Basic information
Outline of the system
The Internal Revenue Code of 1986 (Title 26 U.S.C. Chapter 52 – please see http://www.gpo.gov/fdsys/granule/USCODE-2011-title26/USCODE-2011-title26... subchapA-partIV-subpartF-sec52/content-detail.html) requires that manufacturers and importers of tobacco products or processed tobacco and proprietors of export warehouses (bonded internal revenue warehouses for the storage of tobacco products or cigarette papers or tubes or any processed tobacco, upon which the internal revenue tax has not been paid, for subsequent export) must apply for and obtain a permit from TTB before engaging in such businesses. The primary purpose of these permits is to ensure proper collection of Federal excise tax revenue from tobacco products.
Product coverage
As noted, manufacturers and importers of tobacco products or processed tobacco and proprietors of export warehouses (bonded internal revenue warehouses for the storage of tobacco products or cigarette papers or tubes or any processed tobacco, upon which the internal revenue tax has not been paid, for subsequent export) must apply for and obtain a permit from TTB before engaging in such businesses. Tobacco products are defined in the Internal Revenue Code as cigarettes, cigars, smokeless tobacco (that is, chewing tobacco or snuff), pipe tobacco, and roll your own tobacco. Manufacturers of tobacco products and export warehouse proprietors are required to maintain a bond related to their Federal excise tax liability. Processed tobacco is any tobacco that has undergone processing, but does not include tobacco products. The processing of tobacco includes, but is not limited to, stemming (that is, removing the stem from the tobacco leaf), fermenting, threshing, cutting, or flavouring the tobacco, or otherwise combining tobacco with non-tobacco ingredients. It does not include curing, baling, or packaging activities. Those who farm or grow tobacco or who handle tobacco solely for sale, shipment, or delivery to a manufacturer of tobacco products or processed tobacco are not required to obtain from TTB a permit to engage in such activities.
Nature of licensing
Automatic
If Automatic, administrative purpose
Not applicable.
Non-Automatic
If Non-Automatic, description of the notified Non-Automatic Licensing regime
Non-Automatic. See below for description.
Products under restriction as to the quantity or value of imports
The permit system does not restrict the quantity or value of imported tobacco products or processed tobacco. No alternative methods have been considered.
Questions for products under restriction as to the quantity or value of imports
Not applicable.
The system applies to products originating from which country?
All countries.
Expected duration of licensing procedure
Permits for importers of tobacco products or processed tobacco that were issued before 26 August 2013, are valid for three years from the effective date shown on the permit and may not be renewed. Permits for importers of tobacco products or processed tobacco that are issued on or after 26 August 2013, are valid for five years from the effective date shown on the permit and may be renewed for an additional five years by making application within 30 days of expiration.
Legal requirements
Is the licensing statutorily required?
The Internal Revenue Code of 1986 at 26 U.S.C. 5712 and 5713 requires that every person, prior to commencing business as a manufacturer or importer of tobacco products or processed tobacco, or as an export warehouse proprietor, qualify for and obtain a permit to engage in such business (http://www.gpo.gov/fdsys/granule/USCODE-2011-title26/USCODE-2011-title26...).
Does the legislation leave designation of products to be subject to licensing to administrative discretion?
There is no discretion for the executive branch to change the products (http://www.gpo.gov/fdsys/granule/USCODE-2011-title26/USCODE-2011-title26...) subject to the permit requirements or to abolish the permit system without legislative approval.
Is it possible for the government to abolish the system without legislative approval?
There is no discretion for the executive branch to change the products (http://www.gpo.gov/fdsys/granule/USCODE-2011-title26/USCODE-2011-title26...) subject to the permit requirements or to abolish the permit system without legislative approval.
Eligibility of applicants
Is there a system of registration of persons or firms permitted to engage in importation?
What persons or firms are eligible to apply for a licence?
Any person, firm, or institution may apply for a license. Individuals must be citizens or legal residents of the United States; firms or institutions must be incorporated in the United States and have the appropriate tax ID with the IRS.
Is there a registration fee?
There are no registration fees.
Is there a published list of authorized importers?
There is no published list of authorized importers.
Contact point for information on eligibility
Ministry/Authority
Alcohol and Tobacco Tax and Trade Bureau, U.S. Department of the Treasury
Address
1310 G St NW, Washington, DC 20005
Telephone
1-877-882-3277
Fax
Not applicable.
Contact officer
Not applicable.
Submission of an application
Administrative body(ies) for submission of an application
Alcohol and Tobacco Tax and Trade Bureau, U.S. Department of the Treasury
Documentation requirements
What information is required in applications?
Refer to TTB Form 5230.4 (http://www.ttb.gov/forms/f52304.pdf), along with such supporting documentation as required.
What documents is the importer required to supply with the application?
Refer to TTB Form 5230.4 (http://www.ttb.gov/forms/f52304.pdf), along with such supporting documentation as required.
Window of submission of an application
How far in advance of importation must application for a licence be made?
Are there any limitations as to the period of the year during which application for licence can be made? If so, explain
No.
Issuing the license
Can a licence be granted immediately on request?
No. The Internal Revenue Code of 1986 at section 5712 (26 U.S.C. 5712) sets forth the conditions for determining whether a person qualifies for a permit, and these conditions cannot be met with immediate licensing.
Can licences be obtained within a shorter time-limit or for goods arriving at the port without a licence
Permits are usually issued within six to eight months after an application has been filed.
Which administrative body is responsible for approving application of licences?
TTB has sole authority to issue the permit required under 26 U.S.C. 5712 and 5713, and therefore the importer does not have to approach any other agency in order to meet the application requirements for the permit.
Must the applications be passed on to other organs for visa, note or approval?
Are there any other conditions attached to the issue of a licence?
An application for the renewal of a permit as an importer of tobacco products or processed tobacco may be rejected and the permit denied if no activity has taken place or been reported under such permit for a period of one year immediately prior to the application for renewal. Permits may also be revoked for the reasons listed under 26 U.S.C. 5713.
Fees and other administrative charges
Is there any licensing fee or administrative charge?
Not applicable.
What is the amount of the fee or charge?
Is there any deposit or advance payment required associated with the issue of licences?
Not applicable.
Amount or rate?
Is it refundable?
What is the period of retention?
What is the purpose of this requirement?
Refusal of an application
Under what circumstances may an application for a licence be refused other than failure to meet the ordinary criteria?
There are no additional circumstances for denying an application for a permit other than what is stated in 26 U.S.C. 5712 (http://www.gpo.gov/fdsys/granule/USCODE-2011-title26/USCODE-2011-title26...).
Are the reasons for any refusal given to applicants?
The reasons for any refusal are given to the applicant in writing. .
Have applicants a right of appeal in the event of refusal to issue a licence?
An applicant may appeal the denial of a permit to the Administrator of TTB, and then to a Federal court
If so, to what bodies and under what procedures?
An applicant may appeal the denial of a permit to the Administrator of TTB, and then to a Federal court
Importation
Are there any limitations as to the period of year during which importation may be made?
No.
What documents are required upon actual importation?
Not applicable.
Are there any other administrative procedures, apart from import licensing and similar administrative procedures, required prior to importation?
TTB has no other administrative procedures, apart from permit requirements, required prior to importation.
Conditions of licensing
What is the period of validity of a licence? Can the validity be extended? How?
Permits for importers of tobacco products or processed tobacco that are issued on or after August 26, 2013, are valid for five years from the effective date shown on the permit and may be renewed for an additional five years by making application within 30 days of expiration.
Is there any penalty for the non-utilization of a licence or a portion of a licence?
No.
Are licences transferable between importers? If so, are any limitations or conditions attached to such transfer?
Permits are not transferable to another person.
Foreign Exchange
Is foreign exchange automatically provided by the banking authorities for goods to be imported?
Not applicable.
Is a licence required as a condition to obtaining foreign exchange?
Not applicable.
Is foreign exchange always available to cover licences issued?
Not applicable.
What formalities must be fulfilled for obtaining the foreign exchange?
Not applicable.