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Internal Revenue Code, § 5754. Restriction On Importation Of Previously Exported Tobacco Products

I.R.C. § 5754(a) Export-Labeled Tobacco Products
I.R.C. § 5754(a)(1) In General
Tobacco products and cigarette papers and tubes manufactured in the United States and labeled for exportation under this chapter—
I.R.C. § 5754(a)(1)(A)
may be transferred to or removed from the premises of a manufacturer or an export warehouse proprietor only if such articles are being transferred or removed without tax in accordance with section 5704;
I.R.C. § 5754(a)(1)(B)
may be imported or brought into the United States, after their exportation, only if such articles either are eligible to be released from customs custody with the partial duty exemption provided in section 5704(d) or are returned to the original manufacturer of such article as provided in section 5704(c); and
I.R.C. § 5754(a)(1)(C)
may not be sold or held for sale for domestic consumption in the United States unless such articles are removed from their export packaging and repackaged by the original manufacturer into new packaging that does not contain an export label.
I.R.C. § 5754(a)(2) Alterations By Persons Other Than Original Manufacturer
This section shall apply to articles labeled for export even if the packaging or the appearance of such packaging to the consumer of such articles has been modified or altered by a person other than the original manufacturer so as to remove or conceal or attempt to remove or conceal (including by the placement of a sticker over) any export label.
I.R.C. § 5754(a)(3) Exports Include Shipments To Puerto Rico
For purposes of this section, section 5704(d), section 5761, and such other provisions as the Secretary may specify by regulations, references to exportation shall be treated as including a reference to shipment to the Commonwealth of Puerto Rico.
I.R.C. § 5754(b) Export Label
For purposes of this section, an article is labeled for export or contains an export label if it bears the mark, label, or notice required under section 5704(b).
I.R.C. § 5754(c) Cross References
I.R.C. § 5754(c)(1)
For exception to this section for personal use, see section 5761(d).
I.R.C. § 5754(c)(2)
For civil penalties related to violations of this section, see section 5761(c).
I.R.C. § 5754(c)(3)
For a criminal penalty applicable to any violation of this section, see section 5762(b).
I.R.C. § 5754(c)(4)
For forfeiture provisions related to violations of this section, see section 5761(c).
(Added by Pub. L. 105-33, Sec. 9302(h)(1)(E), Aug. 5, 1997; amended by Pub. L. 106-476, title IV, Sec. 4002(a), Nov. 9, 2000; Pub. L. 109-432, div. C, title IV, Sec. 401(f)(2)(B), Dec. 20, 2006, 120 Stat. 2922.)
BACKGROUND NOTES
AMENDMENTS
2006 - Subsec. (c)(1). Pub. L. 109-432, Sec. 401(f)(2)(B), amended par. (1) by substituting “section 5761(d)” for “section 5761(c)”.
2000 - Sec. 5754. Pub. L. 106-476, Sec. 4002(a), amended Sec. 5754. Prior to amendment, it read as follows:
“(a) IN GENERAL--Tobacco products and cigarette papers and tubes previously exported from the United States may be imported or brought into the United States only as provided in section 5704(d). For purposes of this section, section 5704(d), section 5761, and such other provisions as the Secretary may specify by regulations, references to exportation shall be treated as including a reference to shipment to the Commonwealth of Puerto Rico.
“(b) CROSS REFERENCE--
“For penalty for the sale of tobacco products and cigarette papers and tubes in the United States which are labeled for export, see section 5761(c).”
EFFECTIVE DATE OF 2006 AMENDMENT
Amendment by Pub. L. 109-432, Sec. 401(f)(2)(B), effective for goods entered, or withdrawn from warehouse for consumption, on or after the 15th day after the date of the enactment of this Act [Enacted: Dec. 20, 2006].
EFFECTIVE DATE OF 2000 AMENDMENT
Amendment by Pub. L. 106-476, Sec. 4002(a), effective 90 days after the date of the enactment of this Act [Enacted: Nov. 9, 2000].
EFFECTIVE DATE
Section 9302(i) of Pub. L. 105-33 provided that:
“(1) IN GENERAL--The amendments made by this section shall apply to articles removed (as defined in section 5702(k) of the Internal Revenue Code of 1986, as amended by this section) after December 31, 1999.
