Tobacco Product Taxation and Licensing

Del. Code tit. 30, ch. 53
in effect

Del. Code tit. 30, § 5301 Definitions.

As used in this chapter: (1) “Affixing agent” means any tobacco products dealer or any other person within or without this State appointed by the Department of Finance as an agent to affix the stamps to be used in paying the excise tax imposed by this chapter. The first vendor who has possession of unstamped tobacco products in this State for sale in this State is deemed an affixing agent. (2) “Cigar” means any roll for smoking which is not a cigarette and which is made wholly or in part of tobacco or any substitute therefor when the cover of the roll is made chiefly of tobacco. (3) “Cigarette” means any roll for smoking made wholly or in part of tobacco, irrespective of size or shape, and irrespective of the tobacco being flavored, adulterated, or mixed with any other ingredient, the wrapper or cover of which is made of paper or any other substance or material except tobacco. (4) “Consumer” means any person who has possession of tobacco products for any purpose other than transportation or sale. (5) “Department of Finance” or "Department" means the Department of Finance. (6) “Distributor” means any of the following: a. Any person engaged in the business of selling tobacco products in this State who brings or causes to be brought into this State from without the State any tobacco products for sale. b. Any person who makes, manufactures, or fabricates tobacco products in this State for sale in this State. c. Any person engaged in the business of selling tobacco products without this State who ships or transports tobacco products to retail dealers in this State to be sold by those retail dealers. (7) “Electronic smoking device” means a nonlighted, noncombustible device that employs a mechanical heating element, battery, or circuit, regardless of shape or size, to produce aerosolized or vaporized nicotine for inhalation into the body of an individual. “Electronic smoking device” includes a device that is manufactured, distributed, marketed, or sold as an e-cigarette, e-cigar, e-pipe, e-hookah, vape pen, or any other similar product with any other product name or descriptor. (8) “Moist snuff” means any finely cut, ground, or powdered tobacco that is not intended to be smoked, but does not include any finely cut, ground, or powdered tobacco that is intended to be placed in the nasal cavity. (9) “Package” or “pack” means, as to cigars, the smallest individual container which contains more than 1 cigar in or from which retail sales are normally made or intended to be made, and means, as to other tobacco products, the smallest individual container in or from which retail sales of such products are normally made or intended to be made. (10) “Place of business” means any place where tobacco products are sold, or where tobacco products are bought or kept for the purpose of sale or consumption, including, so far as applicable, any vessel, airplane, train, or vending machine dispensing tobacco products. (11) “Retail dealer” means any person who purchases or receives stamped tobacco products from any source whatsoever for the purpose of sale to the ultimate consumer. (12) “Sale” means in addition to its usual meaning, any sale, transfer, exchange, theft, barter, gift, or offer for sale and distribution, in any manner or by any means whatsoever. (13) “Secretary of Finance” or “Secretary” means the Secretary of Finance or the Secretary's duly authorized designee; provided, that any such delegation of authority is consistent with Chapter 83 of Title 29. (14) “Smokeless tobacco products” means all products, other than moist snuff, made primarily of tobacco for individual consumption, not intended to be smoked. (15) “Tobacco products” means all products made primarily from tobacco for individual consumption, including cigarettes, cigars, pipe tobacco, and vapor products. (16) “Tobacco product tax stamps” means any adhesive stamps, tax meter impression, or other stamps, labels, or prints authorized by the Department of Finance to evidence the payment of the tax imposed by this chapter. (17) “Tobacco product vending machine” means any mechanical device from which tobacco products are dispensed for a consideration. (18) “Unstamped tobacco products” means any pack or package of tobacco products to which the proper amount of genuine Delaware tobacco product tax stamps has not been affixed. (19) “Use” means the exercise of any right or power over tobacco products including the retention for any length of time for any purpose other than sale or transportation as allowed under the provisions of this chapter. (20) “Vapor product” means any nicotine liquid solution or other material containing nicotine that is intended to be used with or in an electronic smoking device. (21) “Vending machine operator” means any person who places 1 or more vending machines, owned, leased or operated by the person, at locations where tobacco products are sold therefrom. The owner or lessee of the premises upon which a vending machine is placed shall not be considered the operator of the machine, if the owner or lessee does not own or lease the machine and if the sole remuneration therefrom is a flat rental fee or a commission, based upon the number or value of tobacco products sold from the machine, or a combination of both. (22) “Wholesale dealer” means any person who regularly sells tobacco products within this State to others who buy for the purpose of resale. (23) “Wholesale price” means the price for which a manufacturer sells a tobacco product to a distributor exclusive of any discount, rebate, or other reduction.

