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The Tobacco Tax Amendment Act

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If you need an official copy, contact Statutory Publications.

S.M. 1995, c. 5

The Tobacco Tax Amendment Act

(Assented to June 30, 1995)

HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Manitoba, enacts as follows:

C.C.S.M. c. T80 amended

1           The Tobacco Tax Act is amended by this Act.

2            Subsection 1(1) is amended

(a) in the definition "collector", by striking out ", or deemed to be, a collector under section 9" and substituting "a collector under section 9";

(b) in the definition "dealer", by striking out everything after "by retail";

(c) by repealing the definition "extraprovincial marked product"; and

(d) by adding the following definitions in alphabetical order:

"marked for the tax purposes of Manitoba", with reference to cigarettes or fine cut tobacco, means that its packaging is marked in accordance with the regulations under clause 28(o); (« marqué à des fins fiscales pour le Manitoba »)

"packaging" means a package, case, carton or other container; (« emballage »)

"permit" means a permit issued under section 3.5; (« licence »)

"stamped for the tax purposes of Manitoba", with reference to cigarettes or fine cut tobacco, means that its packaging is stamped in accordance with the regulations under clause 28(o); (« timbré à des fins fiscales pour le Manitoba »)

"unit" means

(a) in relation to cigarettes or fine cut tobacco,

(i) 200 cigarettes, or

(ii) 400 grams of fine cut tobacco, and

(b) in relation to a tobacco product other than cigarettes or fine cut tobacco,

(i) 50 cigars, or

(ii) 400 grams of a tobacco product other than cigars; (« unité »)

3           Subsection 2(3) is amended by striking out everything after clause (b) and substituting the following:

shall report and pay tax in respect of the tobacco in accordance with the regulations.

4           Section 3 is repealed and the following is substituted:

Fraction of a cent not required to be remitted

3           When the amount to be remitted by a collector, a deputy collector or a dealer to whom subsection 9(2) applies is a specific amount plus a fraction of a cent, the collector, deputy collector or dealer is not required to remit the fraction of a cent.

5           The following is added after section 3:

PROHIBITIONS RESPECTING CIGARETTES AND FINE CUT TOBACCO

Interpretation of "person"

3.1(1)      For greater certainty, in this section "person" includes a purchaser.

Possession of cigarettes etc. not Manitoba marked

3.1(2)      No person shall be in possession of more than one unit of cigarettes or fine cut tobacco the packaging of which is not marked or stamped for the tax purposes of Manitoba.

Exception

3.1(3)      No one contravenes subsection (2) if

(a) that person establishes that he or she

(i) was authorized to collect taxes on cigarettes or fine cut tobacco for a jurisdiction outside Manitoba,

(ii) possessed the cigarettes or fine cut tobacco for the purpose of transporting it out of Manitoba for sale, and

(iii) took all reasonable steps to comply with any requirements imposed by regulation for the purpose of this clause;

(b) that person establishes that he or she

(i)  was a common carrier under contract for the transport of the cigarettes or fine cut tobacco,

(ii) had

(A) no reasonable means of knowing that the packaging of the cigarettes or fine cut tobacco was not marked or stamped for the tax purposes of Manitoba, or

(B) a reasonable belief that the cigarettes or fine cut tobacco was addressed or directed for delivery to a person who was lawfully entitled to possess it, and

(iii)  took all reasonable steps to comply with  any requirements imposed by regulation for the purpose of this clause;

(c) having been in possession of the cigarettes or fine cut tobacco in a quantity equal to or greater than six units or such other number of units prescribed by regulation for the purpose of this clause, that person establishes that he or she

(i) was the holder of a subsisting permit for the cigarettes or fine cut tobacco, and

(ii) took all reasonable steps to comply with the permit; or

(d)  having been in possession of the cigarettes or fine cut tobacco in a quantity that was more than one and fewer than six or such other number of units prescribed by regulation for the purpose of clause (c), that person establishes that he or she took all reasonable steps to comply with the regulations under clause 28(o) with respect to the stamping of the packaging of the cigarettes or fine cut tobacco for the tax purposes of Manitoba;

(e) that person establishes that he or she was a person prescribed by regulation and took all reasonable steps to comply with any requirements imposed by regulation for the purpose of this clause; or

(f) that person establishes that he or she was exempted by regulation.

