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Statutes of Newfoundland 1993


CHAPTER 52

CHAPTER 52

AN ACT TO AMEND THE TOBACCO TAX ACT

(Assented to December 17, 1993)

Analysis

1. S.2 Amdt.
Definitions

2. S.3 Amdt.
Tax levied

3. Ss. 4 to 7 R&S
4. Permit
5. Transporter duties
6. Prohibition
7. Mark and stamp permits

4. S.28 Amdt.
Proof of ownership

5. S.29 R&S
Confidentiality

6. S.39 Amdt.
Appointment of inspectors

7. S.41 R&S
Search for tobacco or records

8. Ss. 42 & 43 R&S
42. Seizure of contraband
43. Disposal
43.1 Third party claims

9. S.45 Amdt.
Regulations

10. S.68.1 Added
Offence: contraband

11. S.71.1 Added
Default

12. RSN 1990 cG-1
Amdt.

13. RSN 1990 cH-1
Amdt.

14. RSN 1990 cL-18
Amdt.

15. RSN 1990 cR-15
Amdt.

Be it enacted by the Lieutenant-Governor and House of Assembly in Legislative Session convened, as follows:


RSN 1990 cT-5 as amended

1. (1) Section 2 of the Tobacco Tax Act is amended by adding immediately after paragraph (b) the following:

(b.1) "contraband" means tobacco that is not purchased, possessed, acquired, marked, stamped, transported, stored or sold in accordance with this Act and includes unmarked tobacco possessed without lawful reason;

(2) Section 2 of the Act is amended by adding immediately after paragraph (e) the following:

(e.1) "marked tobacco" means tobacco in packages, cartons or cases that are marked or stamped as required under this Act;

(3) Paragraph 2(g) of the Act is repealed and the following substituted:

(g) "motor vehicle" means a vehicle propelled, driven or controlled otherwise than by muscular power and includes a trailer;

(g.1) "package" includes a bag, box, tin or other container in which tobacco is packaged for retail sale;

(4) Section 2 of the Act is amended by adding immediately after paragraph (p) the following:

(p.1) "trailer" means a vehicle which has no motive power of its own and which is attached to a motor vehicle upon a highway and includes a cargo container on or attached to a motor vehicle and a side car attached to a motor cycle;

(p.2) "transporter" means a person other than a consumer who transports tobacco in the province by any means, in an amount greater than is prescribed;

(p.3) "unmarked tobacco" means tobacco in packages, cartons or cases which are not marked or stamped as required under this Act, or which are marked or stamped "Not for Sale in Canada", "Canada Duty Not Paid", or which contain or are labelled with a fraudulent, forged or false mark or stamp;

2. Section 3 of the Act is amended by renumbering it as subsection 3(1) and by adding immediately after that subsection the following:

(2) A person who, as a consumer, brings tobacco into the province or receives delivery of tobacco in the province shall, except as prescribed by regulation, immediately report and pay to the Crown the tax that would be payable had that tobacco been acquired at a retail sale in the province.

3. Sections 4, 5, 6 and 7 of the Act are repealed and the following substituted:

Permit

4. (1) A person shall not bring tobacco or cause tobacco to be brought into the province in an amount greater than is prescribed by regulation without holding a permit issued under this section.

(2) The minister may issue a permit in the form and manner prescribed by regulation authorizing a person to bring tobacco in an amount greater than is prescribed into the province and may set those reasonable restrictions and conditions upon the permit with respect to the marking or stamping of tobacco, collection and payment of tax or other things that the minister considers necessary.

(3) The minister may for cause refuse to issue or may cancel or suspend a permit issued under this section to a person who the minister is satisfied or has reason to believe will not comply or has not complied with this Act or the regulations.

(4) An application for a permit under this section shall be made to the minister in the form and manner and accompanied by the fee that may be prescribed by regulation in respect of that permit.

Transporter duties

5. (1) A person who holds a permit issued under section 4 shall provide a notarized true copy of that permit to a transporter who transports tobacco to, from or for him or her.

(2) A transporter shall at all times and in accordance with the regulations, keep in the motor vehicle used to transport the tobacco the permit copy referred to in subsection (1), a uniform manifest and other bills of lading, waybills, records, books or other documents that are prescribed by regulation.