Del. Code tit. 30, § 5305 Levy of tax, limitation; exemption [For application of this section, see 81 Del. Laws, c. 55, § 28(a)]

(a) An excise tax is imposed and assessed upon the sale or use of cigarettes within this State at the rate of 105 mills per cigarette. This tax applies only once to the same pack of cigarettes. In the event the tax computed according to this subsection results in a tax per pack or other unit of sale to which this tax applies involving a fraction of a cent, the tax applicable to that pack or other unit must be computed by rounding the tax to the next higher whole cent. (b) A tax is imposed and assessed upon the sale or use of all tobacco products, except those tobacco products taxed under subsection (a) or (c) of this section, within this State at the rate of 30% of the wholesale price on such products. (c) (1) A tax is imposed and assessed upon the sale or use of moist snuff within this State at the rate of 92 cents per ounce and a proportionate tax at the like rate on any fractional parts of an ounce. The per ounce tax imposed under this subsection must be computed based on the net weight as listed by the manufacturer. (2) An excise tax is imposed and assessed upon the sale or use of vapor products within this State at the rate of 5 cents per fluid milliliter of vapor product. The tax imposed by this paragraph (c)(2) of this section must be computed based on the amount of vapor product in milliliters as listed by the manufacturer. All invoices for vapor products issued by a manufacturer must state the amount of vapor product in milliliters. (d) No tax imposed by this chapter may be levied upon the possession or sale of tobacco products which this State is prohibited from taxing under the Constitution or statutes of the United States. (e) If the seller and purchaser have registered with the Department and obtained exemption certificates, the following sales are exempt: (1) Sales to veterans’ organizations approved by the Department, if the tobacco products are being purchased by the organization for gratuitous issue to veteran patients in federal, state, or state-aided hospitals; (2) Sales to patients in Veterans’ Administration Hospitals by retail dealers located in such hospitals. (f) [Transferred definitions for “cigar” and “wholesale price”, appearing in former (f)(1) and (2), to § 5301 of this title.]

Del. Code tit. 30, § 5306 Liability for payment of tax.

The tax must be paid and the stamp must be affixed by the first person who has possession of tobacco products in this State.

Del. Code tit. 30, § 5307 License for sales of tobacco products.

A person may not engage in or conduct the business of manufacturing, purchasing, selling, consigning, or distributing tobacco products in this State or acting as an affixing agent without having first obtained the appropriate license for that purpose as prescribed by this chapter.

Del. Code tit. 30, § 5308 License charges.

(a) Wholesale license. — For each wholesale license issued there must be paid to the Department of Finance a fee of $200. If a holder of a wholesale license sells or intends to sell tobacco products at 2 or more places of business, whether established or temporary, a separate license is required for each place of business. (b) Retail license. — For each retail license there must be paid to the Department of Finance a fee of $50. If a holder of a retail license sells or intends to sell tobacco products at 2 or more places of business, whether established or temporary, or whether in the same building or not, a separate license is required for each place of business. (c) Vending machine license. — Every vending machine from which tobacco products are offered for sale must have affixed to it an identification stamp issued by the Department of Finance for which a fee of $15 must be paid to the Department. If 2 or more vending machines are fastened together, each set of mechanisms must have a separate vending machine license. (d) Affixing agent license. — For each affixing agent’s license issued there must be paid to the Department of Finance a fee of $200, but only 1 license fee of $200 is required of any person who is both a wholesale dealer and an affixing agent.

Del. Code tit. 30, § 5309 Application for license.

(a) Every person desiring to engage in the sale of tobacco products at wholesale, retail, or by tobacco product vending machines within this State, except those persons who are exempt under § 5305(d) of this title, and every person desiring to become an affixing agent shall file an application for a license with the Department of Finance. (1) Every application for a tobacco product license must be made upon a form prescribed, prepared, and furnished by the Department and must set forth the name under which the applicant transacts or intends to transact business; the location of the applicant’s place of business, whether within or without the State; whether or not the applicant is the holder of a mercantile or business license in effect when the application is made and, if so, the number of such license and the county for which such license was issued; and such other information as the Department may require. (2) If the applicant has or intends to have more than 1 place of business within the State, the application must state the location of each place of business. (3) If the applicant is an association, the application must set forth the names and addresses of the persons constituting the association; and if a corporation, the names and addresses of the principal officers thereof and any other information prescribed by the Department for purposes of identification. (4) The application must be signed and verified by oath or affirmation by the owner, if a natural person, and, in the case of an association, by a member or partner thereof and, in the case of a corporation, by an executive officer thereof, or some person specifically authorized to sign the application, to which must be attached the written evidence of such person’s authority. (b) A single application may be filed for more than 1 license. The operator of tobacco product vending machines shall list all locations at which the operator has machines at the time of the application. The operator may also request extra licenses for new machines to be placed in new locations up to 10% of the listed locations on file with the Department without submitting actual locations. As the new machines are placed on location for sale of tobacco products, the operator shall immediately notify the Department and the operator shall become eligible to apply for licenses for an additional 10% of the operator’s new totals. Failure to notify the Department when and where new machines are placed in operation is cause for suspension and seizure of all licenses and tobacco product vending machines.

Del. Code tit. 30, § 5310 Issuance of licenses; display.

Upon approval of the application and payment of the fees, the Department shall issue the proper licenses for each place of business set forth in the application. Every license shall be conspicuously displayed at the place for which issued.

Del. Code tit. 30, § 5311 Expiration of licenses.