Sale etc. of cigarettes etc. not Manitoba marked

3.2          No person shall, except in accordance with the regulations under clause 28(o), sell or offer to sell cigarettes or fine cut tobacco the packaging of which is not marked or stamped for the tax purposes of Manitoba.

Possession for sale of cigarettes etc. not Manitoba marked

3.3(1)      No person shall be in possession for the purpose of sale of cigarettes or fine cut tobacco the packaging of which is not marked or stamped for the tax purposes of Manitoba.Exception

3.3(2)      No one contravenes subsection (1) if that person establishes that

(a) he or she

(i)  was authorized to collect taxes on cigarettes or fine cut tobacco for a jurisdiction outside Manitoba,

(ii) possessed the cigarettes or fine cut tobacco for the purpose of transporting it out of Manitoba for sale, and

(iii) took all reasonable steps to comply with any requirements imposed by regulation for the purpose of this clause;

(b) he or she

(i) was the holder of a subsisting dealer's licence,

(ii) was the holder of a subsisting permit for the cigarettes or fine cut tobacco, and

(iii) took all reasonable steps to comply with the permit;

(c) he or she was a person prescribed by regulation and took all reasonable steps to comply with any requirements imposed by regulation for the purpose of this clause; or

(d) he or she was exempted by regulation.

Sale etc. of cigarettes etc. in stamped packaging

3.4(1)      No person, other than a person described in subsection (2), shall

(a) sell or offer to sell cigarettes or fine cut tobacco the packaging of which has been stamped for the tax purposes of Manitoba; or

(b) be in possession for the purpose of sale of cigarettes or fine cut tobacco the packaging of which has been stamped for the tax purposes of Manitoba.

Exceptions

3.4(2)      Subsection (1) does not apply to

(a) the holder of a subsisting dealer's licence if the dealer has the written approval of the director or his or her designate to sell or offer to sell the cigarettes or fine cut tobacco or to have it in his or her possession for the purpose of sale; or

(b) a person exempted by regulation.

PERMITS FOR POSSESSION OF CIGARETTES OR FINE CUT TOBACCO

Permit to possess

3.5(1)      For the purpose of subclause 3.1(3) (c)(i), subclause 3.3(2)(b)(ii) or a regulation that provides that a permit under this section may be issued, the director or his or her designate may, on application,

(a) issue a permit in the form and containing the information required by the director permitting a person to be in possession of cigarettes or fine cut tobacco the packaging of which is not marked or stamped for the tax purposes of Manitoba; and

(b) set out any conditions or restrictions in the permit that he or she considers appropriate.

Conditions

3.5(2)      Without limiting the generality of clause (1)(b), the director or his or her designate may impose a condition that the holder of the permit

(a) pay the anticipated amount of tax or account for it;

(b) provide security for tax that may be payable or may be required to be accounted for; or

(c) comply with the regulations under clause 28(o) with respect to the stamping of the packaging of cigarettes or fine cut tobacco for the tax purposes of Manitoba.

Refusal to issue permit

3.5(3)      The director or his or her designate may refuse to issue a permit to a person

(a) to whom the minister may refuse to issue a licence under section 6;

(b) who has failed to comply with a previous permit; or

(c) if the director or his or her designate has reason to believe that the cigarettes or fine cut tobacco in respect of which the application is made will be dealt with other than in accordance with this Act and the regulations.

Cancellation of permit

3.5(4)      The director or his or her designate may, by serving a notice in writing, cancel a permit for any cause for which he or she could refuse to issue a permit under subsection (3).

Service of notice

3.5(5)      A notice under subsection (4) may be served on the holder of a permit personally or by sending it by registered mail addressed to the holder at his or her address last known to the director or his or her designate, and, when served by mail, the notice is deemed to have been served on the second day following the day on which it is mailed.

PROHIBITIONS RESPECTING TOBACCO   OTHER THAN CIGARETTES OR FINE CUT TOBACCO

Possession of cigars, pipe tobacco etc.

