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Last Updated: 2/14/2014

Fee In Lieu of Settlement

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​What is the Fee in Lieu of Settlement?

The Fee in Lieu of Settlement is imposed on cigarettes produced by manufacturers that have not entered into a tobacco settlement agreement with the state of Minnesota. The fee is 2.5 cents per cigarette (50 cents per pack of 20 cigarettes). The fee is meant to help the state recover some of the public healthcare costs related to smoking. 

When did it go into effect?

The Fee in Lieu of Settlement went into effect on July 1, 2003.

Who or what does the fee apply to?

The Fee in Lieu of Settlement is imposed on cigarettes produced by all manufacturers except Philip Morris, R. J. Reynolds, Lorillard or Liggett. The fee does not apply to cigarettes produced by those manufacturers because they have entered into a settlement agreement and make annual payments to the state of Minnesota. 

To identify cigarette brands and their manufacturers, follow the link below. Any cigarettes that are not manufactured by one of the four companies listed above are subject to the Fee In Lieu of Settlement.

Visit Nebraska Department of Revenue to view a list of cigarette brands and their manufacturers.