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Council briefed on ordinance to move cigarette-tax administration to commissioner of the revenue
Summary
City staff asked council to update the city code so administration and oversight of the local cigarette tax is handled by the commissioner of the revenue rather than the director of finance; staff said the change reflects current practice and would be scheduled for adoption at a future council meeting.
City staff told Roanoke City Council they will present an ordinance to amend Article 8, Chapter 32 of the city code to transfer responsibility for administering the local cigarette tax from the director of finance to the commissioner of the revenue.
David Collins, speaking for the city attorney’s office, said the change is intended to update the code to match current practice: the commissioner of the revenue’s office already handles field investigations, seizures and business contacts related to the cigarette tax. “The commissioner of the revenue has been implementing and being responsible for that tax for some time now, and this is just a matter of updating the city code with current practice,” Collins said.
Jonathan Taylor, deputy commissioner of the revenue, told council his office handles on-site investigations and seizures, and that keeping administration in the commissioner’s office simplifies logistics for businesses and staff. Taylor said his office conducts the seizures and fields most questions from retailers.
Councilmember Linda Powers asked about penalties and redemption options for seized product. Taylor and Collins described two outcomes the ordinance contemplates: where evidence indicates deliberate evasion or malfeasance, the ordinance provides for payment of the tax plus a 50% penalty and destruction of the product; where the seizure appears to be the result of error or unfamiliarity with wholesale procedures, a lesser penalty (10% plus tax) could allow for redemption, though local offices do not have tax-appliqué machines and product selected for redemption may still be destroyed in practice.
Collins said staff will present the formal ordinance on the next council agenda for adoption, barring further changes.
The proposed change affects only who is named in the code as the administering officer; it does not create a new tax rate or new substantive tax rules, council was told.