3.6         No person shall be in possession of more than one unit of a tobacco product other than cigarettes or fine cut tobacco unless that person

(a) is a collector;

(b) acquired the tobacco product from the holder of a subsisting dealer's licence or a collector;

(c) is a common carrier under contract for the transport of the tobacco product;

(d) establishes that he or she has taken all reasonable steps to report and pay, account for or remit tax in accordance with this Act and the regulations; or

(e) is exempted by regulation.

6(1)        Subsection 4(1) is amended by striking out "sell tobacco to purchasers, or carry on business or act as a retail dealer, in the province" and substituting "within the province sell or offer to sell tobacco to purchasers, or be in possession of tobacco for sale to purchasers,".

6(2)        Subsection 4(2) is amended by striking out "shall carry on business or act as a wholesale dealer in the province," and substituting "shall within the province sell or offer to sell tobacco at wholesale, or be in possession of tobacco at wholesale,"

6(3)        Subsections 4(3), (4) and (5) are amended by adding "or offer to sell" after "sell".

6(4)        Subsection 4(6) is amended by striking out "Every dealer desiring a licence to sell tobacco" and substituting "A person who desires a dealer's licence".

7           Clause 6(a) is amended in the English version by striking out "An Act to Protect the Health of Non-Smokers" and substituting "The Non-Smokers Health Protection Act".

8(1)        Subsection 9(2) is repealed and the following is substituted:

Dealer to account for taxes etc.

9(2)        A dealer, other than a dealer exempted by regulation, who holds a subsisting dealer's licence and who

(a) is in possession of a tobacco product for the purpose of sale and on which the tax has not been accounted for; or

(b) has the immediate right to possession of a tobacco product for the purpose of sale and upon which the tax has not been accounted for;

shall report  and account for, collect or remit tax in accordance with the regulations.

8(2)        Subsections 9(3) to 9(4.1) are repealed.

8(3)        The following is added after subsection  9(5.1):

Seizure of cigarettes etc. from common carrier

9(5.2)      Where a peace officer, or a person appointed as an officer under this Act by the minister, believes on reasonable and probable grounds that cigarettes or fine cut tobacco the packaging of which is not marked or stamped for the tax purposes of Manitoba

(a) is to be found in a building, receptacle, vehicle or other place in Manitoba occupied or controlled by a common carrier;

(b) is not in the possession or apparent possession of any person other than the common carrier or an agent or employee of the common carrier acting on the common carrier's behalf; and

(c) is not addressed or directed for delivery to a person who is lawfully entitled to possess it;

and it is not practicable in the circumstances to obtain a warrant, the officer may, without warrant, enter and search the building, receptacle, vehicle or other place for the cigarettes or fine cut tobacco and may seize the cigarettes or fine cut tobacco and bring it before a justice, or report on it to a justice, to be dealt with according to law.

8(4)        Subsections 9(6) and (7) are repealed and the following is substituted:

Release of tobacco

9(6)        Tobacco or tobacco products seized under this Act, other than under subsection (5.2) or under subsection 20(2.2) or 20(2.3), may, in a quantity not greater than 20 units, be released to the person from whom they were seized if

(a) within seven days after the seizure the person pays an amount equal to three times the tax that would be imposed under section 2 if the quantity of tobacco or tobacco products were purchased by a purchaser; and

(b) when the seizure involved cigarettes or fine cut tobacco, the regulations under clause 28(o) respecting the stamping of the packaging of the cigarettes or fine cut tobacco for the tax purposes of Manitoba have been complied with;

in which case any tax payable under section 2 on the tobacco is deemed to have been paid.

Disposition of seized tobacco

9(7)        The minister may direct that tobacco or tobacco products seized under this Act but not released under subsection (6) be disposed of in accordance with the regulations or, in the absence of regulations, as the minister decides.

