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Last Updated: 7/11/2017

Cigarette Tax

2017 Legislative Changes on Premium Cigars and Moist Snuff

Calculating the Price of a Premium Cigar

Beginning July 1, 2017 the Tobacco Excise Tax on premium cigars will be the lesser of 95 percent of the “wholesale sales price” of the cigar or 50 cents.

Premium Cigar Definition

A “premium cigar” is any cigar that is hand-constructed, has a wrapper that is made entirely from whole tobacco leaf, has a filler and binder that is made entirely of tobacco, except for adhesives or other materials used to maintain size, texture, or flavor, and has a “wholesale price” of no less than $2. (See Minnesota Statute 297F.01, subd. 13a.)

Determining Wholesale Price

To determine whether a cigar meets the definition of a premium cigar, “wholesale price” is the price that a retailer or cigar sub-jobber pays a distributor for the cigar.

Wholesale price is different from “wholesale sales price” defined in M.S. 297F.01, subd. 13a., which is generally the price that the distributor/taxpayer pays their vendor for their cigar products.

See Determining Wholesale Price of Premium Cigar for a table with price scenarios. The table assumes that the cigar meets all other necessary characteristics to qualify as a “premium cigar."

Note: The Tobacco Tax changes contained in Minnesota Laws 2017, 1st Special session, Chapter 1, are the subject of on-going negotiations. We will provide updates as appropriate.

Moist Snuff Tax Calculation

The way you determine the Tobacco Tax rate on moist snuff containers brought into or manufactured in  Minnesota that weigh more than 1.2 ounces has changed. Effective July 1, 2017, the tax on any container weighing more than 1.2 ounces is the greater of:

  • 95 percent of the wholesale sales price of the moist snuff, or
  • $3.04 multiplied by the ounces and divided by 1.2

Updated Forms

Please use the revised forms when you file your July return due August 18.

If you file paper returns:

If you file your moist snuff return electronically with our file templates: