Cal. Code Regs. Tit. 18, § 4022 - Inventories of Cigarettes

(a) Every distributor, importer, and wholesaler engaged in the sale of cigarettes shall file with the Department by the 25^th day of each calendar month a certified report and the supporting schedules required by subdivisions (c) and (d), which includes a reconciliation of the cigarettes in inventory at the end of the month covered by the report. Distributors and importers must also report the number of cigarettes contained in packages to which tax stamps are affixed and the number of cigarettes in packages not bearing tax stamps.

(b) If the distributor, importer, or wholesaler has a cycle count inventory system and perpetual inventory system in place, the monthly reconciliation shall be based on the perpetual inventory report run on the last business day of the month for which the distributor's, importer's, or wholesaler's report is filed. However, at least once every calendar year, the monthly reconciliation shall be based on a physical inventory of cigarettes on hand on the last business day of the month for which the distributor's, importer's, or wholesaler's report is filed.

A "cycle count inventory system" is a system that provides evidence that all cigarettes are counted on a regular basis, with each item being counted at least once every three-month period.

A "perpetual inventory system" is a system in which inventory records are maintained and updated continuously as items are purchased or sold.

(c) A distributor or importer engaged in the sale of cigarettes shall submit a cigarette disbursement schedule, which must contain the name and account number of the licensee filing the schedule, the month and year covered by the schedule, the schedule code for the activity being reported, and the following information regarding each cigarette disbursement:

(1) The buyer's name and federal employer identification number (FEIN);

(2) The address (street, city, state, zip code, and country) where the cigarettes were delivered;

(3) The Tax Jurisdiction Code;

(4) The name of the manufacturer of the cigarettes disbursed;

(5) The Master Settlement Agreement status of the manufacturer of the cigarettes disbursed;

(6) The brand or variant name of the cigarettes disbursed, and the corresponding Universal Product Code (UPC);

(7) The unit of measure for the UPC, for example, case, carton, pack, or sticks, and the quantity of the cigarettes disbursed as identified by the unit of measure for the UPC;

(8) The date and number of the bill of lading or other shipping documents;

(9) The total number of cigarettes disbursed;

(10) The total sales price of the cigarettes disbursed reported in U.S. dollars; and

(11) For disbursements made using a delivery service:

A. The name of the delivery service;

B. The FEIN of the delivery service;

C. The complete address and telephone number of the delivery service; and

D. The sales price, reported in U.S. dollars, of the cigarettes that were delivered.

(d) A distributor, importer, or wholesaler engaged in the sale of cigarettes shall submit a cigarette receipt schedule, which must contain the name and account number of the licensee filing the schedule, the month and year covered by the schedule, the schedule code for the activity being reported, and the following information regarding each receipt of cigarettes:

(1) The seller's name and FEIN;

(2) The complete address, including country, from which the product originated;

(3) The Tax Jurisdiction Code;

(4) The name of the manufacturer of the cigarettes received;

(5) The Master Settlement Agreement status of the manufacturer of the cigarettes received;

(6) The brand or variant name of the cigarettes received, and the corresponding UPC;

(7) The unit of measure for the UPC, for example, case, carton, pack, or sticks, and the quantity of the cigarettes received as identified by the unit of measure for the UPC;

(8) The date and number of the bill of lading or other shipping document; and

(9) The total number of cigarettes received.

Notes

Cal. Code Regs. Tit. 18, § 4022

1. Amendment filed 10-10-68; designated effective 11-13-68 (Register 68, No. 38).
2. Repealer and new section and new NOTE filed 1-16-2002; operative 2-15-2002 (Register 2002, No. 3).
3. Amendment of section and NOTE filed 12-27-2021; operative 12-27-2021. Submitted to OAL for filing and printing only pursuant to Government Code section 15570.40(b) (Register 2021, No. 53).

Note: Authority cited: Sections 15570.22 and 15570.24, Government Code; and Section 30451, Revenue and Taxation Code. Reference: Sections 30182, 30188, 30453 and 30454, Revenue and Taxation Code.

1. Amendment filed 10-10-68; designated effective 11-13-68 (Register 68, No. 38).
2. Repealer and new section and new Note filed 1-16-2002; operative 2-15-2002 (Register 2002, No. 3).
3. Amendment of section and Note filed 12-27-2021; operative 12/27/2021. Submitted to OAL for filing and printing only pursuant to Government Code section 15570.40(b) (Register 2021, No. 53).