Amends TCA Title 4; Title 29; Title 39, Chapter 17; Title 39, Chapter 15; Title 43; Title 67, Chapter 4, Part 10 and Title 68.

This bill revises and enacts various provisions regarding tobacco, hemp, and vapor products, as follows: (1) Under present law, it is unlawful for a person under 21 years of age to possess either a tobacco, smoking hemp, or vapor product, to purchase or accept receipt of either product, or to present or offer to any person any purported proof of age that is false, fraudulent, or not actually that person's own for the purpose of purchasing or receiving any tobacco, smoking hemp, or vapor product. Present law provides that a law enforcement officer with evidence of a violation may issue a citation to the violator, and that regardless of whether a citation is issued, the office must seize the product as contraband. This bill revises this provision to instead prohibit a law enforcement officer from issuing a citation for a violation but requiring the officer to seize the product as contraband if the officer has evidence of a violation. Also, under present law a violation is a civil offense with a penalty of not less than $10.00 nor more than $50.00 charged against a parent, guardian, or custodian, but not a minor. This bill removes the civil penalty. (2) Present law requires the department of agriculture to conduct random, unannounced inspections at locations where tobacco, smoking hemp, or vapor products are sold or distributed to ensure compliance with the Prevention of Youth Access to Tobacco, Smoking Hemp, and Vapor Products Act. This bill requires the department to conduct at least two such inspections each year. This bill adds that if a location is found to be in violation of the Act, the department must make an unannounced inspection within six months of the violation. (3) Under present law, a person who violates provisions regarding the sale of tobacco products to minors, signage, vending machine sales, or packaging receives a warning letter and does not receive a civil penalty for the person's first violation. A violator is subject to a civil penalty of not more than $500 for a second violation, not more than $1,000 for a third violation, and not more than $1,500 for a fourth or subsequent violation. This bill limits the imposition of a fine to the retailer who is in violation, and revises the civil penalties to instead impose a $250 civil penalty for the first violation of provisions on sale of tobacco products to minors, signage, vending machine sales, or packaging. A second violation will incur a penalty of $500, and a third or subsequent violation will incur a penalty of $1,000. This bill adds authorization for the commissioner to a retailer's tobacco license for a period of not less than 30 days and not more than 90 days if the person is in violation three or more times within a three-year period and to revoke a person's retail tobacco license for any subsequent violations. (4) This bill makes vapor products subject to the Tobacco Tax Law. Under present law, cigarettes are taxed at a per cigarette and per pack rate and other tobacco products are taxed at the rate of 6.6 percent of the wholesale cost price. Under this bill, the rate of the tax for closed-system vapor products will be 5 cents per milliliter of consumable material and a proportionate tax at the same rate on all fractional parts thereof; and the rate for open-system vapor products will be 5 percent of the wholesale cost price. (5) This bill requires a person who operates a business in which tobacco products are sold at retail to obtain an annual retail tobacco license from the department of agriculture before engaging in the retail sale of tobacco products. This bill requires the commissioner to promulgate rules to establish the qualifications for the issuance of a retail tobacco license. Such rules must establish the fee for a retail tobacco license, which must be at a level to ensure the department's enforcement and licensing activities are fully funded. This bill prohibits a person from selling any tobacco products without first obtaining a retail tobacco license. Similarly, this bill prohibits a retailer whose retail tobacco license has been suspended or revoked from selling any tobacco products. A violation of these provisions will be a Class B misdemeanor.