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How to obtain Cigarette and OTP licenses in the State of Oklahoma
Who is required to obtain cigarettes and tobacco license in Oklahoma?

Any of the below mentioned person who fulfil all the state requirements can apply for cigarette and tobacco license:

  • Any manufacturer who intends to sell cigarettes and OTP to the manufacturer.
  • Any wholesaler who agrees to sell cigarette and OTP to a licensed retailer.
  • Any distributing agent who acts as a liaison between manufacturer and distributor for the purpose of storing, distribution and delivery of tobacco products.
  • Any retailer who comes into the possession of cigarettes and untaxed tobacco products for the purpose of selling at retail.

How to apply for the license to sell tobacco products?

You can apply for a tobacco license by filing the Business registration application on Form 40002 Packet C available on Oklahoma Tax commission site.

License Fee for different applicants are as under:

Manufacturer for Cigarettes and OTP $250
Wholesalers for cigarette and OTP $250
Distributing agent $100
Retailer for cigarette and OTP $30

What is the validity period of the licenses?

Licenses are valid for the following period for different tobacco dealers:

Wholesalers 1 year
Manufacturer 1 year
Distributing agent 1 year
Retailer 3 years
Licenses can be renewed in the same form on their expiry with Oklahoma Tax commission along with the appropriate renewal fee.

Please note that each wholesaler, manufacturer, distributor and retailer licenses is valid for one business location only and you have to apply for different location along with the separate licensing fee for each location.

Which tobacco licenses require submission of surety amount?

All cigarette and tobacco products wholesalers and distributing agents are required to submit a surety in the amount of $25,000. Bonds may be in the form of cash, surety bond, certificate of deposit, certificate of savings, U.S. Treasury Bonds, or other securities as the Commission considers acceptable.

Surety bonds must be in the form BT-157 available on the Commission website.

Certificates of deposit are made in the name of the holder and Oklahoma Commission.

Certificates of savings must be accompanied by a pledge of account.

All the above mentioned forms for surety purpose are available on the Commission website.

What are the requirements for vehicles, tobacco licenses?

Every wholesaler who is in the business of selling cigarette and OTP through a Vehicle which is considered its place of business for the purpose of his or her business, then he or she is required to obtain a wholesaler vehicle license for that business.

Please note that if the vehicle is owned and operated by a place of business for which $250 license fee has already been paid by the wholesaler, then he or she will be required to pay $10 for the additional vehicle license.

Responsibilities of Tobacco Retailer:

  • It is the retailer‘s duty to post and display all licenses on the licensed premises in plain view of the general public and shall exhibit same to any person upon request.
  • The retailer should keep records of all invoices and equivalent documentation of cigarettes and tobacco products at each licensed location.
  • The retailer should purchase an inventory of cigarettes from a licensed tobacco distributor and wholesaler in the State of Oklahoma.
  • The retailer can only sell those tobacco products, which have a paid tax stamp affixed to them.

What are the tax rates on a cigarette and OTP in the State of Oklahoma?

  • Tax rate on cigarette is $ 1.03 per pack of 20 cigarettes plus $1.5 wholesaler fee.
  • Tax rate on cigars:
    • Class A cigars: $0.036 per cigar
    • Class B cigar: $0.10 each
    • Class C cigar: $0.12 each
  • Smoking tobacco: 80% of the factory list price.
  • Chewing Tobacco: 605 of the factory list price.
The Abovementioned tax rate is an Oklahoma state tax imposed on tobacco products. There is an additional tax imposed on these products on federal level too.

Who is required to file the return of tax and income for cigarette and tobacco products?

Every manufacturer, wholesaler and distributing agent who is in possession of the cigarette and tobacco products for trade and business are required to file return of income on 20th of every month. Returns are filed electronically on Oklahoma tax Commission website.

For cigarettes, tax is due when the stamp is purchased and for OTP products, wholesalers pay the tax when the product is shipped into the state.

What are the penalties for non-payment of tax?

If you are unable to pay due taxes on time, you will be charged with an interest amount calculated at the rate of 1.25% per month of the unpaid tax. If any amount of tobacco tax is not paid within 30 days the penalty is 10% of the total amount of delinquent tax.

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