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S4012
SENATE, No. 4012
STATE OF NEW JERSEY
222nd LEGISLATURE
�
INTRODUCED MARCH 19, 2026
Sponsored by:
Senator� JOSEPH F. VITALE
District 19 (Middlesex)
SYNOPSIS
���� Modifies tax rate on certain tobacco and nicotine
products.
CURRENT VERSION OF TEXT
���� As introduced.
��
An Act
modifying the tax rate on certain tobacco and nicotine
products and amending P.L.1990, c.39 and P.L.2006, c.37.
����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:
���� 1.��� Section 2 of P.L.1990,
c.39 (C.54:40B-2) is amended to read as follows:
���� 2.��� As used in sections 2
through 14 and section 20 of P.L.1990, c.39 (C.54:40B-1 et seq.):
���� "Consumer" means a
person except a distributor, manufacturer, or wholesaler who acquires a tobacco
product for consumption, storage, or use in this State
[
;
]
.
���� "Container e-liquid"
means a container of liquid nicotine or other liquid where the liquid is
marketed, sold, or intended for use in an electronic smoking device, but does
not include a prefilled cartridge or other container where the cartridge or
container is marketed, sold, or intended for use as, or as a part of, an
electronic smoking device
[
;
]
.
���� "Director" means the
Director of the Division of Taxation in the Department of the Treasury
[
;
]
.
���� "Distributor" means:
���� a person engaged in the
business of selling tobacco products in this State who brings, or causes to be
brought into this State from without the State a tobacco product for sale
within this State
[
,
]
;
���� a person who makes or
manufactures tobacco products in this State for sale in the State
[
,
]
;
���� a person engaged in the
business of selling tobacco products without this State who ships or transports
tobacco products to a person in this State to be sold to a retail dealer
[
,
]
;
or
���� a person who receives tobacco
products without receiving proof that the tax has been or will be paid by
another distributor
[
;
]
.
���� "Dry snuff" means
any finely cut, ground, or powdered smokeless tobacco that is intended to be
sniffed through the nasal cavity, but does not include moist snuff
[
;
]
.
���� "Electronic smoking
device" means a nonlighted, noncombustible device that may be used to
simulate smoking and that employs a mechanical heating element, battery, or
circuit, regardless of shape or size, to produce aerosolized or vaporized nicotine
or other substance for inhalation into the body of a person, including but not
limited to a device that is manufactured, distributed, marketed, or sold as an
e-cigarette, e-cigar, e-pipe, e-hookah, vape pen, or any other similar product
with any other product name or descriptor
[
;
]
.
���� "Liquid nicotine"
means any solution containing nicotine that is designed or sold for use with an
electronic smoking device
[
;
]
.
���� "Manufacturer" means
a person, wherever resident or located, who manufactures or produces, or causes
to be manufactured or produced, a tobacco product and sells, uses, stores, or
distributes the product regardless of whether it is intended for sale, use, or
distribution within or without this State
[
;
]
.
���� "Moist snuff" means
any finely cut, ground, or powdered smokeless tobacco that is intended to be
placed or dipped in the oral cavity, but does not include dry snuff
[
;
]
.
����
�Oral nicotine pouch� means
a tobacco-free pouch intended for oral use that contains nicotine.
���� "Person" means an
individual, firm, corporation, copartnership, joint venture, association,
receiver, trustee, guardian, executor, administrator, or any other person
acting in a fiduciary capacity, or an estate, trust, or group or combination acting
as a unit, the State Government and any political subdivision thereof, and the
plural as well as the singular, unless the intention to give a more limited
meaning is disclosed by the context
[
;
]
.
���� "Place of business"
means a place where a tobacco product is sold or where a tobacco product is
brought or kept for the purpose of sale or consumption, including so far as may
be applicable a vessel, vehicle, airplane, train or vending machine
[
;
]
.
���� "Retail dealer"
means a person who is engaged in this State in the business of selling any
tobacco product at retail.� A person placing a tobacco product vending machine
at, or on any premises shall be deemed to be a retail dealer for each vending
machine
[
;
]
.
���� "Sale" means any
sale, transfer, exchange, barter, or gift, in any manner or by any means
whatsoever
[
;
]
.
���� "Tobacco product"
means any product containing, made, or derived from any tobacco, nicotine, or
other chemicals or substances for consumption by a person, including, but not
limited to, cigars, little cigars, cigarillos, chewing tobacco, pipe tobacco,
smoking tobacco and their substitutes, dry and moist snuff,
[
and
]
liquid
nicotine,
and oral nicotine pouches,
but does not include cigarette as
defined in section 102 of the "Cigarette Tax Act," P.L.1948, c.65
(C.54:40A-1 et seq.)
[
;
]
.
���� "Treasurer" means
the State Treasurer
[
;
]
.
���� "Use" means the
exercise of any right or power incidental to the ownership of a tobacco
product, including a sale at retail
[
;
]
.