Every license shall expire on December 31 next succeeding the date upon which it was issued, unless sooner suspended, surrendered, revoked or renewed.

Del. Code tit. 30, § 5312 Replacement of licenses.

Whenever any license issued under this chapter is defaced, destroyed, or lost, the Department of Finance may issue a duplicate to the holder of the defaced, destroyed, or lost license upon the payment of a fee of $10 by the holder.

Del. Code tit. 30, § 5313 Suspension or revocation of license.

The Department of Finance, after a hearing before the Secretary of Finance, may suspend or revoke a license issued pursuant to this chapter whenever it finds that the holder thereof has failed to comply with any of the provisions of this chapter or any regulations of the Department adopted pursuant to § 5329 of this title. Whenever the Department intends to suspend a license for any violation under this chapter, it shall immediately notify the holder in writing, stating the violations charged and giving the licensee the right of a hearing before the Secretary of Finance within 5 days after receipt of such written notice. After such hearing, the Department shall either rescind the notice of the suspension, enforce the suspension or revoke the license. Upon the suspension or revocation of any license, the holder thereof shall forthwith surrender all licenses to the Department issued to the holder under this chapter and no refund of fees shall be paid.

Del. Code tit. 30, § 5314 Transfer of license.

Any licensed dealer may transfer a license from 1 location to another or from 1 tobacco product vending machine to another in accordance with the rules and regulations of the Department.

Del. Code tit. 30, § 5315 Tobacco product tax stamps; affixing; amount; cancellation.

(a) Within the time prescribed, every authorized affixing agent shall affix to each pack of tobacco products received by the agent and shall cancel Delaware tobacco product tax stamps to evidence payment of the tax imposed by this chapter, unless such stamps have been affixed to the packs of tobacco products and cancelled before such authorized affixing agent received them. (b) Stamps in an amount not less than the tax thereon must be affixed to each pack of tobacco products in such manner that they will be visible to the purchaser. The authorized affixing agent, affixing such stamps, shall cancel them immediately in such manner as may be prescribed by the Department.

Del. Code tit. 30, § 5316 Design and sale of stamps.

(a) Delaware tobacco product tax stamps must be adhesive stamps, tax meter impressions, or other stamps, labels, or prints of such designs and denominations as may be prescribed by the Department. (b) (1) The Department shall make provisions for the sale of Delaware tobacco product tax stamps in such places and at such times as it deems necessary. (2) All stamps must be paid for at the time of purchase. (3) Notwithstanding paragraph (b)(2) of this section, an authorized affixing agent may enter into an agreement with the Department of Finance providing for deferred payment for tobacco product stamps or for amounts added to tobacco product tax meters during a month to a date not later than 30 days from the date of purchase or addition to a tobacco product tax meter if the affixing agent furnishes a bond to assure payment in such amount as required by the Secretary of Finance, and pays all amounts due for the month of June by June 25. (4) A person may not purchase tobacco product stamps from any person other than the Department of Finance or its authorized agents, except in accordance with the Finance Department’s regulations relating to the stamping of floor stock.

Del. Code tit. 30, § 5317 Time for affixing stamps; reporting requirements; violation.

(a) The authorized affixing agent shall affix the required amount of Delaware tobacco product tax stamps to unstamped tobacco products within 72 hours after receipt of the tobacco products and prior to the sale of the tobacco products, unless the tobacco products are exempt by other provisions of this chapter. Whenever any tobacco products are found in the place of business of the authorized affixing agent without the stamps affixed as provided by this subsection, or not segregated or marked as having been received within the preceding 72 hours, or not segregated or marked as exempt from requirement of Delaware tobacco product tax stamp under other provisions of this chapter, a prima facie presumption arises that such tobacco products are possessed in violation of this chapter. (b) Between noon local time and midnight on each July 31 and December 31, an affixing agent may not have in its possession cigarettes without the stamps affixed as provided under subsection (a) of this section or not segregated or marked as exempt from the requirement of Delaware tobacco product tax stamps. The affixing agent shall accurately report to the Director of Revenue the quantity of cigarettes bearing stamps and the balance remaining in any device used for affixation of stamps at that time. Failure to comply with this subsection is prima facie cause for suspension or revocation of licenses under § 5313 of this title.

Del. Code tit. 30, § 5318 Appointment of stamp affixing agents; commission.

(a) The Department may appoint any manufacturer of tobacco products or wholesaler within this State and may appoint any other person within or without this State as its agent to affix Delaware tobacco product tax stamps. Tax affixing agents located outside the State must apply the stamps to all taxable tobacco products before bringing them into this State. (b) Whenever the Department shall sell, consign, or deliver Delaware tobacco product tax stamps to any authorized stamp affixing agent, such agent is entitled to receive as compensation for such agent’s services and expenses a commission at the rate of 3/10 of 1 cent for affixing the tax stamp to each package of 20 or more cigarettes. The commission is to be retained out of the moneys to be paid by such agent for such stamps purchased from the Department.

Del. Code tit. 30, § 5319 Alternate method of collection; other tobacco products.

