Amends and adds to existing law to establish certain permitting requirements regarding the sale of certain nicotine products, to revise provisions regarding the regulation of certain nicotine products, and to impose a tax on certain nicotine and related products.

LEGISLATURE OF THE STATE OF IDAHO Sixty-eighth Legislature Second Regular Session - 2026 IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 884 BY REVENUE AND TAXATION COMMITTEE AN ACT1 RELATING TO NICOTINE PRODUCTS; AMENDING THE HEADING FOR CHAPTER 57, TITLE2 39, IDAHO CODE; AMENDING SECTION 39-5702, IDAHO CODE, TO DEFINE TERMS3 AND TO REVISE A DEFINITION; AMENDING SECTION 39-5703, IDAHO CODE, TO RE-4 VISE PROVISIONS REGARDING POSSESSION, DISTRIBUTION, OR USE BY A MINOR;5 AMENDING SECTION 39-5704, IDAHO CODE, TO PROVIDE FOR CERTAIN PERMIT-6 TING AND TO PROVIDE PENALTIES; AMENDING CHAPTER 57, TITLE 39, IDAHO7 CODE, BY THE ADDITION OF A NEW SECTION 39-5704A, IDAHO CODE, TO ESTAB-8 LISH PROVISIONS REGARDING SALES BETWEEN PERMITTED PERSONS OR ENTITIES9 ONLY; AMENDING CHAPTER 57, TITLE 39, IDAHO CODE, BY THE ADDITION OF A10 NEW SECTION 39-5704B, IDAHO CODE, TO ESTABLISH PROVISIONS REGARDING THE11 PERMITS REQUIRED FOR MANUFACTURERS OF ALTERNATIVE NICOTINE PRODUCTS,12 TOBACCO PRODUCTS, AND ELECTRONIC SMOKING DEVICES; AMENDING CHAPTER13 57, TITLE 39, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 39-5704C,14 IDAHO CODE, TO ESTABLISH PROVISIONS REGARDING AGENTS FOR SERVICE OF15 PROCESS; AMENDING CHAPTER 57, TITLE 39, IDAHO CODE, BY THE ADDITION OF16 A NEW SECTION 39-5704D, IDAHO CODE, TO ESTABLISH PROVISIONS REGARD-17 ING THE BOND REQUIREMENT FOR NONRESIDENT OR FOREIGN MANUFACTURERS OF18 ELECTRONIC SMOKING DEVICES; AMENDING CHAPTER 57, TITLE 39, IDAHO CODE,19 BY THE ADDITION OF A NEW SECTION 39-5704E, IDAHO CODE, TO ESTABLISH20 PROVISIONS REGARDING CERTAIN PENALTIES; AMENDING SECTION 39-5705,21 IDAHO CODE, TO PROHIBIT THE SALE OF ALTERNATIVE NICOTINE PRODUCTS TO22 MINORS; AMENDING SECTION 39-5706, IDAHO CODE, TO PROVIDE THAT ALTERNA-23 TIVE NICOTINE PRODUCTS MAY BE SOLD ONLY THROUGH VENDOR-ASSISTED SALES;24 AMENDING SECTION 39-5707, IDAHO CODE, TO REVISE PROVISIONS REGARDING25 OPENED PACKAGES AND SAMPLES; AMENDING SECTION 39-5708, IDAHO CODE, TO26 REVISE PROVISIONS REGARDING CERTAIN CIVIL PENALTIES FOR VIOLATIONS OF27 A PERMIT; AMENDING SECTION 39-5709, IDAHO CODE, TO REVISE PROVISIONS28 REGARDING CERTAIN CRIMINAL PENALTIES FOR VIOLATIONS WITHOUT A PERMIT;29 AMENDING SECTION 39-5710, IDAHO CODE, TO REVISE PROVISIONS REGARDING30 THE CONDUCT OF CERTAIN ENFORCEMENT ACTIONS; AMENDING SECTION 39-5711,31 IDAHO CODE, TO REVISE PROVISIONS REGARDING FUNDING; AMENDING SECTION32 39-5713, IDAHO CODE, TO REVISE PROVISIONS REGARDING LOCAL ORDINANCES;33 AMENDING SECTION 39-5714, IDAHO CODE, TO REVISE PROVISIONS REGARD-34 ING REQUIREMENTS FOR DELIVERY SALES; AMENDING SECTION 39-5715, IDAHO35 CODE, TO REVISE PROVISIONS REGARDING AGE VERIFICATION REQUIREMENTS;36 AMENDING SECTION 39-5717, IDAHO CODE, TO REVISE PROVISIONS REGARDING37 SHIPPING REQUIREMENTS; AMENDING SECTION 39-5718, IDAHO CODE, TO RE-38 VISE PROVISIONS REGARDING REGISTRATION AND REPORTING REQUIREMENTS;39 AMENDING SECTION 39-8421, IDAHO CODE, TO PROVIDE A CORRECT CODE REFER-40 ENCE; AMENDING SECTION 56-227F, IDAHO CODE, TO PROVIDE A CORRECT CODE41 REFERENCE; AMENDING THE HEADING FOR CHAPTER 25, TITLE 63, IDAHO CODE;42 AMENDING SECTION 63-2551, IDAHO CODE, TO REVISE DEFINITIONS AND TO43 DEFINE TERMS; AMENDING SECTION 63-2552B, IDAHO CODE, TO REVISE PROVI-44 SIONS REGARDING USE TAXES; AMENDING CHAPTER 25, TITLE 63, IDAHO CODE,45

