WILLIAM DONALD SCHAEFER, Governor

Ch. 2

Subsection (c)(1) of this section is restated as a
formula for a supplemental tax rate, for clarity.
Therefore, the references to the "amount of the
federal tax rate decrease below 0.8 of a cent" and the
phrases "multiplied by 10", "multiplied by 20", and
"multiplied by the number of cigarettes" are
substituted for the former references to the "federal
tax imposed" as being "less than $8 per thousand
cigarettes ... for each 10. cigarettes or fractional
part .... and on each cigarette in excess of 20 ....".

In subsection (c)(3) of this section and throughout

this title, the defined term "wholesaler" is

substituted for the former word "distributor", for

clarity and conformity to the terminology used in the

cigarette industry and by the Comptroller. For

further discussion of the substitution, see the
General Revisor's Note to this subtitle.

Defined terms: "Cigarette" § 12-101
"Sell" § 12-101 "Tobacco tax" § 1-101
"Wholesaler" § 12-101

GENERAL REVISOR'S NOTE:

To revise the tobacco tax law accurately, the Tax - General
Article Review Committee also revised Art. 56, §§ 607 through
631, to include applicable definitions from former Art. 81 and
from the Commercial Law Article and to clarify certain terms and
practices, where appropriate.

Under former Art. 81, a distributor license was issued for a
one-time fee of $1 and was effective for as long as the
distributor remained in business. The license was intended only
to allow a person to buy unstamped cigarettes from a manufacturer
and to buy and affix tax stamps to cigarettes. Each distributor
also was licensed as a cigarette wholesaler.

To clarify the scope of a cigarette wholesaler license, the
Tax - General Article Review Committee combined the licensing
provisions for a cigarette distributor, formerly in Art. 81, with
the licensing provisions for a cigarette wholesaler, formerly in
Art. 56, and designated the licensee as a "wholesaler" in this

article and in present Art. 56. Therefore, Ch. ____, Acts of

1988, which enacted this article, also amended Art. 56, §§ 607
through 631 of the Code to allow a person who obtains a cigarette
"wholesaler license" to engage in the business activities allowed
under former Art. 81 and former Art. 56. The "wholesaler license
fee" is amended to require a $251 initial license fee and a $250
annual license renewal fee.

To conform to the terminology used in the Md. Cigarette
Sales Below Cost Act, CL §§ 11-501 through 11-510, and in the
cigarette industry, the Tax - General Article Review Committee

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