If in the judgment of the Department the collection of the excise tax imposed in § 5305 of this title upon tobacco products other than cigarettes will be more efficiently and economically collected by a system which does not employ tax stamps as authorized by this chapter, such alternative system may be utilized by the Department at its discretion. The alternative system may include self-assessment by any wholesale or retail tobacco products dealer on forms supplied by the Department. If instituted, the alternative collection system shall be set forth in the rules and regulations of the Department, which shall be distributed to all affected dealers at least 90 days in advance of the effective date of such rules and regulations.

Del. Code tit. 30, § 5321 Duties imposed on licensed tobacco products dealers; lists.

(a) A licensed tobacco products dealer may not sell tobacco products or purchase tobacco products from any person required to be licensed who is not so licensed or is improperly licensed; except that a licensed wholesale tobacco products dealer may sell tax paid tobacco products to a tobacco products manufacturer’s representative if the manufacturer’s representative presents valid proof that the representative is a bona fide sales representative of the tobacco products manufacturer. (b) All holders of wholesale licenses shall maintain at every licensed location a list of the names and license numbers or holders of wholesale and retail licenses to whom tobacco products are sold or delivered. (c) A licensed tobacco products dealer may not sell smokeless tobacco products unless the package for such smokeless tobacco product bears a legible legend required by any federal law, rule, or regulation relating to the possible hazard involved in use of the product.

Del. Code tit. 30, § 5322 Duties imposed on manufacturer’s representatives.

A tobacco products manufacturer’s representative may sell only to a licensed tobacco products dealer, unless the representative obtains a dealer’s license under this chapter and the rules and regulations promulgated under this chapter. A manufacturer’s representative who participates in promotional activities involving the sale of tobacco products to persons other than licensees is presumed to be acting as an agent of the licensee who furnished the tobacco products.

Del. Code tit. 30, § 5324 Sample packs.

The Department shall promulgate regulations governing the receipt, distribution of, and the payment of tax on, sample packs of tobacco products used for free distribution. The regulations may provide that any licensed dealer may receive and make free distribution of sample packs of tobacco products without affixing Delaware tobacco product tax stamps thereto, so long as the proper tax thereon has been paid.

Del. Code tit. 30, § 5325 Late filing penalty.

Every stamp affixing agent shall file with the Department, on or before the twentieth day of each month, a report in such form as the Secretary of Finance shall prescribe. The report must disclose the number of tobacco products on hand on the first and last days of the calendar month immediately preceding the month in which such report is required, together with such information concerning the amount of stamps purchased, used and on hand during the report period, together with any other information for the report period that the Secretary of Finance shall prescribe. Any tax affixing agent who fails to file any report on the day when it is due shall forfeit, as a penalty for each day thereafter until the report is filed, the sum of $15 to be collected in the manner provided in this chapter for the collection of penalties. The Secretary of Finance, if satisfied that the failure to comply with this section was excusable, may remit the whole or any part of said penalty.

Del. Code tit. 30, § 5326 Refunds.

Whenever any packs of tobacco products upon which stamps have been placed have been sold and shipped into another state for sale or use therein, or have been sold to persons exempt under § 5305(d) of this title for resale to authorized purchasers, or have been returned to the manufacturer for credit because they became unfit for use and consumption or became unsalable by reason of fire, flood, or other causes beyond the control of the person who sold the tobacco products and shipped them into another state for sale or for use therein or who sold the tobacco products to persons exempt under § 5305(d) of this title for resale to authorized purchasers or who owned the tobacco products at the time they were returned to manufacturer because they became unfit for use and consumption or unsalable by reason of fire, flood, or other cause beyond the control of the person seeking the refund shall be entitled to a refund of the actual amount of tobacco product tax paid with respect to such tobacco products. If the Department is satisfied that a refund is proper, it shall certify the proposed amount of refund and thereafter shall issue to the person seeking the refund stamps or cash of sufficient value to cover the refund.

Del. Code tit. 30, § 5327 Exempt sales.

The Department may promulgate regulations to relieve authorized affixing agents from affixing stamps to packs of tobacco products to be sold and delivered to points outside the State for use outside the State, or to be sold to purchasers designated as exempt under § 5305(d) of this title for resale to authorized purchasers. However, all sales are presumed to be taxable and the burden is upon the person claiming an exemption to prove such person’s right to the exemption.

Del. Code tit. 30, § 5328 Invoices or delivery tickets and purchase orders required in certain cases.

(a) A person who possesses or transports 10 or more packs or packages, or an equivalent amount unpackaged, of unstamped tobacco products upon the public highways, roads, or streets of this State for the purpose of delivery, sale, or disposition is required to have in the person’s possession invoices or delivery tickets and purchase orders for the tobacco products which must show all of the following: (1) The true name and complete and exact address of the consignor or seller. (2) The true name and complete and exact address of the person transporting the tobacco products. (3) The quantity and brand of the tobacco products transported and the true name and complete and exact address of the person who has been licensed to assume the payment of the Delaware tax or the tax, if any, of the state or foreign country at the point of ultimate destination. (b) Notwithstanding subsection (a) of this section, any common carrier which has issued a bill of lading for shipment of tobacco products and is without notice to itself or to any of its agents or employees that the tobacco products are not stamped as required by this chapter is deemed to have complied with this chapter. (c) The absence of proper invoices or delivery tickets and purchase orders required under this section is prima facie evidence that the person is in violation of this chapter and subject to the penalties of this chapter.