2 BY THE ADDITION OF A NEW SECTION 63-2552C, IDAHO CODE, TO PROVIDE FOR1 A TAX ON THE SALE OF ALTERNATIVE NICOTINE PRODUCTS AND VAPOR PRODUCTS2 AND TO PROVIDE FOR THE DISTRIBUTION CERTAIN REVENUE; AMENDING SECTION3 63-2553, IDAHO CODE, TO REVISE LEGISLATIVE INTENT; AMENDING SECTION4 63-2554, IDAHO CODE, TO REVISE PROVISIONS REGARDING PERMITS REQUIRED;5 AMENDING SECTION 63-2555, IDAHO CODE, TO REVISE PROVISIONS REGARDING6 BOOKS AND RECORDS TO BE PRESERVED AND ENTRY AND INSPECTION BY THE STATE7 TAX COMMISSION; AMENDING SECTION 63-2556, IDAHO CODE, TO REVISE PROVI-8 SIONS REGARDING THE PRESERVATION OF INVOICES OF SALES; AMENDING SECTION9 63-2557, IDAHO CODE, TO REVISE A PROVISION REGARDING INVOICES; AMENDING10 SECTION 63-2558, IDAHO CODE, TO REVISE PROVISIONS REGARDING RECORDS;11 AMENDING SECTION 63-2559, IDAHO CODE, TO REVISE PROVISIONS REGARDING12 WHEN CREDIT MAY BE OBTAINED FOR TAX PAID; AMENDING SECTION 63-2563,13 IDAHO CODE, TO REVISE PROVISIONS REGARDING COLLECTION AND ENFORCEMENT;14 AMENDING SECTION 63-2565, IDAHO CODE, TO REVISE A PROVISION REGARDING15 REFUNDS; AND DECLARING AN EMERGENCY AND PROVIDING AN EFFECTIVE DATE.16

Be It Enacted by the Legislature of the State of Idaho:17

SECTION 1. That the Heading for Chapter 57, Title 39, Idaho Code, be,18 and the same is hereby amended to read as follows:19 CHAPTER 5720 PREVENTION OF MINORS' ACCESS TO ALTERNATIVE NICOTINE PRODUCTS, TOBACCO21 PRODUCTS, OR ELECTRONIC SMOKING DEVICES22

SECTION 2. That Section 39-5702, Idaho Code, be, and the same is hereby23 amended to read as follows:24 39-5702. DEFINITIONS. The terms used in this chapter are defined as25 follows:26 (1) "Alternative nicotine product" means a noncombustible product27 that contains nicotine or a nicotine analog, whether natural or synthetic,28 but does not contain tobacco and is intended for human consumption, whether29 chewed, absorbed, dissolved, ingested, or by other means. This term shall30 not include a vapor product, tobacco product, or any product regulated by the31 United States food and drug administration under chapter V of the federal32 food, drug, and cosmetic act.33 (1) (2) "Business" means any company, partnership, firm, sole propri-34 etorship, association, corporation, organization, or other legal entity, or35 a representative of the foregoing entities.36 (2) (3) "Delivery sale" means to distribute tobacco products or elec-37 tronic smoking devices to a consumer in a state where either:38 (a) The individual submits the order for such sale by means of a39 telephonic or other method of voice transmission, data transfer via40 computer networks, including the internet and other online services, or41 facsimile, or the mails; or42 (b) The tobacco products or electronic smoking devices are delivered by43 use of the mails or a delivery service.44 (3) (4) "Delivery service" means any person who is engaged in the com-45 mercial delivery of letters, packages or other containers.46

3 (4) (5) "Department" means the state department of health and welfare1 or its duly authorized representative.2 (5) (6) "Distribute" means to give, deliver, sell, offer to give, offer3 to deliver, offer to sell or cause any person to do the same or hire any person4 to do the same.5 (7) "Distributor" means:6 (a) Any person engaged in the business of selling alternative nicotine7 products, tobacco products, or electronic smoking devices in this state8 who brings, or causes to be brought, into this state from outside the9 state any such products for sale;10 (b) Any person who makes, manufactures, or fabricates alternative11 nicotine products, tobacco products, or electronic smoking devices in12 this state for sale in this state; and13 (c) Any person engaged in the business of selling alternative nicotine14 products, tobacco products, or electronic smoking devices outside this15 state who ships or transports such products to retailers in this state16 to be sold by those retailers.17 (8) "Electronic smoking device" means any nonlighted, noncombustible18 product that employs a mechanical heating element, battery, or electronic19 circuit regardless of shape or size and that can be used to produce vapor20 from nicotine or a nicotine analog, however derived, in a solution. The term21 includes any vapor cartridge or other container of nicotine in a solution or22 other form that is intended to be used with or in an electronic cigarette,23 electronic cigar, electronic cigarillo, electronic pipe, or similar product24 or device. The term does not include any product regulated by the United25 States food and drug administration under chapter V of the federal food,26 drug, and cosmetic act.27 (6) (9) "Location" means the street address where tobacco or electronic28 smoking device products are sold or the uniform resource locator for retail-29 ers who sell tobacco or electronic smoking products exclusively via the in-30 ternet.31 (10) "Manufacturer" means a person who manufactures and sells alterna-32 tive nicotine products, tobacco products, or electronic smoking devices.33 (7) (11) "Minor" means a person under twenty-one (21) years of age.34 (8) (12) "Minor-exempt permit" means a permittee location whose rev-35 enues from the sale of alcoholic beverages for on-site consumption comprises36 at least fifty-five percent (55%) of total revenues, or whose products and37 services are primarily obscene, pornographic, profane, or sexually ori-38 ented, is exempt from inspections assisted by a minor, if minors are not39 allowed in the location and such prohibition is posted clearly on all en-40 trance doors.41 (13)(a) "Nicotine analog" means a substance:42 (i) The chemical structure of which is substantially similar to43 the chemical structure of nicotine; or44 (ii) That has, purports to have, or is represented to have, an ef-45 fect on the central nervous system that is similar to or greater46 than the effect on the central nervous system as nicotine.47 (b) Factors relevant to determining whether a substance is a nicotine48 analog include but are not limited to the marketing, advertising, and49 labeling of the substance and whether the substance has been manufac-50

