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Under the Tobacco Control Act, the Food and Drug Administration (FDA) strictly regulates the sale and marketing of tobacco products.[1]U.S. Food and Drug Administration. “Family Smoking Prevention and Tobacco Control Act”. Accessed March 16, 2022. For that reason, selling, manufacturing, wholesaling, importing, or exporting cigarettes and other tobacco products require licenses issued by local, state, or federal authorities, depending on your operations. For example, importing, exporting, and manufacturing tobacco requires you to obtain a federally-issued license from the Alcohol & Tobacco Tax and Trade Bureau (TTB). Meanwhile, retail tobacco licenses—the type this article explores—are issued by state or local authorities.
Below explains how to apply for a retail tobacco license, the penalty for failing to get or renew a license, and your responsibilities as a tobacco license holder.
What is a Tobacco License?
State, city, and/or county officials issue retail tobacco licenses. A retail tobacco license gives a business the legal right to sell cigarettes and other tobacco products per state laws. Once obtained, you must display your retail tobacco license prominently in your location.[2]InfoTaxSquare. ”What is a Tobacco License and Permit”. Accessed March 16, 2022.
Do You Need a License to Sell Tobacco?
Yes. As a retailer of tobacco products, you must have and display a license to sell tobacco products. This applies if you are a person or business that buys tobacco products from suppliers and sells tobacco products directly to the public from a retail location, including sales from vending machines. If you sell tobacco products without a valid license, you’re subject to severe penalties by authorities.
Additionally, some states enforce the need for surety bonds, which guarantees, as a retailer, you pay the required taxes from the sale of tobacco products.[3]Alpha Surety. “Tobacco Surety Bond”. Accessed March 16, 2022.
How to Apply for a Tobacco License
Though similar across the board, the process to apply for a tobacco license varies from state to state. Generally, licenses are valid for a 12- or 24-month period and cannot be transferred. Additionally, you must have a separate license for each retail location.
As a specific example, to obtain your retail tobacco license in Florida, you must fill out form DBPR ABT-6028. The fee is $50 for each of your retail locations. Meanwhile, the New York City Department of Consumer and Worker Protection issues retail tobacco licenses online or in-person at the Department of Consumer and Worker Protection Licensing Center. The application fee is $150 to $200.[4]New York City Department of Consumer and Worker Protection. “Tobacco Retail Dealer License”. Accessed March 16, 2022.
To find the forms and fees specific to your state, contact your appropriate state agency or navigate your state’s official website.
Tobacco License FAQs
Still have questions? We answered some of the most frequently asked questions about obtaining tobacco licenses below. Let’s dive in!
How much is a tobacco license?
The cost of a tobacco license differs from state to state. In Texas, the licensing fee for selling tobacco products is $180, and the renewal period is two years.[5]Comptroller.Texas.Gov. “Cigar and Tobacco Permit Fees”. Accessed March 16, 2022. In Georgia, the licensing fee for retailers is only $10.[6]Department of Revenue, State of Georgia. “Tobacco Licensing Fees”. Accessed March 16, 2022. Meanwhile, Chicago’s licensing fee is $550.00 per location, renewable every two years.[7]Chicago.Gov. “Tobacco Dealer Licensing in Chicago”. Accessed March 16, 2022.
Keep in mind that some states, like Pennsylvania, also require filing fees along with a licensing fee.[8]InfoTaxSquare. “Guidelines to follow on how to obtain Cigarette and Tobacco products licenses in the State of Pennsylvania”. Accessed March 16, 2022.
How often is a tobacco license renewal?
Like the licensing cost, renewal requirements vary from state to state as well. Some states, cities, and counties require renewal every year, while other states only require you renew your license every two years.
Is there a penalty for failing to get a tobacco license?
Most states have strict penalties for selling tobacco without a license. This also goes for not renewing your license by the specific date listed. For instance, in Minnesota, the penalty for failing to have a license is a fine, suspension of license, and possible jail time.[9]American Heart Association. “Tobacco Retail Licensure”. Accessed March 16, 2022.
In Washington, authorities may charge you with a Class C felony for for failing to get a tobacco license. There is a $100 fine for the first offense, and a $200 fine for every subsequent offense, as well as jail time and suspension or revocation of your license.
How does your tobacco license need to be displayed?
Most states require all retail establishments to display tobacco licensure “clearly and visible to employees, cashiers, and patrons at or in close proximity to the point of sale of tobacco products.”[10]FDA. “Compliance, Enforcement and Training”. Accessed March 16, 2022. It’s best to check with your city or county to ensure you comply, as failure to display the license correctly is an offense in most states.
Can you sell tobacco online with a tobacco license?
The Alcohol & Tobacco Tax and Trade Bureau (TTB) does not have special rules for internet retail different from those specific to each state. To find out if you need licenses or permits to sell tobacco online in your state, contact the appropriate government agency in your state or navigate your state’s official website.
You should keep in mind that state and local laws may prohibit tobacco products from being sold by email or delivered by U.S. mail or another carrier.[11]Alcohol and Tobacco Tax and Trade Bureau. “Special Rules for Internet Sales”. Accessed March 16, 2022.
Do you need a license to sell vapes?
To sell Electronic Nicotine Delivery Systems (ENDS), more commonly known as vape products, the FDA enforces the FDCA (Food, Drug, and Cosmetic Act) to ensure ENDS products are safe for public use. Thus, all businesses selling such products must register with the FDA.[12]Compliance Gate. “E-Cigarette & E-Liquid Regulations in the United States: An Overview”. Accessed March 16, 2022.
Do all states require a license to sell tobacco products over-the-counter?
No. A few states, like Arizona, Wyoming, and South Dakota, to name a few, do not require state licensing to sell tobacco products.[13]Centers of Disease Control. “CDC factsheet”. Accessed March 16, 2022.
Your Responsibilities as a Tobacco License Holder
Your responsibilities as a tobacco license holder vary from state to state, but some general rules apply to all establishments. These include:
- You cannot sell tobacco products to minors under the age of 21, including military personnel.
Final Thoughts on Getting and Maintaining a Retail Tobacco License
Even with the implementation of strict regulations and state-wide smoking bans in enclosed public areas, nearly 40 million U.S. adults smoke cigarettes.[14]Centers for Disease Control. “Smoking and Tobacco Use”. Accessed March 16, 2022. Thus starting a tobacco business or adding tobacco products to a retail business remains a lucrative addition to business operations.
Once you’ve obtained a retail tobacco license and tobacco merchant account, you’ll be well on your way to expanding your potential customer base to include 40 million more customers.
