Tobacco products and cigarette papers
and tubes manufactured in or imported into the United States are
subject to a Federal excise tax under the IRC at 26 U.S.C. 5701.
However, pursuant to 26 U.S.C. 5704(b), manufacturers of tobacco
products or cigarette papers and tubes may remove such articles,
without payment of tax, "for use of the United States" under such
regulations as the Secretary shall prescribe. In addition, under 26
U.S.C. 5741, all manufacturers and importers of tobacco products or
cigarette papers and tubes are required to keep such records in
such manner as the Secretary of the Treasury prescribes by
regulation. Under these authorities, the TTB regulations require
manufacturers to keep records related to the removals of tobacco
products or cigarette papers or tubes for use of the United States,
including the date of removal, the name and address of the Federal
agency to which the products are shipped or delivered, the kind and
quantity of products removed and, for large cigars, the sale price.
Records must also be kept detailing any items removed for use of
the United States and returned to the manufacturer. The required
records are necessary to protect the revenue and prevent diversion
of tobacco products by ensuring that the tax exemption is applied
only to products that are delivered to a Federal agency for
government use.
US Code:
26
USC 5741 Name of Law: Internal Revenue Code
US Code: 26
USC 5704(b) Name of Law: Internal Revenue Code
There are no program changes
associated with this collection. As for adjustments, TTB is
increasing the estimated number of annual respondents and responses
for this information collection, but is lowering its estimated
total annual burden. In the past, TTB has estimated that
approximately one-half of all manufacturers of tobacco products or
cigarette papers and tubes removed such articles without payment of
tax for use of the United States. However, because TTB does not
audit or investigate every such manufacturer each year, TTB cannot
accurately estimate the number of annual respondents to this
recordkeeping requirement. Therefore, TTB is now reporting that all
of the estimated 205 manufacturers of tobacco products and
cigarette papers and tubes that TTB regulates respond to this
recordkeeping requirement an average of once per year. Therefore,
TTB is increasing the annual estimated number of respondents and
responses from 101 to 205. However, TTB is decreasing the estimated
annual burden associated with this information collection from 505
hours (5 hours per response) to 205 hours (1 hour per response).
TTB notes that respondents may use commercial records, including
automated and electronic records, to keep the required information.
Therefore, TTB believes the use of modern computerized
recordkeeping systems has reduced the burden associated with this
recordkeeping requirement.
$0
No
No
No
No
No
No
Uncollected
Jesse Longbrake 202
453-2265
No
On behalf of this Federal agency, I certify that
the collection of information encompassed by this request complies
with 5 CFR 1320.9 and the related provisions of 5 CFR
1320.8(b)(3).
The following is a summary of the topics, regarding
the proposed collection of information, that the certification
covers:
(i) Why the information is being collected;
(ii) Use of information;
(iii) Burden estimate;
(iv) Nature of response (voluntary, required for a
benefit, or mandatory);
(v) Nature and extent of confidentiality; and
(vi) Need to display currently valid OMB control
number;
If you are unable to certify compliance with any of
these provisions, identify the item by leaving the box unchecked
and explain the reason in the Supporting Statement.
1513-0069 Supporting Statement (10-2017).docx
Tobacco Products Manufacturers - Supporting Records for Removals for the Use of the United States