Current tobacco tax rates
Oregon voters passed Measure 108, which included a tax on inhalant delivery systems, changing the way little cigars are taxed, and increasing the cigar tax cap to $1 per cigar. The tax rates are:
- Cigars - 65 percent of the wholesale sales price. The maximum tax is $1 per cigar. Little cigars collectively weighing 3 pounds or less per 1,000 are considered cigarettes for taxation purposes. Please see cigarette tax overview to read more about Oregon's cigarette and little cigar tax laws.
- Moist snuff - $1.80 per ounce. The minimum tax is $2.17 per retail container. Moist snuff includes any form of tobacco that is not intended to be smoked or placed in the nasal cavity. Effective July 1, 2024, the tax rate for moist snuff will increase to $1.86 per ounce and the minimum tax will increase to $2.24 per retail container.
- All other tobacco products, including inhalant delivery systems - 65 percent of the wholesale sales price.
Tobacco products include inhalant delivery systems, cigars, smokeless tobacco (snuff, chewing tobacco, snus, dissolvable products containing tobacco, etc.), blunt wraps, pipe tobacco, shisha, roll-your-own, and any other kinds and forms of tobacco that can be chewed or smoked, except cigarettes and little cigars.
Only smokeless tobacco products listed on the Oregon Department of Justice Smokeless Tobacco Brand Directory can be sold in Oregon. Products not listed on the directory are contraband and are subject to seizure. Smokeless tobacco products include moist snuff and chewing tobacco.
Steps to apply for a distributor or wholesale license
If you are a tobacco retailer seeking information regarding a tobacco retail license, please visit the
tobacco retail licensing page for more information.
Most businesses must be registered with the Secretary of State's office. Register online or call the Secretary of State's Corporation Division at 503-986-2200.
All businesses, except certain sole proprietorships, are required to have a federal tax identification number. Download the IRS SS-4 form to get started or contact your local IRS office if you have questions.
There are three kinds of licenses:
- Tobacco Products Distributor's License: For people who bring untaxed tobacco products into Oregon for resale.
- Cigarette Distributor's License: For people who bring untaxed cigarettes into Oregon for resale. This license allows you to purchase Oregon tax stamps from us.
- Cigarette Wholesaler's License: sale For people who buy stamped cigarettes from licensed distributors. This license allows you to resell these cigarettes to other retailers.
You must list the names, addresses, and contact information of all suppliers and manufacturers from which you purchase tobacco. Your application can't be processed without this information.
Complete and submit your application electronically using
Revenue Online. Navigate to and select “Apply for cigarette and tobacco license" at the bottom right of the page, and then select “Apply for distributor/wholesale license" to fill out the online application.
There is no fee for a distributor or wholesale license in Oregon. We usually process applications within four to six weeks. We'll mail your license to your business, and you must display it publicly.
Distributors are required to post security in the form of a surety bond to ensure compliance with the tobacco tax laws. The department will contact you to determine the bond amount and provide additional information on how to obtain the surety bond during the review process after an application has been submitted.
Frequently asked questions
If you buy untaxed tobacco products then you are responsible for paying the tax, whether you are a business or have purchased the tobacco products for personal use.
Retailers
You must purchase tobacco products from licensed Oregon distributors who have paid the tax. If you want to purchase untaxed tobacco products and sell them to customers in Oregon, you must apply for a distributor's license. Click here for a list of the
currently licensed Oregon distributors.
You must keep receipts and invoices for tobacco products for five years, or until the products are sold, whichever is longer. Receipts and invoices must be available for inspection by us. Read more about the
inspection process.
Consumers
If you purchase untaxed tobacco products, you're responsible for paying the tax. You must file an
Oregon Unlicensed Tobacco Quarterly Tax Return, Form 531, for every quarter you purchase untaxed tobacco products. This can be done through Revenue Online by selecting “File a return" and choosing “File Form 531", or by using the form listed on our
Forms Page.
Transporters
You must apply for a Permit for Transportation of Untaxed Tobacco Products to possess, acquire for transportation, or transport untaxed tobacco products in Oregon. You can complete and submit an application for a Permit for Transportation of Untaxed Tobacco Products electronically using Revenue Online. From Revenue Online, select “Transport Untaxed Tobacco" to start the application process.
You need an Oregon Distributor License before distributing tobacco products in Oregon. You must be licensed for each location where you sell tobacco products. Distributor licenses are non-transferable. Read more about the licensing process.
We'll charge a penalty of 5 percent of the amount due for any failure to file a report or return or failure to pay the tax by the due date. If the amount due isn't paid within 30 days, we'll charge an additional 20 percent penalty. Interest is added to any unpaid amount, calculated from the time the tax becomes due. Interest will be at the rate established under Oregon law. Additionally, you may be subject to a civil penalty of up to $1,000 per violation of state other tobacco products tax laws.
You will owe tax to the state if you purchase untaxed tobacco from the internet or other sources.
Use the Oregon Unlicensed Tobacco Quarterly Tax Return, Form OR-531 to report purchases of untaxed tobacco. For every calendar quarter you purchase untaxed tobacco products, you must file a return by the last day of the month following each quarterly reporting period. Quarterly returns are due on or before the last day of January, April, July, and October. Tax payment must be sent with the return.
For more information about this tax, read the Oregon Revised Statutes and Oregon Administrative Rules.
Examples of taxable inhalant delivery system products are:
- E-cigarettes (reusable and disposable).
- Vape products, vape devices, and components.
- Liquid or e-juice, regardless of whether or not it contains nicotine.
- Vape devices, including tobacco and hookahs (does not include devices marketed or sold solely for the purpose of vaporizing or aerosolizing marijuana products).
Delivery inhalant system products not subject to Oregon tobacco tax include:
- Battery chargers, if sold separately.
- Lanyards or straps, if sold separately.
- Any product that has been approved by the U.S. Food and Drug Administration for sale as a tobacco cessation product or for any other therapeutic purpose, if the product is marketed and sold solely for the approved purpose.
Marijuana items as defined in ORS 475C.009
You must pay the tax for any untaxed tobacco products
that you bring into Oregon. Additionally, you must complete and submit an
Oregon tobacco products tax return. If you are an Oregon-licensed distributor,
you must file an Oregon Quarterly Tax Return for Tobacco Distributors,
Form 530.
If you are not an Oregon-licensed distributor, you must file an Oregon Unlicensed Tobacco Quarterly Tax Return,
Form 531.
You also need to be sure that your importing activities are approved by the
Alcohol and Tobacco Tax and Trade Bureau. For more information, visit
www.ttb.gov.
For tobacco received by an in-state distributor:
- Tobacco received from out-of-state sources: The in-state distributor is liable for Tobacco Products Tax and should report the product on the Form OR-530.
- Tobacco received from another in-state distributor: The first distributor to receive the tobacco products in Oregon is liable for the Tobacco Products Tax.
For tobacco sold by an out-of-state distributor:
- Sales to retailers and consumers within Oregon: The out-of-state distributor is liable for Tobacco Products Tax and should report the product on the Form OR-530.
- Sales to a licensed distributor within Oregon: The out-of-state distributor is not liable for Tobacco Products Tax and should not report the product on the form OR-530.