4 tured, formulated, sold, distributed, or marketed with the intent to1 avoid the provisions of this chapter and other provisions of law.2 (9) (14) "Permit" means a permit issued by the department for the sale or3 distribution of tobacco products or electronic smoking devices.4 (10) (15) "Permit endorsement" means a sale or delivery method used by5 the permittee to sell tobacco or electronic smoking device products, includ-6 ing delivery sales, delivery service, and direct sales.7 (11) (16) "Permittee" means the holder of a valid permit for the sale or8 distribution of tobacco products or electronic smoking devices.9 (12) (17) "Photographic identification" means state, district, terri-10 torial, possession, provincial, national or other equivalent government11 driver's license, identification card or military card, in all cases bearing12 a photograph and a date of birth, or a valid passport.13 (13) (18) "Random, unannounced inspection" means an inspection of re-14 tail outlets by a law enforcement agency or by the department, with or with-15 out the assistance of a minor, to monitor compliance of this chapter.16 (19) "Retailer" means any person engaged in the business of selling17 alternative nicotine products, tobacco products, or electronic smoking de-18 vices to ultimate consumers.19 (14) (20) "Seller" means the person who physically sells or distributes20 tobacco products or electronic smoking devices.21 (15) (21)(a) "Tobacco product or electronic smoking device" means:22 (i) Any substance containing, made of, or derived from tobacco23 or nicotine that is intended for human consumption or is likely to24 be consumed, whether inhaled, absorbed, or ingested by any other25 means, including but not limited to cigarettes, cigars, pipes,26 snuff, smoking or chewing tobacco, snus, tobacco papers, or smoke-27 less tobacco; or28 (ii) Any electronic smoking device that may be used to deliver an29 aerosolized or a vaporized substance to the person inhaling from30 the device, including but not limited to an electronic cigarette,31 an electronic cigar, an electronic pipe, a vape pen, or an elec-32 tronic hookah, or any component, part, or accessory of such a33 device, or any substance intended to be aerosolized or vaporized34 during use of the device, whether or not the substance contains35 nicotine, or any heated or lighted device intended to be used for36 inhalation; or37 (iii) (ii) Any components, parts, or accessories of a tobacco38 product or an electronic smoking device, whether or not they con-39 tain tobacco or nicotine, including but not limited to filters,40 rolling papers, blunt or hemp wraps, and pipes, whether manufac-41 tured, distributed, marketed, or sold as an electronic cigarette,42 electronic cigar, electronic hookah, or vape pen, or under any43 other product name or descriptor.44 (b) The term "tobacco product or electronic smoking device" does not45 include alternative nicotine products or drugs, devices, or combina-46 tions of products authorized for sale by the United States food and drug47 administration as those terms are defined in the federal food, drug, and48 cosmetic act.49

5 (16) (22) "Vending machine" means any mechanical, electronic, or other1 similar device that, upon the insertion of tokens, money or any other form of2 payment, dispenses tobacco products or electronic smoking devices.3 (17) (23) "Vendor-assisted sales" means any sale or distribution in4 which the customer has no access to the product except through the assistance5 of the seller.6 (18) (24) "Without a permit" means a business that has failed to obtain a7 permit or a business whose permit is suspended or revoked.8

SECTION 3. That Section 39-5703, Idaho Code, be, and the same is hereby9 amended to read as follows:10 39-5703. POSSESSION, DISTRIBUTION, OR USE BY A MINOR. (1) It shall11 be unlawful for a minor to possess, receive, purchase, use, or consume12 alternative nicotine products, tobacco products, or electronic smoking de-13 vices or to attempt any of the foregoing.14 (2) It shall be unlawful for a minor to sell or distribute alternative15 nicotine products, tobacco products, or electronic smoking devices or to at-16 tempt either of the foregoing.17 (3) It shall be unlawful for a minor to provide false identification18 or make any false statement regarding their age in an attempt to obtain19 alternative nicotine products, tobacco products, or electronic smoking de-20 vices.21 (4) A minor who is assisting with a random unannounced inspection in ac-22 cordance with this chapter shall not be in violation of this chapter.23 (5) A minor may possess but not sell or distribute alternative nico-24 tine products, tobacco products, or electronic smoking devices in the course25 of employment, for duties such as stocking shelves or carrying purchases to26 customers' vehicles.27 (6) Penalties for violations by a minor. A violation of subsection (1)28 of this section by a minor shall constitute an infraction and shall be pun-29 ishable by a fine of seventeen dollars and fifty cents ($17.50). The first30 violation of subsection (2) or (3) of this section by a minor shall consti-31 tute an infraction and shall be punishable by a fine of two hundred dollars32 ($200). A subsequent violation of subsection (2) or (3) of this section by a33 minor shall constitute a misdemeanor and shall be punishable by imprisonment34 in an appropriate facility not exceeding thirty (30) days, a fine not exceed-35 ing three hundred dollars ($300), or both such fine and imprisonment. The36 court may, in addition to the penalties provided in this section, require the37 minor and, if the minor is under eighteen (18) years of age, the minor's par-38 ents or legal guardian to attend alternative nicotine product, tobacco prod-39 uct, or and electronic smoking device awareness programs or to perform com-40 munity service in programs related to alternative nicotine product, tobacco41 product, or and electronic smoking device awareness.42

SECTION 4. That Section 39-5704, Idaho Code, be, and the same is hereby43 amended to read as follows:44 39-5704. PERMITTING OF ALTERNATIVE NICOTINE PRODUCTS, TOBACCO PROD-45 UCTS, OR AND ELECTRONIC SMOKING DEVICES RETAILERS. (1) It shall be unlawful46 to sell or distribute or offer alternative nicotine products, tobacco prod-47