8(5)        The following is added after subsection 9(8):

Consequences where tobacco disposed of

9(8.1)      Where tobacco or tobacco products have been disposed of under subsection (7) and a prosecution for an alleged contravention of this Act or the regulations has been resolved,

(a) if the accused has been convicted, no person is entitled to compensation for the tobacco or tobacco products;

(b) if the prosecution has been resolved otherwise than by conviction, the person entitled to the tobacco or tobacco products is entitled to compensation

(i) if the price paid for the tobacco or tobacco products is established by the person to the satisfaction of the minister, in an amount equal to that price and interest on the amount from the time of seizure at the rate fixed by regulation, and

(ii) if the price paid for the tobacco or tobacco products is not established by the person to the satisfaction of the minister, in an amount equal to their price at the time of seizure as determined by the minister and interest on the amount from that time at the rate fixed by regulation.

8(6) Subsections 9(9) and (9.1) are repealed and the following is substituted:

Consequences where no disposition

9(9)        Where tobacco or tobacco products have not been disposed of under subsection (7) and a prosecution for an alleged contravention of this Act or the regulations has been resolved,

(a) if the accused has been convicted, the tobacco or tobacco products are forfeited to the Crown; and

(b) if the prosecution has been resolved otherwise than by conviction, the minister shall

(i) release the tobacco or tobacco products to the person entitled to them if the person has complied with this Act and the regulations with respect to payment of, accounting for or remitting of tax and, in the case of cigarettes or fine cut tobacco, the stamping of the packaging of the cigarettes or fine cut tobacco for the tax purposes of Manitoba, or

(ii) pay to the person entitled to the tobacco or tobacco products compensation

(A) if the price paid for the tobacco or tobacco products is established by the person to the satisfaction of the minister, in an amount equal to that price and interest on the amount from the time of seizure at the rate fixed by regulation, and

(B) if the price paid for the tobacco or tobacco products is not established by the person to the satisfaction of the minister, in an amount equal to their price at the time of seizure as determined by the minister and interest on the amount from that time at the rate fixed by regulation.

Application for release or compensation

9(9.1)      If, within 90 days after the resolution of a prosecution for an alleged contravention of this Act or the regulations, no person who is entitled to compensation under subsection (8.1) or (9) or to the release of the tobacco or tobacco products under subsection (9) has applied to the minister, any entitlement to compensation is extinguished and  any tobacco or tobacco products are forfeited to the Crown.

8(7)        The following is added after subsection 9(9.1):

Forfeiture of cigarettes, etc.

9(9.2)      Cigarettes or fine cut tobacco that is seized under subsection (5.2) or under subsection 20(2.2) or 20(2.3) is forfeited to the Crown and may be disposed of as the minister directs.

9           Subsection 10(7) is repealed.

10          Section 11 is amended by striking out "9" and substituting "10".

11          Subsection 14(3) is amended by striking out "or user" wherever it occurs.

12(1)       The following is added after subsection 20(2):

Preserving evidence

20(2.1)     A peace officer or a person appointed as an officer under this Act by the minister may take such measures as are reasonably necessary to secure any building or place or to secure or remove any receptacle, vehicle or thing so as to preserve evidence pending the making and disposition of an application for a warrant under subsection (2).

Warrant to seize cigarettes, etc. from common carrier

20(2.2)     A justice who is satisfied by information upon oath that there are reasonable and probable grounds to believe that cigarettes or fine cut tobacco the packaging of which is not marked or stamped for the tax purposes of Manitoba

(a) is to be found in a building, receptacle, vehicle or other place in Manitoba occupied or controlled by a common carrier;

(b) is not in the possession or apparent possession of any person other than the common carrier or an agent or employee of the common carrier acting on the common carrier's behalf; and

(c) is not addressed or directed for delivery to a person who is lawfully entitled to possess it;

may at any time issue a warrant authorizing a peace officer, or a person appointed as an officer under this Act by the minister, and such other persons as may be named in the warrant, to enter and search the building, receptacle, vehicle or other place for the cigarettes or fine cut tobacco and to seize the cigarettes or fine cut tobacco and bring it before a justice, or report on it to a justice, to be dealt with according to law.

Seizure of abandoned cigarettes etc.

20(2.3)     Where a peace officer, or a person appointed as an officer under this Act by the minister, believes on reasonable and probable grounds that cigarettes or fine cut tobacco the packaging of which is not marked or stamped for the tax purposes of Manitoba is abandoned or is not in the possession or apparent possession of any person in Manitoba, in circumstances where no person has a reasonable expectation of privacy, the officer may, without warrant, seize the cigarettes or fine cut tobacco  and bring it before a justice, or report on it to a justice, to be dealt with according to law.

