years. The store owner may be guilty of a violation if he knowingly permits the sale to occur.
The commissioner is authorized to assess the penalty against any person determined by the commissioner to be responsible, in whole or in part, for contributing to or causing the violation to occur, including the owner, manager or employee. Violation of this provision is also a Class C misdemeanor. A person engaged in the sale or distribution of tobacco products shall demand proof of age from a prospective purchaser or recipient if an ordinary person would conclude on the basis of appearance that the prospective purchaser or recipient may be under 27 years of age.
Any person who disseminates smoking paraphernalia to minors or persuades, entices, sends, or assists a minor to purchase, acquire, receive or attempt to purchase, acquire or receive smoking paraphernalia is guilty of is a Class C misdemeanor. Any vendor convicted of violating any provision regarding smoking paraphernalia on three (3) separate occasions is prohibited from selling smoking paraphernalia, or from possessing such items for resale, for a period of five (5) years from the date of the last conviction. In addition, violation is a Class B misdemeanor, punishable by imprisonment up to six months and/or a fine of up to five hundred dollars.
The owner or manager shall provide training to the store's employees concerning the provisions of the youth access law. As a part of this training, each employee shall sign a statement containing substantially the following words: "I understand that state law prohibits the sale of tobacco products to persons under eighteen (18) years of age and that state law requires me to obtain proof of age from a prospective purchaser of tobacco products who, based on appearance, might be as old as twenty-six (26) years of age. I promise to obey this law, and I understand that monetary or criminal penalties may be imposed on me if I violate this law." For a second violation, the retailer will not be subject to penalty, if the owner or manager presents a copy of the statement signed by the employee who made the sale to a minor to the commissioner, along with a sworn statement by the owner or manager that the employee had signed the statement prior to the sale to the minor. For a third violation, the commissioner shall consider such evidence and any other evidence with respect to the amount of the penalty against the owner or manager.
| | Affirmative Defense | A person who demanded, was shown, and reasonably relied upon proof of age shall not be liable for a civil penalty. | | Minor Possession | The purchase, possession or receipt of tobacco products by minors, or the offer of a fake ID for the purpose of purchasing or receiving any tobacco product is prohibited. It is not unlawful for a person under 18 years of age to handle tobacco in the course of employment, provided that the person is under the supervision of another employee who is at least 21 years of age. Any person who violates this section shall be issued a citation by a law enforcement officer or school principal who has evidence of the violation and shall be subject to a penalty of $10-$50. The Juvenile Court may also impose community service work not to exceed 50 hours for a second or subsequent violation within a 1 year period. A minor shall not, directly or indirectly, purchase or acquire smoking paraphernalia. Any minor so purchasing or acquiring is subject to juvenile proceedings. A person contemplating the selling, offering to sell or giving of smoking paraphernalia to an individual whom the person believes or has reason to believe may be a minor shall demand identification containing proof of age from the individual. Failure to do so is a Class C misdemeanor, punishable by imprisonment up to thirty days and/or a fine of up to fifty dollars. | Sign Requirement
 | Retailers of tobacco products and/or smoking paraphernalia are required to conspicuously post a sign at their place of business, so that it is likely to be read at each point of sale, that states:
STATE LAW STRICTLY PROHIBITS THE SALE OF TOBACCO PRODUCTS OR SMOKING PARAPHERNALIA TO PERSONS UNDER THE AGE OF EIGHTEEN (18) YEARS. PROOF OF AGE MAY BE REQUIRED.
The sign must be at least 93 1/2 square inches. If a sign is not posted, violators shall receive a warning letter for a first violation and a civil penalty of not more than $500 for a second violation within 5 years, not more than $1,000 for a third violation within 5 years, and not more than $1,500 for a fourth or subsequent violation within 5 years. Violation of this provision is also a Class C misdemeanor.
| | Compliance Checks | As a condition of receiving federal substance abuse block grant funds, federal law requires the State of Tennessee to conduct random, unannounced inspections of tobacco outlets to determine compliance rates. The Department of Agriculture will coordinate the inspections. | | DISCLAIMER: This information summary is provided as a service of the Coalition, but is not intended to provide legal advice or analysis. These summaries are not intended to be complete representations of state law, which may contain additional rules and restrictions relating to tobacco products not mentioned in this summary, as well as retailing prohibitions related to matters including, but not limited to, state required training, minimum pack size, the sale of loose cigarettes and other restrictions. Retailers should not rely on these summaries as complete or accurate descriptions of applicable federal, state or local law. Users with questions about the law should seek the advice of counsel. Each state law is unique and possibly represents multiple legislative or regulatory acts. Local laws may differ. Check with local authorities for variations from state law. These summaries are not intended to be complete representations of state law. |
The reprinting of this information from the Coalition, does not constitute a representation or admission by RJRT that such information is accurate, complete, or a proper characterization of the laws concerned. The Coalition for Responsible Tobacco Retailing is a cooperative effort among retailers, wholesalers and manufacturers who share a common goal: to do all they can to prevent tobacco sales to minors.
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