6 ucts, or electronic smoking devices for sale or distribution at retail or1 to possess alternative nicotine products, tobacco products, or electronic2 smoking devices with the intention of selling at retail without having first3 obtained a tobacco product or electronic smoking device permit from the4 department, which shall be the only retail alternative nicotine products,5 tobacco product, or electronic smoking device permit or license required.6 Provided however, this section shall not be deemed to require a wholesaler7 or manufacturer's representative or employees who, in the course of their8 employment, stock shelves and replenish alternative nicotine products,9 tobacco products, or electronic smoking devices at a permittee's place of10 business to obtain a permit.11 (2) The department shall administer the permitting of alternative12 nicotine product, tobacco product, or electronic smoking device retailers13 and shall be authorized to ensure compliance with this chapter.14 (3) Permits shall be issued annually for each permanent business loca-15 tion to ensure compliance with the requirements of this chapter. A copy of16 signage required by this chapter, and any other materials deemed necessary17 shall be provided with each permit issued.18 (4) A separate permit must be obtained for each place of business and is19 nontransferable to another person, business, or location.20 (5) The applicant shall select one (1) or more permit endorsements and21 make the permit available upon request.22 (6) A permittee may display a sign in each location within a place of23 business where alternative nicotine products, tobacco products, or elec-24 tronic smoking devices are sold or distributed. A sign may be clearly25 visible to the customer and the seller and shall state: "STATE LAW PROHIBITS26 THE SALE OF ALTERNATIVE NICOTINE PRODUCTS, TOBACCO PRODUCTS, OR ELECTRONIC27 SMOKING DEVICES TO PERSONS UNDER THE AGE OF TWENTY-ONE (21) YEARS. PROOF OF28 AGE REQUIRED. ANYONE WHO SELLS OR DISTRIBUTES ALTERNATIVE NICOTINE PROD-29 UCTS, TOBACCO PRODUCTS, OR ELECTRONIC SMOKING DEVICES TO A PERSON UNDER30 THE AGE OF TWENTY-ONE (21) YEARS IS SUBJECT TO STRICT FINES AND PENALTIES.31 PERSONS UNDER THE AGE OF TWENTY-ONE (21) YEARS ARE SUBJECT TO FINES AND32 PENALTIES."33 (7) Permittees are responsible to educate employees as to the require-34 ments of this chapter and retain forms signed by each employee stating that35 the employee understands such requirements.36 (8) It shall be unlawful for the permittee to allow employees who are37 minors to sell or distribute alternative nicotine products, tobacco prod-38 ucts, or electronic smoking devices, except as provided in this subsection.39 Employees who are minors may possess but not sell or distribute alternative40 nicotine products, tobacco products, or electronic smoking devices in the41 course of employment, for such duties as stocking shelves or carrying pur-42 chases to customers' vehicles, and employees who are eighteen (18) years43 to twenty (20) years of age may sell or distribute alternative nicotine44 products, tobacco products, or electronic smoking devices in the course and45 scope of their employment.46 (9) A permit shall be closed when the permittee closes the business, no47 longer sells alternative nicotine products, tobacco products, or electronic48 smoking device products devices, moves to a different physical location, or49 sells the business.50

7 (10) A permit shall be revoked when it is determined that a permit was1 fraudulently obtained to avoid penalties on an existing permit.2 (11) All permits expire annually at midnight on December 31 unless re-3 newed. The department shall mail notice of renewal for permits at least4 ninety (90) days prior to expiration.5 (12) The department may deny an application and refuse to issue or renew6 a permit or may suspend or revoke a permit issued to any person, partnership,7 corporation, limited liability company, or business trust upon determining8 that the licensee or the principals or managers at the permitted location of9 the applicant or permittee have been:10 (a) Found guilty of any fraud or misrepresentation in connection with11 an application filed pursuant to this section;12 (b) Convicted of robbery, extortion, burglary, larceny, embezzlement,13 fraudulent conversion, gambling, perjury, bribery, treason, tax eva-14 sion, or racketeering; or15 (c) Convicted of a felony within the last five (5) years.16 (13) The department may deny an application and refuse to issue or renew17 a permit if there is a reasonable basis to determine the application is filed18 by a person as subterfuge for a different party of interest whose permit has19 previously been denied, canceled, or revoked for cause or a violation under20 this chapter.21

SECTION 5. That Chapter 57, Title 39, Idaho Code, be, and the same is22 hereby amended by the addition thereto of a NEW SECTION, to be known and des-23 ignated as Section 39-5704A, Idaho Code, and to read as follows:24 39-5704A. SALES BETWEEN PERMITTED PERSONS OR ENTITIES ONLY. (1) Dis-25 tributors and retailers shall purchase alternative nicotine products, to-26 bacco products, and electronic smoking devices only from a manufacturer or27 distributor who has obtained a permit under chapter 25, title 63, Idaho Code,28 and shall verify that such seller holds a valid permit before making a pur-29 chase.30 (2) Manufacturers and distributors shall sell alternative nicotine31 products, tobacco products, and electronic smoking devices only to a dis-32 tributor or retailer who has obtained a permit under this chapter or chapter33 25, title 63, Idaho Code, and shall verify that the purchaser holds a valid34 permit before making a sale.35

SECTION 6. That Chapter 57, Title 39, Idaho Code, be, and the same is36 hereby amended by the addition thereto of a NEW SECTION, to be known and des-37 ignated as Section 39-5704B, Idaho Code, and to read as follows:38 39-5704B. PERMITTING OF MANUFACTURERS OF ALTERNATIVE NICOTINE PROD-39 UCTS, TOBACCO PRODUCTS, AND ELECTRONIC SMOKING DEVICES. (1) Every manufac-40 turer of alternative nicotine products, tobacco products, and electronic41 smoking devices that are sold in this state, whether directly or through a42 distributor, retailer, or similar intermediary shall obtain from the de-43 partment a manufacturer permit. A manufacturer of alternative nicotine44 products, tobacco products, or electronic smoking devices that already45 holds a wholesaler or distributor permit shall also separately obtain a man-46 ufacturer permit. The permit is nontransferable.47

8 (2) Each application for a manufacturer permit shall be accompanied by1 such information as the department may require for the purpose of adminis-2 tering this chapter, and by a one-time fee of fifty dollars ($50.00).3 (3) A person or entity that obtains a permit under this chapter has es-4 tablished minimum contacts with the state and consents to the exercise of5 personal jurisdiction over the person or entity in the courts of this state6 in any matter or issue arising under this chapter or related to the sale or7 distribution of alternative nicotine products, tobacco products, and elec-8 tronic smoking devices.9 (4) The department shall maintain a website that identifies all per-10 mitted entities, including information regarding permits that have been re-11 voked or suspended.12