Prohibition

6. (1) A person shall not sell or give unmarked tobacco to

(a) a consumer who is required to pay tax; or

(b) a dealer who is not authorized under this Act to possess unmarked tobacco.

(2) A person shall not mark packages, cartons or cases of tobacco unless he or she has a permit to mark tobacco issued under section 7.

(3) A person shall not stamp packages, cartons or cases of tobacco unless he or she has a permit to stamp tobacco issued under section 7.

(4) A person shall not sell, give, possess, mark or stamp a package of cigarettes that contains 19 or less cigarettes.

Mark and stamp permits

7. (1) A person shall not possess, sell or purchase unmarked tobacco unless he or she is authorized under the regulations to possess unmarked tobacco.

(2) The minister may issue a permit to mark tobacco packages, cartons or cases to a manufacturer of tobacco and tobacco products.

(3) The minister may issue a permit to stamp tobacco packages, cartons or cases to a person who holds a licence under section 6 who acquires tobacco from a person who does not have a permit to mark tobacco issued under subsection (2).

(4) The minister may, before issuing a permit under this section, require and impose reasonable restrictions upon that permit.

(5) A person who has been issued a permit to stamp tobacco packages, cartons or cases under this section shall provide to the minister an accounting for all stamps received by that person from the minister.

(6) A person who has been issued a permit to stamp tobacco packages, cartons or cases under this section shall account for each stamp as required under subsection (5) and each stamp that is not accounted for shall be considered to have been affixed to a tobacco package, carton or case and sold to a consumer who has paid tax and that tax shall be paid by that person to the Crown in accordance with this Act.

(7) The minister may suspend or cancel a permit issued to a person under this section if that person contravenes a condition or restriction placed upon it and where that permit is held by a collector, may cancel the wholesaler's licence of that collector.

4. Subsections 28(4) and (5) of the Act are repealed.

5. Section 29 of the Act is repealed and the following substituted:

Confidentiality

29. (1) The minister may authorize the persons who may receive information, records or returns under this Act and he or she shall not authorize a person to receive the information, records or returns unless it is necessary to do so for the purpose of this Act.

(2) A person who has custody of or control over information, records or returns under this Act shall not disclose that information or those records or returns to another person except

(a) in the course of administering or enforcing this or another taxation Act;

(b) in the course of administering or enforcing the Liquor Control Act or the Liquor Corporation Act;

(c) under an agreement that

(i) is between the government of the province and another government,

(ii) relates to the administration or enforcement of a taxation Act, and

(iii) provides for the disclosure of information, returns and records to and the exchange of similar information, returns and records with that other government; or

(d) for the purpose of the compilation of statistical information by the government of the province or the Government of Canada.

6. Section 39 of the Act is amended by renumbering it as subsection 39(1) and adding the following immediately after subsection (1):

(2) The minister may authorize a person employed in the department or a person or class of persons designated under subsection (1) to perform and exercise those duties imposed and powers conferred by this Act upon the inspector that may, in the opinion of the minister, be conveniently performed or exercised by that person and the performance or exercise of those duties or powers by that authorized person shall be of the same effect as if they were performed or exercised by the minister.

7. Section 41 of the Act is repealed and the following substituted:

Search for tobacco or records

41. (1) Where an inspector believes on reasonable grounds that a person is contravening or has contravened this Act, the inspector may, with a warrant issued under subsection (2),

(a) enter a commercial or private premises in the province and search for contraband;

(b) examine the contents of the commercial or private premises and make those enquiries that the inspector considers are necessary;

(c) seize, take away and hold contraband;

(d) make copies or abstracts of books or records that may give evidence of a contravention of this Act;

(e) take away books or records for the purpose of making copies and the original books and records shall be returned immediately;

(f) seize and take away manifests, records, accounts and vouchers and retain them until they are produced in a court proceeding; and

(g) seize, take away and hold a motor vehicle, air craft, ship, boat or other thing in which contraband is located in or on a commercial or private premises.