Del. Code tit. 30, § 5329 Administration by Department; rules and regulations.

The administration, enforcement and collection of all taxes, permits, licenses and fees under this chapter are vested in the Department of Finance and the Secretary of Finance of the State, and the powers conferred upon the Department and the Secretary of Finance under Chapter 3 of this title shall, so far as applicable, be exercisable with respect to the provisions of this chapter. The Department may prescribe, adopt, promulgate and enforce rules and regulations relating thereto, including: (1) The method and means to be used in the cancellation of stamps; (2) The denominations and sale of stamps; (3) The time and manner of filing reports; (4) Any other matter or thing pertaining to the administration and enforcement of this chapter.

Del. Code tit. 30, § 5330 Bonds.

The Secretary, at the Secretary’s discretion, in order to protect the revenues to be obtained under this chapter, may require any person liable for the payment of a tax imposed under this chapter to furnish a bond executed by a surety company authorized to do business in this State and approved by the State Insurance Commissioner as to solvency and responsibility, in such amounts as the Secretary may fix, to secure the payment of any tax and interest or penalties due or which may become due from the person. (1) If the Secretary determines that a person must file a bond, the Secretary shall give notice to such person to that effect, specifying the amount of the bond required. (2) The bond must be filed 5 days after the giving of notice under paragraph (1) of this section, unless within 5 days of such notice a request in writing for a hearing before the Secretary of Finance is made. (3) At a hearing held under paragraph (2) of this section, the Secretary of Finance shall review and determine the necessity, propriety, and amount of the bond. (4) The Secretary’s determination is final and the person requesting the hearing must comply with the determination within 15 days after notice of the determination is sent by the Secretary to the person requesting the hearing.

Del. Code tit. 30, § 5341 Sale of unstamped tobacco products; refusal to permit inspection; counterfeited or reused stamps; penalty.

(a) A person may not sell any pack of tobacco products that does not have affixed to it the proper amount of Delaware tobacco product tax stamps. (b) A dealer may not refuse to permit the Department to examine such dealer’s books and records, stock of tobacco products, or premises and equipment in order to verify the accuracy of the tax payments imposed by this chapter. (c) A person may not falsely or fraudulently make, forge, alter, or counterfeit any stamp prescribed by the Department under this chapter; or cause or procure a stamp to be falsely or fraudulently made, forged, altered, or counterfeited; or knowingly and wilfully utter, publish, pass, or tender as true a false, altered, forged, or counterfeited stamp; or use more than once any stamp provided for and required by this chapter for the purpose of evading the tax hereby imposed and assessed. (d) A person who violates this section may be fined not more than $1,000, or imprisoned for not more than 1 year, or both.

Del. Code tit. 30, § 5342 Possession of untaxed tobacco products.

(a) Except as authorized by this chapter, a person who is not an affixing agent or does not hold a valid, unexpired exemption certificate may not possess within this State 10 or more packs or packages, or an equivalent unpackaged amount of tobacco products upon which the Delaware tobacco product tax has not been paid, or to which Delaware tobacco product tax stamps are not affixed in the amount required. (b) Whenever any tobacco products are found at the place of business of a dealer, whether a stamp affixing agent or not, and the tobacco products do not have the proper amount of stamps affixed and cancelled, or it is determined that the Delaware tobacco product tax has not been paid on such tobacco products, and the boxes, cartons, or other containers have not been marked as having been received within 72 hours, such dealer may be fined not less than $100 nor more than $1,000, or imprisoned not more than 90 days, or both. (c) Notwithstanding the provisions of subsection (b) of this section, any violation of § 5317(b) of this title is punishable as a violation of subsection (b) of this section, except that the Superior Court in and for the county in which any element of the offense occurred has exclusive original jurisdiction over offenses under this subsection.

Del. Code tit. 30, § 5343 Penalties not specifically provided for.

Whoever violates any provision of this chapter for which a specific penalty is not otherwise provided, and whoever violates any regulation promulgated pursuant to this chapter, shall be fined not less than $100 nor more than $1,000, or imprisoned not more than 90 days, or both.

Del. Code tit. 30, § 5344 Liability joint and several as between owner and operator.

Whenever a duty or liability is imposed under this chapter on the owner or operator of tobacco product vending machines, the owner and operator is jointly and severally liable for the performance of such duty or satisfaction of such liability.

Del. Code tit. 30, § 5345 Police powers; arrests.

(a) Employees of the Department of Finance who are designated “tobacco product tax-enforcement officers” are peace officers and have the same police power and authority as constables throughout the State. (b) Such officers may arrest on view, except in private homes, without warrant, any person actually engaged in the unlawful sale of unstamped tobacco products, or unlawfully having in such person’s possession unstamped tobacco products, contrary to this chapter.