12(2)       Subsection 20(4) is amended

(a) in the part preceding clause (a), by striking out ", tobacco or thing" and substituting "or thing other than tobacco";

(b) in clause (a), by striking out "send" and substituting "return" and by adding "send" before "a copy"; and

(c) in clause (b),  by striking out "or document, or the tobacco or thing," and substituting ", document or thing".

12(3)       Subsection 20(7) is amended by striking out "or document, or the tobacco or thing," and substituting ", document or thing".

13          The following is added after section 25:

EVIDENCE

Evidence by certificate

25.1        In a proceeding under this Act in which proof is required as to

(a) the existence, issue, contents, suspension or cancellation of a licence; or

(b) the existence, issue, contents or cancellation of a permit;

a certificate purporting to be signed by the director or his or her designate is admissible in evidence without proof of the signature or official character of the director or his or her designate appearing to have signed the certificate, and, in the absence of evidence to the contrary, is proof of the statements contained in the certificate.

14          The following is added after the heading "OFFENCES AND PENALTIES" and before section 26:

Marking or stamping cigarette etc. packaging

25.2(1)     No person shall, except in accordance with the regulations under clause 28(o), apply to the packaging of cigarettes or fine cut tobacco a mark or stamp to represent that the packaging of the cigarettes or fine cut tobacco is marked or stamped for the tax purposes of Manitoba.

Offences in relation to the means of marking or stamping

25.2(2)     No person shall, without lawful excuse,

(a) have in his or her possession a mark or stamp capable of being applied to the packaging of cigarettes or fine cut tobacco to represent that the packaging is marked or stamped for the tax purposes of Manitoba;

(b) have in his or her possession any instrument or machine that is designed, adjusted or modified to apply to the packaging of cigarettes or fine cut tobacco a mark or stamp to represent that the packaging is marked or stamped for the tax purposes of Manitoba; or

(c) have in his or her possession any instrument or machine that is designed, adjusted or modified to produce a mark or stamp capable of being applied to a package of cigarettes or fine cut tobacco to represent that the packaging is marked or stamped for the tax purposes of Manitoba.

15(1)       Subsection 26(1) is amended

(a) in the part preceding clause (a) by striking out "or any return" and substituting "or permit or on any return"; and

(b) by striking out the part following clause (b) and substituting the following:

and, if the offence is committed in respect of a quantity of tobacco or tobacco products, the justice shall, in addition to the penalties imposed under clause (a) or (b), order the convicted person, whether or not he or she is a purchaser, to pay to the minister an amount equal to three times the tax that would be imposed under section 2 if the quantity of tobacco or tobacco products were purchased by a purchaser.

15(2)       Subsection 26(2) is amended by striking out "subsection 9(2), (3.1), (3.3) or (3.4)" and substituting "section 3.1, 3.2, 3.3, 3.4 or 3.6, subsection  9(2) or section 25.2".

15(3)       Subsections 26(2.1) and (2.2) are repealed and the following is substituted:

Additional penalty

26(2.1)     Where an offence under section 3.1, 3.2, 3.3, 3.4 or 3.6, subsection  9(2) or section 25.2 or the regulations under clause 28(o) is committed in respect of a quantity of tobacco or tobacco products, the justice shall, in addition to the penalties imposed under subsection (2), order the convicted person, whether or not he or she is a purchaser, to pay to the minister

(a) if the person is not also convicted of an offence under the Excise Act (Canada) in respect of the same tobacco or tobacco products, an amount equal to three times the tax that would be imposed under section 2 if the quantity of tobacco or tobacco products were purchased by a purchaser;

(b) if the person is also convicted of an offence under the Excise Act (Canada) in respect of the same tobacco or tobacco products, an amount that is

(i) not less than one and not more than three times the tax that would be imposed under section 2 if the quantity of tobacco or tobacco products were purchased by a purchaser, and

(ii) not less than the difference between

(A) three times the tax that would be imposed under section 2 if the quantity of tobacco or tobacco products were purchased by a purchaser, and

(B) the penalty imposed under the Excise Act (Canada) in respect of the offence under that Act.