SECTION 7. That Chapter 57, Title 39, Idaho Code, be, and the same is13 hereby amended by the addition thereto of a NEW SECTION, to be known and des-14 ignated as Section 39-5704C, Idaho Code, and to read as follows:15 39-5704C. AGENT FOR SERVICE OF PROCESS. (1) Any nonresident or foreign16 manufacturer of electronic smoking devices that has not registered to do17 business in this state as a foreign corporation or business entity shall,18 as a condition to receiving an electronic smoking device permit under this19 chapter, appoint and continually engage without interruption the services20 of an agent in this state to act as agent for the service of process on whom21 all process, and any action or proceeding against such manufacturer con-22 cerning or arising out of the enforcement of this chapter, may be served in23 any manner authorized by law. Such service shall constitute legal and valid24 service of process on the manufacturer. The manufacturer shall provide the25 name, address, telephone number, and proof of the appointment and availabil-26 ity of such agent to the department.27 (2) The electronic smoking device manufacturer shall provide notice to28 the department thirty (30) calendar days prior to termination of the author-29 ity of an agent and shall further provide proof to the satisfaction of the30 department of the appointment of a new agent no less than five (5) calendar31 days prior to the termination of an existing agent appointment. In the event32 an agent terminates an agency appointment, the manufacturer shall notify the33 department of the termination within five (5) calendar days and shall in-34 clude proof to the satisfaction of the department of the appointment of a new35 agent.36 (3) Any electronic smoking device manufacturer whose products are37 sold in this state without appointing or designating an agent as required38 in this section shall be deemed to have appointed the secretary of state as39 such agent and may be proceeded against in courts of this state by service of40 process upon the secretary of state; however, the appointment of the secre-41 tary of state as such agent shall not satisfy the condition for obtaining an42 electronic smoking device manufacturer permit.43

SECTION 8. That Chapter 57, Title 39, Idaho Code, be, and the same is44 hereby amended by the addition thereto of a NEW SECTION, to be known and des-45 ignated as Section 39-5704D, Idaho Code, and to read as follows:46

9 39-5704D. BOND REQUIREMENT FOR NONRESIDENT OR FOREIGN MANUFACTURERS1 OF ELECTRONIC SMOKING DEVICES. (1) Any nonresident or foreign manufacturer2 of electronic smoking devices that has not registered to do business in3 the state as a foreign corporation or business entity shall, as a condition4 precedent to receiving an electronic smoking device permit, submit to the5 department a surety bond or other cash security payable to the state in the6 amount of twenty-five thousand dollars ($25,000). The bond shall be posted7 by a corporate surety located within the United States. Whenever it is the8 opinion of the department that the bond given by a permittee is inadequate9 in amount to fully protect the state, the department shall require an addi-10 tional bond in such amount as the department deems sufficient.11 (2) The bond shall be conditioned on the performance by the electronic12 smoking device manufacturer of all requirements and obligations imposed by13 this section. A surety on a manufacturer's bond shall be liable up to the14 amount of the bond, and the state may execute on such surety bond for the pay-15 ment of fines and penalties imposed on the manufacturer under this chapter16 and for the costs of seizure and destruction of products sold in violation of17 this chapter. If the state executes on the surety bond, it may require the18 manufacturer to provide an additional bond as a condition precedent for re-19 taining the electronic smoking device manufacturer permit.20 (3) A surety on a bond furnished by an electronic smoking device manu-21 facturer as provided in this section shall be released and discharged from22 liability to the state accruing on the bond after expiration of sixty (60)23 days from the date upon which such surety lodges with the department a writ-24 ten request to be released and discharged. This provision shall not operate25 to relieve, release, or discharge the surety from liability already accrued26 or that accrues before the expiration of the sixty (60) day period. The de-27 partment shall, upon receiving any such request, notify the manufacturer who28 furnished the bond. Unless the manufacturer, on or before the expiration29 of the sixty (60) day period, files with the department a new bond, with the30 surety approved by and acceptable to the department, the department shall31 cancel the manufacturer's electronic smoking device manufacturer permit.32

SECTION 9. That Chapter 57, Title 39, Idaho Code, be, and the same is33 hereby amended by the addition thereto of a NEW SECTION, to be known and des-34 ignated as Section 39-5704E, Idaho Code, and to read as follows:35 39-5704E. PENALTIES. (1) Any person who violates any of the provisions36 of sections 39-5704A through 39-5704D, Idaho Code, shall be subject to the37 following penalties:38 (a) In the case of a first violation, a fine of five hundred dollars39 ($500) per product purchased, sold, or manufactured in violation of40 such sections.41 (b) In the case of a second violation in a two (2) year period, a fine of42 one thousand dollars ($1,000) per product purchased, sold, or manufac-43 tured in violation of such sections, and if the violator holds a permit,44 the permit shall be suspended for seven (7) days.45 (c) In the case of a third violation in a two (2) year period, a fine of46 two thousand dollars ($2,000) per product purchased, sold, or manufac-47 tured in violation of such sections, and if the violator holds a permit,48 the permit shall be suspended for thirty (30) days.49

10 (d) In the case of a fourth violation in a two (2) year period, a fine of1 five thousand dollars ($5,000) per product purchased, sold, or manufac-2 tured in violation of such sections, and if the violator holds a permit,3 the permit shall be revoked.4 (2) A second or subsequent violation of the provisions of sections5 39-5704A through 39-5704D, Idaho Code, constitutes an unfair and deceptive6 act or practice pursuant to chapter 6, title 48, Idaho Code.7 (3) Any electronic smoking devices offered for sale in violation of the8 provisions of this chapter are hereby declared to be contraband goods and9 may be seized by the department or an employee of the department, or by any10 peace officer when directed by the department, without a warrant. Said elec-11 tronic smoking devices seized shall be destroyed or otherwise permanently12 disposed of and shall not be subject to resale. Fifteen (15) days' notice of13 the destruction or disposal shall be given. The cost of such seizure and de-14 struction or disposal shall be borne by the person from whom the products are15 seized.16

SECTION 10. That Section 39-5705, Idaho Code, be, and the same is hereby17 amended to read as follows:18 39-5705. SALE OR DISTRIBUTION OF ALTERNATIVE NICOTINE PRODUCTS, TO-19 BACCO PRODUCTS, OR ELECTRONIC SMOKING DEVICES TO A MINOR. (1) It shall be un-20 lawful to sell, distribute, or offer alternative nicotine products, tobacco21 products, or electronic smoking devices to a minor.22 (2) It shall be an affirmative defense that the seller of an alternative23 nicotine product, a tobacco product, or an electronic smoking device to a mi-24 nor in violation of this section had requested, examined, and reasonably re-25 lied upon a photographic identification from such person establishing that26 the person is at least twenty-one (21) years of age prior to selling such27 person an alternative nicotine product, a tobacco product, or an electronic28 smoking device. The failure of a seller to request and examine photographic29 identification from a person under twenty-one (21) years of age prior to the30 sale of an alternative nicotine product, a tobacco product, or an electronic31 smoking device to such person shall be construed against the seller and form32 a conclusive basis for the seller's violation of this section.33