Del. Code tit. 30, § 5346 Prohibitions.

(a) No tobacco product tax stamp may be affixed to or made upon any package of cigarettes if: (1) The package differs in any respect with the requirements of the Federal Cigarette Labeling and Advertising Act for the placement of labels, warnings or any other information upon a package of cigarettes that is to be sold within the United States; (2) The package is labeled “For Export Only,” “U.S. Tax Exempt,” “For Use Outside U.S.,” or similar wording indicating that the manufacturer did not intend that the product be sold in the United States; (3) The package, or a package containing individually stamped packages, has been altered by adding or deleting the wording, labels or warnings described in paragraph (a)(1) or (2) of this section, including by the placement of a sticker on such package; (4) Any person with respect to the cigarettes in such package is not in compliance with 15 U.S.C. § 1335a (relating to the submission of ingredient information to federal authorities); (5) The package has been imported into the United States after January 1, 2000, in violation of 26 U.S.C. § 5754 or 19 U.S.C. §§ 1681 through 1681b; or (6) The package in any way violates federal trademark or copyright laws or any law of this State. (b) Any person who sells, acquires, holds, owns or possesses for sale or distribution in this State a cigarette package to which is affixed a tax stamp in violation of subsection (a) of this section shall be fined not more than $1,000 or imprisoned for not more than 1 year, or both. Each cigarette package sold or held for sale shall be a separate violation. (c) Notwithstanding any other provision of law, the Secretary may revoke any license issued under this chapter to any person who sell or holds for sale a cigarette package to which is affixed a tobacco product tax stamp in violation of subsection (a) of this section. (d) Notwithstanding any other provision of law, the Secretary shall seize and destroy packages that do not comply with subsection (a) of this section. (e) Notwithstanding any other provision of law, a violation of subsection (a) of this section is a deceptive practice under the Uniform Deceptive Trade Practices Act (subchapter III of Chapter 25 of Title 6).

Del. Code tit. 30, § 5351 Forfeiture of tobacco products; disposal.

(a) In the event of a conviction under § 5342 of this title, the tobacco products which were the subject of the violation are automatically forfeited to the State. (b) The Department shall destroy any tobacco products forfeited under this section. The Department may, prior to the destruction of any tobacco products, permit the true holder of the trademark rights in the tobacco product brand to inspect such forfeited tobacco products in order to assist the Department in any investigation regarding such tobacco products.

Del. Code tit. 30, § 5352 Forfeiture of vehicle used in illegally transporting tobacco products.

Any vehicle used in the transporting of tobacco products in violation of this chapter is subject to the provisions of subchapter II of Chapter 23 of Title 11.

Del. Code tit. 30, § 5353 Tobacco product vending machine forfeiture proceedings.

(a) The proceedings for the forfeiture of any tobacco product vending machine in which are found untaxed tobacco products shall be in rem. The State shall be the plaintiff and the property the defendant. A petition shall be filed in the Superior Court of the county in which the machine was found, verified by the oath or affirmation of any tobacco product tax-enforcement officer or other person. The petition shall contain the following: (1) A description of the machine seized; (2) A statement of the time when and place where seized; (3) The name and address of the owner, if known; (4) The name and address of the person in possession, if known; (5) A statement of the circumstances under which the machine was found and the number and a description of the unstamped tobacco products found therein; and (6) A prayer for an order forfeiting the machine to the State, unless cause be shown to the contrary. (b) A copy of the petition shall be served personally on the owner if the owner can be found within the State, or upon the person in possession at the time of the seizure. The copy shall have endorsed thereon a notice substantially similar to the following: “To the claimant of the within tobacco product vending machine: You are required to file an answer to this petition setting forth your title in, and right to possession of, said machine within 20 days from the service hereof, and you are also notified that if you fail to file said answer, a decree of forfeiture will be entered against said machine.” This notice shall be signed by the Secretary of Finance or the Attorney General or a Deputy Attorney General. (c) If the owner of the machine is unknown or outside the State, and there was no person in possession of the machine when seized, or the person in possession cannot be found within the State, a copy of the petition shall be sent by registered or certified mail, return receipt requested, to the person’s last known address, if any, and notice of the petition shall also be given by an advertisement in 1 newspaper of general circulation published in the county where the machine was seized, once a week for 2 successive weeks. No other advertisement of any sort shall be necessary, any other law to the contrary notwithstanding. The notice shall contain a statement of the seizure of the machine with a description thereof, the place and date of seizure and shall direct any claimants thereof to file a claim therefor, on or before a date given in the notice, which shall not be less than 10 days from the date of the last publication. (d) Thirty days after the filing of any claim for the machine setting forth a right of possession thereof, the case shall be deemed at issue and a time shall be fixed for the hearing thereof. (e) At the time of the hearing, if the State shall produce evidence that the machine in question was found to contain unstamped tobacco products, the burden shall be upon the claimant to show: (1) That the claimant is the owner of the machine and (2) That all tobacco products found in the machine at the time of seizure did contain the proper amounts of Delaware tobacco product tax stamps. (f) In the event the claimant shall prove by competent evidence, to the satisfaction of the Court, that the machine did not contain unstamped tobacco products, the Court shall order the machine returned to the claimant, otherwise the Court shall order it forfeited to the State.