15(4)       Subsection 26(2.3) is repealed.

15(5)       Subsection 26(3) is amended by adding "account for," after "pay the tax or to" and "accounted for," after "tax was paid,".

15(6)       The following is added after subsection 26(3):

Presumption respecting possession for sale

26(3.1)     In a prosecution for possession of tobacco or tobacco products for the purpose of sale, proof of possession of more than 20 units of tobacco or tobacco products is, in the absence of evidence to the contrary, proof of possession of that tobacco or tobacco products for the purpose of sale.

15(7) Subsection 26(4)  is amended by adding "or permit" after "licence" wherever it occurs.

16          Section 28 is amended

(a) by adding the following after clause (a):

(a.1) defining "account for" for the purpose of this Act or the regulations or any provision of this Act or the regulations;

(b) by adding the following after clause (b):

(b.1) respecting reporting and the payment of tax for the purpose of subsection 2(3), including, without limiting the generality of the foregoing,  where and to whom reports and payments are required to be made;

(b.2) imposing requirements for the purpose of clause 3.1(3)(a) or (b) or clause 3.3(2)(a) including, without limiting the generality of the foregoing, requiring that

(i) the anticipated amount of tax be paid or accounted for,

(ii) security be provided for tax that may be payable or may be required to be accounted for, or

(iii) the regulations under clause 28(o) with respect to the stamping of the packaging of cigarettes or fine cut tobacco for the tax purposes of Manitoba be complied with;

(b.3) prescribing a number of units of cigarettes or fine cut tobacco other than six for the purpose of clause 3.1(3)(c);

(b.4) prescribing classes of persons and imposing requirements, including the requirement to hold a permit, for the purpose of clause 3.1(3)(e);

(b.5) exempting persons or classes of persons generally or in respect of certain classes of cigarettes or fine cut tobacco for the purpose of clause 3.1(3)(f);

(b.6) prescribing classes of persons and imposing requirements, including the requirement to hold a permit, for the purpose of clause 3.3(2)(c);

(b.7) exempting persons or classes of persons generally or in respect of certain classes of cigarettes or fine cut tobacco for the purpose of clause 3.3(2)(d);

(b.8) exempting persons or classes of persons for the purpose of clause 3.4(2)(b);

(b.9) exempting persons or classes of persons for the purpose of clause 3.6(e);

(c) by repealing clauses (o) and (p) and substituting the following:

(o) respecting the marking or stamping of the packaging of cigarettes or fine cut tobacco for the tax purposes of Manitoba including, without limiting the generality of the foregoing,

(i) the marking or stamping of the packaging of cigarettes or fine cut tobacco that is already marked or stamped for the tax purposes of a jurisdiction other than Manitoba, and

(ii) the stamping of the packaging of cigarettes or fine cut tobacco that is not purchased or intended to be consumed in Manitoba;

and, in relation to stamping of the packaging of cigarettes or fine cut tobacco described in subclause (ii), imposing requirements as to

(iii) reporting,

(iv) the provision of security for the ultimate removal of the cigarettes or fine cut tobacco from Manitoba, and

(v)  other similar matters;

(d) by repealing clause (q) and substituting the following:

(q) respecting reporting, and the accounting for, collecting or remitting of tax for the purpose of subsection 9(2) including, without limiting the generality of the foregoing, where and to whom reports or any accounting are required to be made or tax remitted;

(q.1) exempting dealers or classes of dealers from subsection 9(2);

(q.2) respecting the disposition of tobacco or tobacco products for the purpose of subsection 9(7);

(q.3) fixing the rate of interest for the purpose of subsections 9(8.1) and (9); and

(e) in the English version of clause (t), by striking out "prescribe" and substituting "prescribing".

17          The provisions enacted by S.M.1992, c. 52, clause 75(e), sections 77, 78 and 79, clauses 81(2)(a) and (b), subsection 81(3) and clauses 83(a), (b) and (c) are repealed.

Coming into force

18          This Act comes into force on a day fixed by proclamation.