SECTION 11. That Section 39-5706, Idaho Code, be, and the same is hereby34 amended to read as follows:35 39-5706. VENDOR-ASSISTED SALES. (1) It shall be unlawful to sell or36 distribute alternative nicotine products, tobacco products, or electronic37 smoking devices by any means other than vendor-assisted sales where the38 customer has no access to the product except through the assistance of the39 seller.40 (2) It shall be unlawful to sell or distribute alternative nicotine41 products, tobacco products, or electronic smoking devices from vending ma-42 chines or self-service displays.43 (3) Stores with alternative nicotine products, tobacco products, or44 electronic smoking devices comprising at least seventy-five percent (75%)45 of total merchandise are exempt from requiring vendor-assisted sales if mi-46

11 nors are not allowed in the store and such prohibition is posted clearly on1 all entrance doors.2

SECTION 12. That Section 39-5707, Idaho Code, be, and the same is hereby3 amended to read as follows:4 39-5707. OPENED PACKAGES AND SAMPLES. (1) It shall be unlawful to sell5 or distribute alternative nicotine products, tobacco products, or elec-6 tronic smoking devices for commercial purposes other than in the federally7 required sealed package provided by the manufacturer with all the required8 warning labels and health warnings.9 (2) It shall be unlawful to sell or distribute alternative nicotine10 products, tobacco products, or electronic smoking devices for free or below11 the cost of such products to the sellers or distributors of the products for12 commercial or promotional purposes to members of the general public in pub-13 lic places or at public events.14

SECTION 13. That Section 39-5708, Idaho Code, be, and the same is hereby15 amended to read as follows:16 39-5708. CIVIL PENALTIES FOR VIOLATIONS OF PERMIT. (1) Any permittee17 who fails to comply with any part of this chapter regarding the sale or dis-18 tribution of alternative nicotine products, tobacco products, or electronic19 smoking devices shall be subject to a civil penalty as provided in this sec-20 tion or have their permit suspended, pursuant to compliance with the con-21 tested case provisions of the Idaho administrative procedure act, chapter22 52, title 67, Idaho Code, or both.23 (2) If a seller who is not a permittee violates section 39-5705, Idaho24 Code, and sells or distributes alternative nicotine products, tobacco prod-25 ucts, or electronic smoking devices to a minor, then the seller shall be26 fined one hundred dollars ($100).27 (3) In the case of a first violation, the permittee shall be notified in28 writing of penalties to be levied for further violations.29 (4) In the case of a second violation, the permittee shall be fined two30 hundred dollars ($200) and shall be notified in writing of penalties to be31 levied for further violations. For a violation of section 39-5705, Idaho32 Code, the permittee shall not be fined if the permittee can show that a train-33 ing program was in place for the employee and that the permittee has a form34 signed by that employee on file stating that the employee understands the35 alternative nicotine product, tobacco product, or electronic smoking device36 laws dealing with minors and the unlawful purchase of alternative nicotine37 products, tobacco products, or electronic smoking devices, but the permit-38 tee shall be notified in writing of penalties to be levied for any further vi-39 olations. If no such training is in place, the permittee shall be fined two40 hundred dollars ($200).41 (5) In the case of a third violation in a two (2) year period, the42 permittee shall be fined two hundred dollars ($200) and the permit may be43 suspended for up to seven (7) days. If the violation is by an employee, at the44 same location, who was involved in any previous citation for violation, the45 permittee shall be fined four hundred dollars ($400). Effective training46 and employment practices by the permittee, as determined by the department,47

12 shall be a mitigating factor in determining permit suspension. Evidence of1 mitigating factors shall be submitted to the department within ten (10) days2 of the date of violation. Tobacco Alternative nicotine product, tobacco3 product, or electronic smoking device retailers must remove all alternative4 nicotine products, tobacco products, or electronic smoking devices from all5 areas accessible to or visible to the public while the permit is suspended.6 (6) In the case of four (4) or more violations within a two (2) year pe-7 riod, the permittee shall be fined four hundred dollars ($400) and the per-8 mit shall be revoked until such time that the permittee demonstrates an ef-9 fective training plan to the department, but in no case shall the revoca-10 tion be for less than thirty (30) days. Tobacco Alternative nicotine prod-11 uct, tobacco product, or electronic smoking device retailers must remove all12 alternative nicotine products, tobacco products, or electronic smoking de-13 vices from all areas accessible to or visible to the public while the permit14 is revoked.15 (7) All moneys collected for violations pursuant to this section shall16 be remitted to the prevention of minors' access to alternative nicotine17 products, tobacco products, or electronic smoking devices fund created in18 section 39-5711, Idaho Code.19 (8) All fines shall be paid in full prior to renewal of a permit and20 within ten (10) days of the date of the violation.21

SECTION 14. That Section 39-5709, Idaho Code, be, and the same is hereby22 amended to read as follows:23 39-5709. CRIMINAL PENALTIES FOR VIOLATIONS WITHOUT A PERMIT. Sale or24 distribution of alternative nicotine products, tobacco products, or elec-25 tronic smoking devices, or any violation of this chapter, without a permit is26 considered by the state of Idaho as an effort to subvert the state's public27 purpose to prevent minor's minors' access to alternative nicotine products,28 tobacco products, or electronic smoking devices.29 (1) The sale or distribution of alternative nicotine products, tobacco30 products, or electronic smoking devices without a permit shall constitute a31 misdemeanor punishable by imprisonment not exceeding six (6) months in the32 county jail, a fine of three hundred dollars ($300), or by both such fine33 and imprisonment. If the sale or distribution of alternative nicotine prod-34 ucts, tobacco products, or electronic smoking devices was to a minor, the35 fine shall be no less than five hundred dollars ($500) nor more than one thou-36 sand dollars ($1,000). The provisions of this section shall not be applica-37 ble to an employee of the business engaged in the sale of alternative nico-38 tine products, tobacco products, or electronic smoking devices if the sale39 occurred during the course of such employment and the seller does not have an40 ownership interest in the business.41 (2) In addition to the penalties set forth in subsection (1) of this42 section, the court may impose an additional fine of one thousand dollars43 ($1,000) per day beginning the day following the date of citation as long as44 the illegal alternative nicotine products, tobacco products, or electronic45 smoking devices sales or distribution continues. The first seven (7) days of46 additional fines may be suspended, provided that the business or seller is47 able to prove that the business or seller has applied for the permit within48 seven (7) days of the citation.49