Del. Code tit. 30, § 5354 Seizure of untaxed tobacco products and tobacco product vending machines.

Whenever any law-enforcement officer, the Department or its agents have reasonable grounds to believe that any untaxed tobacco products are unlawfully in the State or that a vending machine is being used to hold untaxed tobacco products, they may seize such tobacco products or tobacco product vending machines and hold them in custody pending a decision of the Court. No tobacco products or tobacco product vending machines being held in custody shall be seized or taken therefrom on any writ of replevin or like judicial process.

Del. Code tit. 30, § 5361 Definitions.

For purposes of this subchapter: (1) “Adult” means a person who is at least the legal minimum purchase age. (2) “Consumer” means an individual who is not licensed as a distributor or retail dealer pursuant to subchapter II of this chapter. (3) “Delivery sale” means any sale of any tobacco product or tobacco substitute to a consumer in this State where either: a. The purchaser submits the order for such sale by means of a telephonic or other method of voice transmission, the mails or any other delivery service, or the Internet or other online service; or b. The tobacco products or tobacco substitutes are delivered by use of the mails or of a delivery service. A sale of any tobacco product or tobacco substitute shall be a delivery sale regardless of whether the seller is located within or without this State. A sale of any tobacco product or tobacco substitute not for personal consumption to a person who is a distributor or a retail dealer shall not be a delivery sale. (4) “Delivery service” means any person who is engaged in the commercial delivery of letters, packages or other containers. (5) “Department” means the Department of Finance. (6) “Legal minimum purchase age” is the minimum age at which an individual may legally purchase any tobacco product or tobacco substitute in this State under § 1116 of Title 11. (7) “Mails” or “mailing” means the shipment of cigarettes through the United States Postal Office. (8) “Person” means the same as that term is defined in § 302(15) of Title 1. (9) “Shipping container” means a container in which cigarettes are shipped in connection with a delivery sale. (10) “Shipping documents” means bills of lading, airbills or any other documents used to evidence the undertaking by a delivery service to deliver letters, packages or other containers. (11) “Tobacco product” means as defined under § 1115(9)a. of Title 11. (12) “Tobacco substitute” means as defined under § 1115 of Title 11.

Del. Code tit. 30, § 5362 Requirements for delivery sales.

(a) No person shall make a delivery sale of any tobacco product or tobacco substitute to any individual who is under the legal minimum purchase age in this State. (b) Each person accepting a purchase order for a delivery sale shall comply with: (1) The age verification requirements set forth in § 5363 of this title; (2) The disclosure requirements set forth in § 5364 of this title; (3) The shipping requirements set forth in § 5365 of this title; (4) The registration and reporting requirements set forth in § 5366 of this title; (5) The tax collection requirements set forth in § 5367 of this title; and (6) All other laws of this State generally applicable to sales of any tobacco product or tobacco substitute that occur entirely within this State, including, but not limited to, those laws imposing: a. Excise taxes; b. Sales taxes; c. License and revenue-stamping requirements; and d. Escrow payment obligations as set forth in § 6082 of Title 29.

Del. Code tit. 30, § 5363 Age verification requirements.

(a) No person shall mail, ship or otherwise deliver any tobacco product or tobacco substitute in connection with a delivery sale unless prior to the first delivery sale to such consumer: (1) Receives both a copy of a valid form of government identification showing date of birth to verify the purchaser is age 21 years or over and an attestation from the purchaser certifying that the information on the government identification truly and correctly identifies the purchaser and the purchaser’s current address. Such attestation shall also confirm: a. That the prospective consumer understands that signing another person’s name to such certification is illegal; b. That the sale of tobacco products, including cigarettes, or tobacco substitutes to individuals under the legal minimum purchase age is illegal; and c. That the purchase of tobacco products, including cigarettes, or tobacco substitutes by individuals under the legal minimum purchase age is illegal under the laws of this State; (2) Delivers the tobacco product or tobacco substitute to the address of the purchaser given on the valid form of government identification and by a postal or package delivery service method that either limits delivery to that purchaser and requires the purchaser to sign personally to receive the delivery or requires a signature of an adult at the purchaser’s address to deliver the package; (3) Provides to the prospective consumer, via e-mail or other means, a notice that meets the requirements of § 5364 of this title; and (4) In the case of an order for any tobacco product or tobacco substitute pursuant to an advertisement on the Internet, receives payment for the delivery sale from the prospective consumer by a credit or debit card that has been issued in such consumer’s name. (b) Persons accepting purchase orders for delivery sales may request that prospective consumers provide their e-mail addresses. (c) Any wholesale or retail seller of cigars or pipe tobacco shall affirm that the purchaser of said product is 21 years of age or older before the time of sale.

Del. Code tit. 30, § 5364 Disclosure requirements.