(2) A Provincial Court judge or justice of the peace who is satisfied upon oath or affirmation that there are reasonable grounds for believing that there is in a commercial or private premises anything that there are reasonable grounds to believe will give evidence with respect to a contravention of this Act may issue a warrant authorizing the inspector named in the warrant to enter the commercial or private premises, and search for contraband and make those enquiries, seizures and copies of books, documents, correspondence and records that are necessary, subject to the conditions that may be specified in the warrant.

(3) The owner or person in charge of the premises referred to in this section and a person found there shall give an inspector reasonable help to enable the inspector to carry out his or her duties and functions under this section and shall provide the information that the inspector may reasonably require.

(4) Notwithstanding subsection (1), an inspector may exercise the power of search referred to in that subsection without a warrant issued under subsection (2) where the conditions for obtaining the warrant exist but by reason of exigent circumstances it would not be practical to obtain the warrant.

(5) For the purpose of subsection (4), exigent circumstances include circumstances in which the delay necessary to obtain the warrant would result in danger to human life or safety or the loss or destruction of evidence.

(6) For the purpose of this section, the word "premises" includes a receptacle or container that is not a motor vehicle or trailer.

8. Sections 42 and 43 of the Act are repealed and the following substituted:

Seizure of contraband

42. Where an inspector believes on reasonable grounds that a person is in possession of contraband, he or she may, without a warrant, stop and detain in the province a motor vehicle, aircraft, ship or boat, in which he or she has reasonable grounds to believe that contraband is located and may examine the contents of that motor vehicle, aircraft, ship or boat, including cargo, manifests, records, accounts, vouchers, papers or things that may provide evidence that the motor vehicle, aircraft, ship or boat is carrying contraband and may

(a) seize, take away and hold contraband;

(b) seize, take away and detain a motor vehicle, aircraft, ship, boat, receptacle or container in which contraband is located; and

(c) seize and take away manifests, records, accounts and vouchers and retain them until they are produced in a court proceeding.

Disposal

43. (1) Thirty days following its seizure, tobacco seized as contraband under section 41 or 42 shall be forfeited to the Crown to be disposed of as the minister directs.

(2) The proceeds from the sale of tobacco directed to be sold by the minister under subsection (1) shall, after payment of costs incurred by the minister in seizing, impounding, holding and disposing of the tobacco, be paid into the Consolidated Revenue Fund.

(3) Where a person from whom contraband or a motor vehicle, aircraft, ship or boat, has been seized under section 41 or 42 is convicted of an offence under section 68.1 with respect to that seizure, that contraband, motor vehicle, aircraft, ship or boat, shall be forfeited to the Crown to be disposed of as the minister directs.

(4) The proceeds from the sale of contraband, a motor vehicle, aircraft, ship or boat, directed to be sold under subsection (3) shall, after payment of costs incurred by the minister in seizing, impounding, holding and disposing of them, be paid into the Consolidated Revenue Fund.

(5) A person from whom a motor vehicle, aircraft, ship or boat has been seized under section 41 or 42 who is not convicted of an offence under section 68.1 in relation to that seizure shall have that thing returned to him or her within 3 months from the date of the court proceedings at which the finding of not guilty was made unless further proceedings by way of appeal have been commenced.

(6) A person from whom tobacco seized as contraband has been seized under section 41 or 42 or seized and sold under subsection (1) who is not convicted of an offence under section 68.1 in relation to that seizure and who establishes to the satisfaction of the minister that the tobacco is not contraband and is his or her property may apply to the minister to have that property returned to him or her or for reimbursement of the value of that tobacco and the minister shall return that property to him or her or pay out to him or her from the Consolidated Revenue Fund an amount equal to the value of tobacco that was his or her tobacco at the time of its seizure plus interest in the manner prescribed by regulation.

Third party claims

43.1 (1) A person, other than a person accused of an offence relating to a seizure under section 41 or 42 who claims an interest in a motor vehicle, aircraft, ship or boat, seized under those sections, as an owner, lienholder or holder of a like interest may, within 30 days after that seizure, apply to a Provincial Court judge for an order under subsection (2).

(2) If, on the hearing of an application under subsection (1) a Provincial Court judge is satisfied that the applicant has not been involved in the offence resulting in the seizure and has not colluded with an accused in relation to the offence, the judge may declare that the applicant's interest is not affected by the seizure, the nature and extent of the applicant's interest at the time of the contravention and may order that a seized motor vehicle, aircraft, ship or boat be returned to the applicant at a time and subject to conditions to be specified by the judge.

