Cigarette & Cigarette Use Taxes
Statutory Reference
Electronic Services
Illinois Licensed Cigarette Distributors or Manufacturers
Definition
The Cigarette Tax Act imposes a tax on the occupation of selling cigarettes at retail. Licensed
distributors prepay the tax through the purchase of stamps, which are affixed (either heat-transferred or handapplied)
to each cigarette package. The distributor collects the tax from the retailer at or before the time of sale. The
retailer passes the tax on to the consumer in the cigarette sale price.
The Cigarette Use Tax Act imposes a tax on the privilege of using cigarettes in Illinois. This act duplicates the
provisions of the Cigarette Tax Act.
NOTE: Tobacco products other than cigarettes are also taxed. (See "
Tobacco Products Tax.")
Tax Rate
Use the
“Tax Rate Database” to locate the rate for both Cigarette Tax and Cigarette Use
Tax.
Allowable Deductions
- sales out-of-state;
- cigarettes returned to manufacturers;
- cigarettes lost through fire, theft, etc., that is supported by proper documentation;
- sales of cigarettes to residents incarcerated in penal institutions and to resident patients of state-operated mental health facilities that have been manufactured as part of a correctional industries program;
- sales to U.S. military personnel through officially recognized agencies physically located at military bases; and
- direct sales to U.S. veteran's hospitals.
Additional Registration, License fee and bonding requirements
In addition to filing
Form REG-1, Illinois Business Registration Application, distributors must pay a $250 annual fee and post a $2,500 bond for each location. You may also register using our
On-line Business Registration program.
Form IDR-169, Application for Cigarette Transporter Permit, must be completed if unstamped cigarettes will be
• purchased as a sale for resale in a state other than Illinois,
• transported through Illinois but not sold in Illinois, and
• delivered to another state.
These cigarettes cannot be returned to Illinois.
Secondary distributors must also be licensed. A secondary distributor is any person engaged in the business of
selling cigarettes, who purchases stamped original packages of cigarettes from a licensed distributor under the
Cigarette Tax Act or the Cigarette Use Tax Act, sells 75% or more of those cigarettes to retailers for resale, and
maintains an established business where a substantial stock of cigarettes is available to retailers for resale.
Local Taxes
Both home rule and non-home rule municipalities may impose a cigarette tax. However, a home rule municipality cannot enact a new cigarette tax after July 1, 1993, nor can an existing cigarette tax be levied if the home rule government imposes a municipal sales tax. The Department of Revenue
does not collect locally imposed cigarette taxes.
Form/Filing & Payment Requirements
Returns
- The in-state distributors return, Form RC-6, Cigarette Revenue Return is due monthly by the 15th day of the month following the end of the reporting period.
- The out-of-state distributors return, Form RC-6-A, Out-of-state Cigarette Revenue Return, is due monthly by the 15th day of the month following the end of the reporting period.
- Form RC-25, Cigarette Importation Report, Distributors who affix stamps to cigarettes imported into the United States must file this form by the first business day of the month following the end of the reporting period.
- Form RC-1-A, Cigarette Tax Stamp Order-Invoice, Distributors who purchase stamps file this form as needed.
- Form RC-44, Cigarette Use Tax Return, Unlicensed individuals pay tax on unstamped cigarettes purchased from a seller by filing this form as needed, on a per-purchase basis, within 30 days of the purchase.
Electronic Filing
A taxpayer who has 30 or more transactions per month must file electronically. For more information refer to the
RC-750, Electronic Filing - Cigarette Returns.
Electronic Payments
Beginning July 1, 2003, all cigarette revenue tax stamp purchases must be paid by
Electronic Funds Transfer (EFT) .