13

SECTION 15. That Section 39-5710, Idaho Code, be, and the same is hereby1 amended to read as follows:2 39-5710. CONDUCT OF ENFORCEMENT ACTIONS. (1) It is the intent of the3 legislature that law enforcement agencies, the attorney general, and the4 department shall enforce this chapter in a manner that can reasonably be5 expected to significantly reduce the extent to which alternative nicotine6 products, tobacco products, and electronic smoking devices are sold or dis-7 tributed to minors.8 (2) Law enforcement agencies may conduct random, unannounced inspec-9 tions at locations where alternative nicotine products, tobacco products,10 or electronic smoking devices are sold or distributed to ensure compliance11 with this chapter. A copy of all citations issued under this chapter shall be12 submitted to the department.13 (3) The department shall conduct at least one (1) random, unannounced14 inspection per year at all locations where alternative nicotine products,15 tobacco products, or electronic smoking devices are sold or distributed at16 retail to ensure compliance with this chapter. The department shall conduct17 inspections for minor-exempt permittees without the assistance of a minor.18 The department shall conduct inspections for all other permittees with the19 assistance of a minor. Each year, the department shall conduct random, unan-20 nounced inspections equal to the number of permittees on the last day of the21 calendar year multiplied by the violation percentage rate reported for the22 previous year multiplied by a factor of ten (10). In no instance will the23 number of inspections exceed twice the number of permittees. Local law en-24 forcement agencies are encouraged to contract with the department to perform25 these required inspections.26 (4) Minors may assist with random, unannounced inspections, provided27 that minors under the age of eighteen (18) years must have the written con-28 sent of a parent or legal guardian. When assisting with these inspections,29 minors shall not provide false identification or make any false statement30 regarding their age.31 (5) Citizens may file a written complaint of noncompliance of this32 chapter with the department or with a law enforcement agency. Permit holders33 under 26 U.S.C. 5712 may file written complaints relating to delivery sales34 to the department or the attorney general's offices. Complaints shall be35 investigated and the proper enforcement actions taken.36 (6) Within a reasonable time, not later than two (2) business days after37 an inspection has occurred, a representative of the business inspected shall38 be informed in writing of the results of the inspection.39 (7) The attorney general or his designee, or any person who holds a per-40 mit under 26 U.S.C. 5712, may bring an action in district court in Idaho to41 prevent or restrain violations of this chapter by any person or by any person42 controlling such person.43

SECTION 16. That Section 39-5711, Idaho Code, be, and the same is hereby44 amended to read as follows:45 39-5711. FUNDING AND CREATION OF PREVENTION OF MINORS' ACCESS TO46 ALTERNATIVE NICOTINE PRODUCTS, TOBACCO PRODUCTS, OR ELECTRONIC SMOKING47 DEVICES FUND. There is hereby created the prevention of minors' access to48

14 alternative nicotine products, tobacco products, or electronic smoking de-1 vices fund in the state treasury. Moneys in the fund shall be used to fund the2 administration, inspections and enforcement of this chapter. Moneys in the3 fund may be expended only pursuant to appropriation. The fund shall consist4 of:5 (1) The current federal funds that are available for inspections or for6 the prevention of minors' access to tobacco products or electronic smoking7 devices shall be utilized by the department;8 (2) The fines from the civil penalties pursuant to section 39-5708,9 Idaho Code; and10 (3) Moneys from any other source.11

SECTION 17. That Section 39-5713, Idaho Code, be, and the same is hereby12 amended to read as follows:13 39-5713. LOCAL ORDINANCES PROHIBITED. No local unit of government14 may adopt or enforce requirements for the regulation, marketing, or sale of15 alternative nicotine products, tobacco products, or electronic smoking de-16 vices that are more restrictive than or in addition to this chapter. No local17 unit of government may impose or enforce a tax or fee on alternative nicotine18 products, tobacco products, or electronic smoking devices. This section19 shall not be construed to prevent a local unit of government from regulating20 the use of alternative nicotine products, tobacco products, or electronic21 smoking devices in any public place pursuant to section 39-5511, Idaho Code,22 or in any other public outdoor area. Nothing in this section shall preclude23 or preempt any local, county, or municipal government from exercising its24 lawful authority to regulate zoning or land use.25

SECTION 18. That Section 39-5714, Idaho Code, be, and the same is hereby26 amended to read as follows:27 39-5714. REQUIREMENTS FOR DELIVERY SALES. (1) No permittee shall make28 a delivery sale of alternative nicotine products, tobacco products, or elec-29 tronic smoking devices to any individual who is under age twenty-one (21)30 years in this state.31 (2) Each permittee taking a delivery sale order shall comply with: the32 age verification requirements set forth in section 39-5715, Idaho Code;33 the disclosure and notice requirements set forth in section 39-5716, Idaho34 Code; the shipping requirements set forth in section 39-5717, Idaho Code;35 the registration and reporting requirements set forth in section 39-5718,36 Idaho Code; all tax collection requirements provided by title 63, Idaho37 Code; and all other laws of the state of Idaho generally applicable to sales38 of alternative nicotine products, tobacco products, or electronic smoking39 devices that occur entirely within Idaho, including but not limited to those40 laws imposing excise taxes, sales and use taxes, licensing and tax stamping41 requirements, and escrow or other payment obligations.42

SECTION 19. That Section 39-5715, Idaho Code, be, and the same is hereby43 amended to read as follows:44

15 39-5715. AGE VERIFICATION REQUIREMENTS. No permittee shall mail or1 ship alternative nicotine products, tobacco products, or electronic smoking2 devices in connection with a delivery sale order unless, before mailing or3 shipping such alternative nicotine products, tobacco products, or elec-4 tronic smoking devices, the permittee accepting the delivery sale order5 first obtains from the prospective customer a certification that includes6 proof of age that the purchaser is at least twenty-one (21) years old, the7 credit or debit card used for payment has been issued in the purchaser's8 name, and the address to which the alternative nicotine products, tobacco9 products, or electronic smoking devices are being shipped matches the10 credit card company's address for the cardholder or employs technology that11 requires and authenticates independent, third-party age and identity veri-12 fication services, comparing data against third-party sources.13