(3) Where a Provincial Court judge orders that a motor vehicle, aircraft, ship or boat be returned to an applicant under subsection (2), he or she shall order that applicant to post a bond or other form of security in an amount satisfactory to the judge, but not less than the market value of the seized item, pending a final resolution of proceedings commenced under this Act.

(4) Where a person from whom a motor vehicle, aircraft, ship or boat has been seized under section 41 or 42 is convicted of an offence under section 68.1, a bond or other security posted under subsection (3) shall be forfeited to the Crown.

9. Subsection 45(1) of the Act is amended by adding immediately after paragraph (s) the following:

(s.1) prescribing the fee and the form and manner of applying for and utilizing permits issued under section 4, uniform manifests and other documents required under this Act including providing for the placing of time or other restrictions upon those permits;

(s.2) governing the activities of those who are required or permitted to hold permits or licences under this Act;

(s.3) prescribing the amount of tobacco which a transporter may carry or transport, and the bills of lading, waybills, records, books or other documentation which he or she shall have;

(s.4) prescribing the responsibilities of holders of permits to mark or stamp tobacco including accounting for the receipt, use of and holding of stamps or stamping and marking equipment;

(s.5) providing a system for the sale of unmarked tobacco to classes of person who are exempt from the payment of tax imposed by this Act, including the limitation on the quantity of unmarked tobacco to be sold to retailers for resale to consumers;

(s.6) providing for the furnishing to the minister of information related to the sale or delivery of tobacco products that are exempt from tax imposed by this Act or that are delivered to classes of persons who are exempt from the payment of tax imposed by this Act;

(s.7) prescribing the criteria to be met by a person under section 7;

(s.8) providing for the affixing of stamps and marks on tobacco packages, cartons or cases before or at the time of delivery to a consumer as evidence of the tax having been paid;

(s.9) providing for the issue of the stamps and the designs and denominations of stamps and marks;

(s.10) prohibiting the delivery of tobacco to a consumer and the taking of delivery by a consumer upon which stamps or marks are not affixed in accordance with the Act and regulations;

(s.11) providing for the stamping or marking of tobacco packages, cartons or cases before or at the time of delivery to a consumer as evidence of the tax having been paid;

(s.12) prohibiting the delivery to a consumer and the taking of delivery by a consumer of tobacco which is not stamped or marked in accordance with the Act and regulations;

(s.13) prescribing classes of tobacco that may be exempt from the application of sections 5 and 6;

(s.14) prescribing the manner in which contraband may be sold by the minister and the method of reimbursing a person under subsection 43(6) including the manner in which interest shall be paid;

10. The Act is amended by adding immediately after section 68 the following:

Offence: contraband

68.1 (1) A person who purchases, possesses, acquires, transports, stores or sells contraband is guilty of an offence and is liable on summary conviction

(a) for a 1st offence, to

(i) a fine of not less than $200 nor more than $10,000, or

(ii) imprisonment for a period of not more than 2 years, or

(iii) both a fine and imprisonment;

(b) for a 2nd offence, to

(i) a fine of not less than $500 nor more than $50,000, or

(ii) imprisonment for a period of not more than 2 years, or

(iii) both a fine and imprisonment; and

(c) for a 3rd or subsequent offence, to

(i) a fine of not less than $1,000 and not more than $100,000, or

(ii) imprisonment for a period of not more than 2 years, or

(iii) both the fine and imprisonment.

(2) In addition to the penalties which are imposed under subsection (1), a court shall order the person found guilty of an offence under this section to pay an additional fine equal to 5 times the amount of the tax payable on the contraband had the contraband been tobacco marked under this Act and purchased by a consumer.

(3) In addition to the fines imposed under subsections (1) and (2), a court shall order a person who defaults in the payment of those fines be imprisoned for a period of not less than 1 month and not more than 6 months and that period of imprisonment shall be in addition to any other period of imprisonment imposed under this section.