���� "Vapor business"
means a retail business where more than 50 percent of its retail sales are
derived from electronic smoking devices, related accessories, and liquid
nicotine, but does not include a retail business that does not sell container e-liquid
[
;
]
.
���� "Wholesale price"
means the actual price for which a manufacturer sells tobacco products to a
distributor
[
;
and
]
.
���� "Wholesaler" means a
person, wherever resident or located, other than a distributor as defined
herein, who:
����
[
a.
]
purchases tobacco products from
any other person who purchases from the manufacturer and who acquires tobacco
products solely for the purpose of bona fide resale to retail dealers or to
other persons for the purposes of resale only; or
����
[
b.
]
services retail outlets by the
maintenance of an established place of business for the purchase of tobacco
products including, but not limited to, the maintenance of warehousing
facilities for the storage and distribution of tobacco products.
(cf: P.L.2019, c.147, s.2)
���� 2.��� Section 3 of P.L.1990,
c.39 (C.54:40B-3) is amended to read as follows:
���� 3.� a.� There is imposed a tax
of
[
30%
]
50 percent
upon the wholesale price upon the sale, use, or distribution of a tobacco
product within this State, except that if the product is:
���� (1)�� moist snuff, the tax
shall be imposed as provided in section 3 of P.L.2006, c.37 (C.54:40B-3.1); or
���� (2)�� liquid nicotine, the tax
shall be imposed as provided in section 5 of P.L.2018, c.50 (C.54:40B-3.2).
���� b.��� Unless a tobacco product
has already been or will be subject to the wholesale sales tax imposed in
subsection a. of this section, if a distributor or wholesaler uses a tobacco
product within this State, there is imposed upon the distributor or wholesaler
a compensating use tax of
[
30%
]
50 percent
measured by the sales price of a similar tobacco product to a distributor,
except that if the product is moist snuff or liquid nicotine, the tax shall be
imposed as provided in section 3 of P.L.2006, c.37 (C.54:40B-3.1) or section 5
of P.L.2018, c.50 (C.54:40B-3.2), respectively.
���� c.���� Unless a wholesale use
tax is due pursuant to subsection b. of this section, if a distributor or
wholesaler has not paid the wholesale sales tax imposed in subsection a. of
this section upon a sale that is subject to the wholesale sales tax imposed in
that subsection a., there is imposed upon the retail dealer or consumer
chargeable for the sale a compensating use tax of
[
30%
]
50 percent
of the price
paid or charged for the tobacco product, except that if the product is moist
snuff or liquid nicotine, the tax shall be imposed as provided in section 3 of
P.L.2006, c.37 (C.54:40B-3.1) or section 5 of P.L.2018, c.50 (C.54:40B-3.2),
respectively, which shall be collected in the manner provided in subsection b.
of section 5 of P.L.1990, c.39 (C.54:40B-5).
(cf: P.L.2018, c.50, s.4)
���� 3.��� Section 3 of P.L.2006,
c.37 (C.54:40B-3.1) is amended to read as follows:
���� 3.� a.� There is imposed a tax
upon the sale, use
,
or distribution of moist snuff within this State by
a distributor or wholesaler to a retail dealer or consumer at the rate of
[
$0.75
]
$1.50
per ounce on the net weight, as listed by the manufacturer, of the moist snuff,
and a proportionate rate on all fractional parts of an ounce of the net weight
of moist snuff.
���� b.��� Unless a moist snuff
product has already been or will be subject to the wholesale sales tax imposed
in subsection a. of this section, if a distributor or wholesaler uses the moist
snuff within this State, there is imposed upon the distributor or wholesaler a
compensating use tax of
[
$0.75
]
$1.50
per ounce on the net weight, as listed by the manufacturer, of the moist snuff,
and a proportionate rate on all fractional parts of an ounce of the net weight
of moist snuff.
���� c.���� Unless a wholesale use
tax is due pursuant to subsection b. of this section, if a distributor or
wholesaler has not paid the wholesale sales tax imposed in subsection a. of
this section upon a sale that is subject to the wholesale sales tax imposed in
that subsection a., there is imposed upon the retail dealer or consumer
chargeable for the sale a compensating use tax of
[
$0.75
]
$1.50
per ounce on the
net weight, as listed by the manufacturer, of the moist snuff, and a
proportionate rate on all fractional parts of an ounce of the net weight of
moist snuff, which shall be collected in the manner provided in subsection b.
of section 5 of P.L.1990, c.39 (C.54:40B-5).