“(2) TRANSITIONAL RULE--Any person who--
“(A) on the date of the enactment of this Act is engaged in business as a manufacturer of roll-your-own tobacco or as an importer of tobacco products or cigarette papers and tubes, and
“(B) before January 1, 2000, submits an application under subchapter B of chapter 52 of such Code to engage in such business, may, notwithstanding such subchapter B, continue to engage in such business pending final action on such application. Pending such final action, all provisions of such chapter 52 shall apply to such applicant in the same manner and to the same extent as if such applicant were a holder of a permit under such chapter 52 to engage in such business.”
STUDY
Section 4002(e) of Pub. L. 106-476 provided the following:
“The Secretary of the Treasury shall report to Congress on the impact of requiring export warehouses to be authorized by the original manufacturer to receive relanded export-labeled cigarettes.”
FLOOR STOCKS TAXES
Section 9302(j) of Pub. L. 105-33, as amended by Sec. 315(a)(1) of Pub. L. 106-554 provided that:
“(1) IMPOSITION OF TAX--On cigarettes manufactured in or imported into the United States which are removed before any tax increase date, and held on such date for sale by any person, there is hereby imposed a tax in an amount equal to the excess of--
“(A) the tax which would be imposed under section 5701 of the Internal Revenue Code of 1986 on the article if the article had been removed on such date, over
“(B) the prior tax (if any) imposed under section 5701 of such Code on such article.
“(2) AUTHORITY TO EXEMPT CIGARETTES HELD IN VENDING MACHINES-- To the extent provided in regulations prescribed by the Secretary, no tax shall be imposed by paragraph (1) on cigarettes held for retail sale on any tax increase date, by any person in any vending machine. If the Secretary provides such a benefit with respect to any person, the Secretary may reduce the $500 amount in paragraph (3) with respect to such person.
“(3) CREDIT AGAINST TAX--Each person shall be allowed as a credit against the taxes imposed by paragraph (1) an amount equal to $500. Such credit shall not exceed the amount of taxes imposed by paragraph (1) on any tax increase date, for which such person is liable.
“(4) LIABILITY FOR TAX AND METHOD OF PAYMENT--
“(A) LIABILITY FOR TAX--A person holding cigarettes on any tax increase date, to which any tax imposed by paragraph (1) applies shall be liable for such tax.
“(B) METHOD OF PAYMENT--The tax imposed by paragraph (1) shall be paid in such manner as the Secretary shall prescribe by regulations.
“(C) TIME FOR PAYMENT--The tax imposed by paragraph (1) shall be paid on or before April 1 following any tax increase date.
“(5) ARTICLES IN FOREIGN TRADE ZONES--Notwithstanding the Act of June 18, 1934 (48 Stat. 998, 19 U.S.C. 81a) and any other provision of law, any article which is located in a foreign trade zone on any tax increase date, shall be subject to the tax imposed by paragraph (1) if--
“(A) internal revenue taxes have been determined, or customs duties liquidated, with respect to such article before such date pursuant to a request made under the 1st proviso of section 3(a) of such Act, or
“(B) such article is held on such date under the supervision of a customs officer pursuant to the 2d proviso of such section 3(a).
“(6) DEFINITIONS--For purposes of this subsection--
“(A) IN GENERAL--Terms used in this subsection which are also used in section 5702 of the Internal Revenue Code of 1986 shall have the respective meanings such terms have in such section, as amended by this Act.
“(B) TAX INCREASE DATE--The term ‘tax increase date’ means January 1, 2000, and January 1, 2002.
“(C) SECRETARY--The term ‘Secretary’ means the Secretary of the Treasury or the Secretary's delegate.
“(7) CONTROLLED GROUPS--Rules similar to the rules of section 5061(e)(3) of such Code shall apply for purposes of this subsection.
“(8) OTHER LAWS APPLICABLE--All provisions of law, including penalties, applicable with respect to the taxes imposed by section 5701 of such Code shall, insofar as applicable and not inconsistent with the provisions of this subsection, apply to the floor stocks taxes imposed by paragraph (1), to the same extent as if such taxes were imposed by such section 5701. The Secretary may treat any person who bore the ultimate burden of the tax imposed by paragraph (1) as the person to whom a credit or refund under such provisions may be allowed or made.”