Tobacco wholesaler Western Sales Trading Company has until June 9 to tell the court why the Department of Revenue and Taxation should be ordered to implement a tax stamp program on cigarettes.
Western Sales, which distributes RJ Reynolds tobacco products on the island, asked the Guam Superior Court in April to order Reverend and Tax Director Dafne Shimizu to follow the law on revenue stamps.
The Cigarette Tax Stamp Act 2017, which requires wholesalers to purchase and affix stamps to the bottom of cigarette packs to prove that tobacco taxes have been paid, has never been implemented by Rev and Tax.
According to Western Sales, the failure to implement the program puts the company at a price disadvantage if other tobacco wholesalers on the island do not collect and pay the taxes.
Guam Del. Mike San Nicolas, who drafted the revenue stamp law when he was in the legislature, said the public auditor said $ 14 million in tobacco taxes had not been collected.
The current tobacco tax is $ 4 per pack of cigarettes, 58 cents per standard cigar, and $ 53 per pound for all other tobacco products. The tax must be paid by wholesalers or distributors. Guam consumers buy about 11.5 million packs of cigarettes per year, according to lawmakers.
On May 19, the attorney general’s office asked Superior Court Judge Dana Gutierrez to dismiss the company’s court order request, saying the issue was moot because Rev and Tax had already started providing services. for the cigarette stamp program.
The attorney general also said Western Sales did not have the right to request a writ. Rev and Tax can decide how to apply tax laws, and it is not appropriate to order the agency to take specific action, the attorney general’s office said.
Gutierrez has set a June 9 deadline for Western Sales to respond to the attorney general’s brief, and the attorney general has a June 30 deadline to file a response.
“I will set a court date if necessary after that, depending on what is filed with the court,” the judge said.