(cf: P.L.2006, c.37, s.3)
���� 4.��� (New section)� a.� Each
distributor and wholesaler shall, on or before the first day of the second
month after the effective date of P.L.���� , c.��� (pending before the
Legislature as this bill), file a return, under oath or certified under the
penalties of perjury, with the director on forms furnished by the director,
showing the amount of tobacco products in that distributor�s or wholesaler�s
possession in the State at 12:01 a.m. on the effective date of P.L.��� , c.���
(pending before the Legislature as this bill), and shall, at the time of filing
that return, pay an amount of tax equal to the additional tax , imposed under
section 3 of P.L.1990, c.39 (C.54:40B-3), as amended by P.L.���� , c.���
(pending before the Legislature as this bill), on the amount of tobacco
products in that distributor�s or wholesaler�s possession to the director.�
Failure to obtain such forms shall not be an excuse for the failure to make a
return containing the information required by the director.
���� b.� Each retail dealer shall,
on or before the first day of the second month after the effective date of
P.L.���� , c.��� (pending before the Legislature as this bill), file a return,
under oath or certified under the penalties of perjury, with the director on
forms furnished by the director, showing the amount of tobacco products in that
retail dealer�s possession in the State at 12:01 a.m. on the effective date of
P.L.���� , c.��� (pending before the Legislature as this bill), and shall file
a return with the director in such form as the director may prescribe and
shall, at the time of filing that return, pay an amount of tax equal to the
additional tax, imposed under section 3 of P.L.1990, c.39 (C.54:40B-3), as
amended by P.L.���� , c.��� (pending before the Legislature as this bill), on
the amount of tobacco products in that retail dealer�s possession to the
director.� Failure to obtain such forms shall not be an excuse for the failure
to make a return containing the information required by the director.
���� 5.��� (New section)� a.� Each
distributor and wholesaler shall, on or before the first day of the second
month after the effective date of P.L.���� , c.��� (pending before the
Legislature as this bill), file a return, under oath or certified under the
penalties of perjury, with the director on forms furnished by the director,
showing the amount of moist snuff in that distributor�s or wholesaler�s
possession in the State at 12:01 a.m. on the effective date of P.L.��� , c.���
(pending before the Legislature as this bill), and shall, at the time of filing
that return, pay an amount of tax equal to the additional tax, imposed under
section 3 of P.L.2006, c.37 (C.54:40B-3.1), as amended by P.L. , c.��� (pending
before the Legislature as this bill), on the amount of moist snuff in that
distributor�s or wholesaler�s possession to the director.� Failure to obtain
such forms shall not be an excuse for the failure to make a return containing
the information required by the director.
���� b.� Each retail dealer shall,
on or before the first day of the second month after the effective date of
P.L.���� , c.��� (pending before the Legislature as this bill), file a return,
under oath or certified under the penalties of perjury, with the director on
forms furnished by the director, showing the amount of moist snuff in that
retail dealer�s possession in the State at 12:01 a.m. on the effective date of
P.L.���� , c.��� (pending before the Legislature as this bill), and shall file
a return with the director in such form as the director may prescribe and
shall, at the time of filing that return, pay an amount of tax equal to the
additional tax, imposed under section 3 of P.L.2006, c.37 (C.54:40B-3.1), as
amended by P.L.���� , c.��� (pending before the Legislature as this bill), on
the amount of moist snuff in that retail dealer�s possession to the director.�
Failure to obtain such forms shall not be an excuse for the failure to make a
return containing the information required by the director.
���� 6.� This act shall take effect
immediately, except that sections 2 and 3 of this act shall apply to sales,
uses, or distributions occurring on or after the first day of the second month
next following the date of enactment.
STATEMENT
���� This bill increases the tax
rate imposed on tobacco products subject to the tobacco products wholesale tax
to 50 percent of the product�s wholesale price, and increases the tax rate on
moist snuff to $1.50 per ounce.
���� Under current law, tobacco
products are taxed at a rate of 30 percent of the wholesale price of the
product, which tax rate has been in effect since 2018.� However, this tax rate
does not apply to moist snuff, liquid nicotine, or cigarettes.� Moist snuff is
currently taxed at a rate of $0.75 per ounce, which tax rate has been in effect
since 2006.
���� The bill would require
distributors, wholesalers, and retail suppliers in the State to submit
inventory reports to the State on or before the first day of the second month
after enactment, and these persons would be required to pay the increased rates
of tax on the inventories of any tobacco products and moist snuff held in
inventory on the time at which the tax rate increases go into effect.
���� The bill also amends the
definition of a �tobacco product� to explicitly identify oral nicotine pouches
among the tobacco products which are currently subject to the tobacco wholesale
tax.� An �oral nicotine pouch� is defined as a tobacco-free pouch intended for
oral use that contains nicotine.� These pouches are commonly referred to by
their brand name, such as ZYN.
���� Under current law, a �tobacco
product� is defined as any product containing, made, or derived from any
tobacco, nicotine, or other chemicals or substances for consumption by a
person, including, but not limited to, cigars, little cigars, cigarillos, chewing
tobacco, pipe tobacco, smoking tobacco and their substitutes, dry and moist
snuff, and liquid nicotine, but does not include cigarettes.