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.
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