11. The Act is amended by adding immediately after section 71 the following:

Default

71.1 (1) Where default is made in the payment of a fine or a part of it that is due on behalf of the Crown under this Act, the minister may issue a certificate stating the amount due and remaining unpaid, and the name of the person by whom it is payable, and may file the certificate with the Registrar of the Supreme Court.

(2) Where a certificate is filed with the Registrar of the Supreme Court, it is of the same effect and proceedings may be taken on it as if it were a judgment of the Trial Division for the recovery of a debt of the amount stated in the certificate against the person named in it.

(3) This section does not apply where a default period has been imposed and has been satisfied.

RSN 1990 cG-1 Amdt.

12. (1) Section 17 of the Gasoline Tax Act is amended by adding immediately after subsection (2) the following:

(3) Where the holder of a retailer licence under this Act is guilty of an offence under section 68.1 of the Tobacco Tax Act, the minister shall cancel or suspend that person's retailer licence.

(2) Section 22 of the Act is repealed and the following substituted:

Confidentiality

22. (1) The minister may authorize the persons who may receive returns under this Act and he or she shall not authorize a person to receive those returns unless it is necessary to do so for the purpose of this Act.

(2) A person who has custody of or control over information, records or returns under this Act shall not disclose that information or those records or returns to another person except

(a) in the course of administering or enforcing this Act or another taxation Act;

(b) in the course of administering or enforcing the Liquor Control Act or the Liquor Corporation Act;

(c) under an agreement that

(i) is between the government of the province and another government,

(ii) relates to the administration or enforcement of a taxation Act, and

(iii) provides for the disclosure of information, returns and records to and the exchange of similar information, returns and records with that other government; or

(d) for the purpose of the compilation of statistical information by the government of the province or the Government of Canada.

(3) Notwithstanding subsection (2), the minister may communicate to a collector information on the type of gasoline sold in the province and on the identity of the sellers.

RSN 1990 cH-1 Amdt.

13. Section 22 of the Health and Post-Secondary Education Tax Act is repealed and the following substituted:

Confidentiality

22. (1) The minister may authorize the persons who may receive returns or information under this Act and he or she shall not authorize a person to receive those returns or that information unless it is necessary to do so for the purpose of this Act.

(2) A person who has custody of or control over information, records or returns under this Act shall not disclose that information or those records or returns to another person except

(a) in the course of administering or enforcing this Act or another taxation Act;

(b) in the course of administering or enforcing the Liquor Control Act or the Liquor Corporation Act;

(c) under an agreement that

(i) is between the government of the province and another government,

(ii) relates to the administration or enforcement of a taxation Act, and

(iii) provides for the disclosure of information, returns and records to and the exchange of similar information, returns and records with that other government; or

(d) for the purpose of the compilation of statistical information by the government of the province or the Government of Canada.

RSN 1990 cL-18 Amdt.

14. Subsection 33(5) of the Liquor Control Act is repealed and the following substituted:

(5) The board shall cancel a licence where the licensee operates an electronic or mechanical amusement device in contravention of the Lotteries Act or is guilty of an offence under section 68.1 of the Tobacco Tax Act.

RSN 1990 cR-15 Amdt.

15. (1) Section 24 of the Retail Sales Tax Act is amended by adding immediately after subsection (2) the following:

(2.1) The minister shall refuse to issue a registration certificate to a person or shall cancel or suspend the registration certificate of a person who is guilty of an offence under section 68.1 of the Tobacco Tax Act.

(2) Section 30 of the Act is repealed and the following substituted:

Confidentiality

30. (1) The minister may authorize the persons who may receive returns under this Act and he or she shall not authorize a person to receive those returns unless it is necessary to do so for the purpose of this Act.

(2) A person who has custody of or control over information, records or returns under this Act shall not disclose that information or those records or returns to another person except

(a) in the course of administering or enforcing this Act or another taxation Act;

(b) in the course of administering or enforcing the Liquor Control Act or the Liquor Corporation Act;

(c) under an agreement that

(i) is between the government of the province and another government,

(ii) relates to the administration or enforcement of a taxation Act, and

(iii) provides for the disclosure of information, returns and records to and the exchange of similar information, returns and records with that other government; or

(d) for the purpose of the compilation of statistical information by the government of the province or the Government of Canada.

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