Cigarette and Tobacco Taxes Frequently Asked Questions
Q: Who is responsible for North Dakota cigarette and tobacco taxes?
A: Any person, who first purchases, sells or brings cigarettes or tobacco products into the state for resale is required to pay the tax. In addition, individuals who purchase cigarettes or tobacco products for personal consumption from sources outside this state are required to pay the tax. Cigarette and tobacco taxes are paid monthly primarily by wholesalers and distributors.
Q: What are the cigarette and tobacco tax rates in North Dakota?
A: In North Dakota, cigarettes are subject to a cigarette tax of 22 mills per cigarette (a mill equals one tenth of a cent). The tax on a package of 20 cigarettes is 44 cents. The tax on a carton of 200 cigarettes is $4.40.
Pipe tobacco and cigars are subject to a tobacco tax of 28% of the wholesale purchase price. Chewing tobacco is taxed at 16 cents per ounce and snuff is taxed at 60 cents per ounce.
Q: Are cigarette packages stamped in North Dakota as in other states?
A: North Dakota does not stamp cigarette packages. In North Dakota, the cigarette tax is paid to the state on a monthly report by licensed cigarette wholesalers.
Q: Can cigarettes and tobacco products be purchased legally over the Internet or on an Indian Reservation?
A: Sales over the Internet: Individuals may legally purchase cigarettes and tobacco products over the Internet; however, the purchaser has an obligation to report and pay the cigarette tax on purchases greater than 200 cigarettes and the tobacco tax due on all tobacco purchases. North Dakota use tax also applies to the purchase price. A remittance form is available from the Office of State Tax Commissioner by calling 701-328-3475.
Sales to Native American Retailers: Cigarettes or tobacco products imported or purchased by a Native American operating a retail tobacco business within an Indian reservation and who is an enrolled member of the tribe residing on that reservation is exempt from tax when the products are delivered to the Native American retailer on the reservation. Retail businesses that purchase untaxed cigarettes or tobacco products from a Native American retailer must register to report and pay the applicable cigarette or tobacco tax by calling 701-328-3475.
In addition, individuals that are not enrolled members of the tribe that purchase from a Native American retailer must report and pay tax on purchases for their own use. Individuals that are not enrolled tribal members must pay cigarette tax on purchases greater than 200 cigarettes or the tobacco tax due on any purchase of other tobacco products. North Dakota use tax also applies to these purchases. A remittance form is available by calling the Office of State Tax Commissioner at 701-328-3475.
Q: As a business, how do I obtain a license to sell cigarettes and tobacco products?
A: The North Dakota Attorney General's Office issues retail and wholesale tobacco licenses. For more information, we suggest you contact the Licensing Division at the Attorney General's Office at 701-328-2210 for assistance with licensing requirements.
New wholesalers or retailers purchasing untaxed cigarette or tobacco products must contact the Office of State Tax Commissioner at 701-328-3475 to obtain forms to report cigarette and tobacco tax information.
Q: When were the cigarette and tobacco tax rates last increased?
A: The cigarette tax on a package of 20 cigarettes was increased in 1993 to 22 mills (44 cents) from 14.5 mills (29 cents). The tobacco products tax was also increased to 28% from 22% in 1993. In 2001, the tax on snuff and chewing tobacco was changed from 28% of the wholesale purchase price to a tax based on weight. Snuff is taxed at 60 cents per ounce and chewing tobacco taxed at 16 cents per ounce.