Tax and Revenue Administration Alberta Tobacco Tax Act Information Circular TTA-8R3

TTA-8R3 / January 2010

ALBERTA TOBACCO TAX ACT INFORMATION CIRCULAR:
TAXABLE PRICE OF A CIGAR

NOTE: This information circular is intended to explain legislation and provide specific information. Every effort has been made to ensure the contents are accurate. However, if a discrepancy should occur in interpretation between this information circular and governing legislation, the legislation takes precedence.

TAXABLE PRICE OF A CIGAR

This information circular defines the taxable price of a cigar in Alberta effective 12:01, April 8, 2009, and provides information on the following topics:

• Tobacco Tax Rates
• Taxable Price of a Cigar
• Importer’s Selling Price
• When the Manufacturer or Importer Is also a Cigar Retailer

Tobacco Tax Rates

1. Current and historic tobacco tax rates are listed in the rates table found on Tax and Revenue Administration’s website.

 Taxable Price of a Cigar

2. “Taxable price” of a cigar means 1.3 times one of the amounts below:

• if the cigar was manufactured in Canada and the manufacturer is not the retailer
  • the manufacturer’s selling price before any volume discounts, including any charges for transportation, and any duty and excise tax, but excluding the goods and services tax (GST).
    
    
• if the cigar was manufactured outside Canada and the importer is not the retailer
  • the importer’s selling price before any volume discounts including any charges for transportation, and any duty and excise tax, but excluding GST.

Importer’s Selling Price

3. The importer’s selling price is the greater of

• the price charged by the importer, or
• the price charged by a party to whom the importer sells the cigar and with whom the importer does not deal at arm’s length.

When the Manufacturer or Importer Is also a Retailer

4. If the manufacturer or importer of a cigar is also a cigar retailer the taxable price of the cigar is the price paid by the consumer, including any charges for transportation and any duty and excise tax, excluding GST.