The notice required under § 5363(a)(3) of this title shall include: (1) A prominent and clearly legible statement that any tobacco product or tobacco substitute sales to consumers below the legal minimum purchase age are illegal; (2) A prominent and clearly legible statement that sales of cigarettes are restricted to those consumers who provide verifiable proof of age in accordance with § 5363 of this title; and (3) A prominent and clearly legible statement that any tobacco product sales are subject to tax under § 5305 of this title, and an explanation of how such tax has been, or is to be, paid with respect to such delivery sale.

Del. Code tit. 30, § 5365 Shipping requirements.

(a) Each person who mails, ships or otherwise delivers a tobacco product, as defined under § 5301 of this title, in connection with a delivery sale shall become affixing agents as defined under § 5301 of this title and shall be eligible to receive commissions under § 5318 of this title. Each person who mails, ships or otherwise delivers a tobacco product or tobacco substitute, as defined under § 5361 of this title, must do all of the following: (1) Include as part of the bill of lading or other shipping documents a clear and conspicuous statement providing as follows: “Any Tobacco Product or Tobacco Substitute: Delaware Law Prohibits Shipping to Individuals Under 21, and Requires the Payment of all Applicable Taxes”; (2) Use a method of mailing, shipping or delivery that obligates the delivery service to require: a. The consumer placing the purchase order for the delivery sale or another adult of legal minimum purchase age residing at the consumer’s address, to sign to accept delivery of the shipping container; and b. Proof, in the form of a valid, government-issued identification bearing a photograph of the individual who signs to accept delivery of the shipping container, demonstrating that the individual is either the addressee or another adult of legal minimum purchase age residing at the consumer’s address. However, proof of the legal minimum purchase age shall be required only if such individual appears to be under 30 years of age; and (3) Provide to the delivery service retained for such delivery sale evidence of full compliance with § 5367 of this title. (b) If the person accepting a purchase order for a delivery sale delivers any tobacco product or tobacco substitute without using a delivery service, such person shall comply with all requirements of this subchapter applicable to a delivery service and shall be in violation of the provisions of this subchapter if such person fails to comply with any such requirement.

Del. Code tit. 30, § 5366 Registration and reporting requirements.

(a) Prior to making delivery sales or mailing, shipping or otherwise delivering any tobacco product, as defined under § 5301 of this title, in connection with any such sales, every person shall file with the Department a statement setting forth such person’s name, trade name and the address of such person’s principal place of business and any other place of business. (b) Not later than the tenth day of each calendar month, each person that has made a delivery sale or mailed, shipped or otherwise delivered any tobacco product, as defined under § 5301 of this title, in connection with any such sale during the previous calendar month shall file with the Department a memorandum or a copy of the invoice that provides for each and every such delivery sale: (1) The name and address of the consumer to whom such delivery sale was made; (2) The brand or brands of the any tobacco product, as defined under § 5301 of this title, that were sold in such delivery sale; and (3) The quantity of cigarettes that were sold in such delivery sale. (c) Any person that satisfies the requirements of 15 U.S.C. § 376 shall be deemed to satisfy the requirements of this section.

Del. Code tit. 30, § 5367 Collection of taxes.

Each person accepting a purchase order for a delivery sale, to include cigars and pipe tobacco shall collect and remit to the Department all any tobacco product taxes imposed by this State with respect to such delivery sale, except that such collection and remission shall not be required to the extent such person has obtained proof (in the form of the presence of applicable tax stamps or otherwise) that such taxes already have been paid to the State.

Del. Code tit. 30, § 5368 Penalties.

(a) Except as otherwise provided in this section, a first violation of any provision of this subchapter shall be punishable by a fine of $1,000 or 5 times the retail value of the any tobacco product or tobacco substitute involved, whichever is greater. A second or subsequent violation of any provision of this subchapter shall be punishable by a fine of $5,000 or 5 times the retail value of the tobacco products or tobacco substitutes involved, whichever is greater. (b) Any person who knowingly violates any provision of this subchapter, or who knowingly and falsely submits a certification under § 5363(a)(1) of this title in another person’s name, shall, for each such offense, be fined $10,000 or 5 times the retail value of the cigarettes involved, whichever is greater, or imprisoned not more than 5 years, or both. (c) Any person failing to collect or remit to the Department any tax required in connection with a delivery sale shall be assessed, in addition to any other penalty, a penalty of 5 times the retail value of the any tobacco product involved. (d) (1) Any cigarettes sold or attempted to be sold in a delivery sale that do not meet the requirements of this subchapter shall be forfeited to the State and destroyed. (2) All fixtures, equipment and all other materials and personal property on the premises of any person who, with the intent to defraud the State, violates any of the requirements of this subchapter, shall be forfeited to the State.

Del. Code tit. 30, § 5369 Enforcement.

The Attorney General or the Attorney General’s designee, or any person who holds a valid permit under 26 U.S.C. § 5712, may bring an action in the appropriate court in this State to prevent or restrain violations of this subchapter by any person or any person controlling such person.
Source: DE Code (Official Site)URL: https://delcode.delaware.gov/title30/c053/sc01/index.htmlFetched: 10/4/2026

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