Distributors pay the Tobacco Tax to the Minnesota Department of Revenue on tobacco products other than cigarettes (which are subject to the Cigarette Tax).
The tax applies to all tobacco products in Minnesota (except cigarettes as noted above). The tax is charged when a distributor:
- brings tobacco products into Minnesota or has them transported into Minnesota from outside the state;
- makes or manufactures tobacco products in Minnesota for sale in the state; or
- ships or transports tobacco products to retailers in Minnesota for sale by those retailers.
The excise tax on tobacco is equal to 95 percent of the wholesale sales price of the tobacco product.
The excise tax on premium cigars is 95 percent of the wholesale sales price or $3.50 per cigar, whichever is less.
A premium cigar:
- is hand-constructed and hand-rolled;
- has a wrapper made entirely from whole tobacco leaf;
- has a filler and binder made entirely of tobacco, except for adhesives or other materials used to maintain size, texture, or flavor; and
- has a wholesale price of $2.00 or more.
The excise tax on “moist snuff” is 95 percent of the wholesale sales price or $3.04 per container, whichever is greater.
Moist snuff means any finely cut, ground, or powered smokeless tobacco that is intended to be placed or dipped in the mouth.
A container of moist snuff means the smallest consumer-size can, package, or other container that is marketed or packaged by the manufacturer, distributor, or retailer for separate sales to a retail or consumer customer. When you have a sleeve or more than one container of moist snuff packaged or grouped together, each separate container will be tracked and subject to tax.
Tobacco Use Tax
If you bring tobacco products into the state, but didn't pay the Minnesota Tobacco Tax when you purchased the products, you might need to pay the tax directly to Minnesota. See Tobacco Use Tax.