SECTION 20. That Section 39-5717, Idaho Code, be, and the same is hereby14 amended to read as follows:15 39-5717. SHIPPING REQUIREMENTS -- TOBACCO PRODUCTS, ALTERNATIVE16 NICOTINE PRODUCTS, OR ELECTRONIC SMOKING DEVICES. Each permittee who mails17 or ships alternative nicotine products, tobacco products, or electronic18 smoking devices in connection with a delivery sale order shall include as19 part of the shipping documents a clear and conspicuous statement providing20 as follows:21 ALTERNATIVE NICOTINE PRODUCTS, TOBACCO PRODUCTS, OR ELECTRONIC22 SMOKING DEVICES: IDAHO LAW PROHIBITS SHIPPING TO INDIVIDUALS UNDER23 THE AGE OF TWENTY-ONE (21) YEARS AND REQUIRES THE PAYMENT OF TAXES24 PURSUANT TO CHAPTER 25, TITLE 63, IDAHO CODE. PERSONS VIOLATING25 THIS LAW MAY BE CIVILLY AND CRIMINALLY LIABLE.26 Anyone who delivers any such container distributes alternative nico-27 tine products, tobacco products, or electronic smoking devices as defined in28 section 39-5702(5) 39-5702(6), Idaho Code, and is subject to the terms and29 requirements of this chapter. If a permittee taking a delivery sale order30 also delivers the alternative nicotine products, tobacco products, or elec-31 tronic smoking devices without using a third-party delivery service, the32 permittee shall comply with all the requirements of vendor-assisted sales as33 defined in section 39-5702(17) 39-5702, Idaho Code.34

SECTION 21. That Section 39-5718, Idaho Code, be, and the same is hereby35 amended to read as follows:36 39-5718. REGISTRATION AND REPORTING REQUIREMENTS. (1) Prior to making37 delivery sales or shipping alternative nicotine products, tobacco products,38 or electronic smoking devices in connection with any such sales, every busi-39 ness shall obtain a permit from the department and file with the state tax40 commission a statement setting forth the permittee's name, trade name, and41 the address of the business's principal place of business and any other place42 of business.43 (2) No later than the tenth day of each calendar month, each permit-44 tee that has made a delivery sale or shipped or delivered alternative nico-45 tine products, tobacco products, or electronic smoking devices in connec-46 tion with any such sale during the previous calendar month shall file with47

16 the department and the state tax commission a memorandum or a copy of the in-1 voice that provides for each and every such delivery sale:2 (a) The name and address of the individual to whom the delivery sale was3 made;4 (b) The brand or brands of the alternative nicotine products, tobacco5 products, or electronic smoking devices that were sold in such delivery6 sale; and7 (c) The quantity of alternative nicotine products, tobacco products,8 or electronic smoking devices that were sold in such delivery sale.9 (3) Any alternative nicotine products, tobacco products, or electronic10 smoking devices sold or attempted to be sold in a delivery sale that does11 not meet the requirements of this chapter shall be forfeited to the state of12 Idaho.13

SECTION 22. That Section 39-8421, Idaho Code, be, and the same is hereby14 amended to read as follows:15 39-8421. DEFINITIONS. As used in sections 39-8420 through 39-8425,16 Idaho Code:17 (1) The definitions set forth in section 39-8402, Idaho Code, of the18 Idaho tobacco master settlement agreement complementary act, and in this19 section, apply to sections 39-8420 through 39-8425, Idaho Code.20 (2) "Cigarette rolling machine" means any machine or device that has21 the capability to produce at least one hundred fifty (150) cigarettes in less22 than thirty (30) minutes.23 (3) "Cigarette rolling machine operator" means any person who owns or24 leases or otherwise has available for use a cigarette rolling machine and25 makes such a machine available for use by another person in a commercial26 setting in order to manufacture a cigarette. No person shall be deemed a27 cigarette rolling machine operator based solely upon that person's manufac-28 ture, sale, enabling, disabling, or repair of a cigarette rolling machine.29 (4) "Minor" has the same meaning as that term is defined in section30 39-5702(7) 39-5702, Idaho Code.31 (5) "Person" means natural persons, corporations both foreign and do-32 mestic, trusts, partnerships both limited and general, incorporated or un-33 incorporated associations, companies, business entities, and any other le-34 gal entity, or any other group associated in fact although not a legal en-35 tity.36 (6) "Tobacco products" means any substance that contains tobacco,37 including but not limited to cigarettes, cigars, pipes, snuff, smoking to-38 bacco, tobacco papers, or smokeless tobacco.39

SECTION 23. That Section 56-227F, Idaho Code, be, and the same is hereby40 amended to read as follows:41 56-227F. PUBLIC ASSISTANCE BENEFIT CARDS -- PROHIBITED USES. (1) Any42 recipient of public assistance is prohibited from using public assistance43 benefit cards or cash obtained with public assistance benefit cards:44 (a) For the purpose of participating in any of the activities described45 under chapters 38 and 49, title 18, Idaho Code, or authorized pursuant46 to any state-tribal gaming compact under section 67-429A, Idaho Code;47

17 (b) For the purpose of pari-mutuel betting authorized under chapter 25,1 title 54, Idaho Code;2 (c) To purchase lottery tickets or shares authorized under chapter 74,3 title 67, Idaho Code;4 (d) For the purpose of participating in or purchasing tattoo, branding5 or body piercing services as defined in section 18-1523, Idaho Code;6 (e) To purchase cigarettes as defined in section 39-7802(d), Idaho7 Code, or tobacco products or electronic smoking devices as defined in8 section 39-5702(15) 39-5702, Idaho Code;9 (f) To purchase any items regulated under title 23, Idaho Code;10 (g) For the purpose of adult entertainment at venues with performances11 that contain sexually oriented material where minors under the age of12 eighteen (18) years are prohibited; or13 (h) For the purpose of purchasing or participating in any activities in14 any location listed in subsection (2) of this section.15 (2) The following businesses are required to comply with the provisions16 of this section:17 (a) Any establishment or business licensed under chapter 9, title 23,18 Idaho Code;19 (b) State liquor stores defined under section 23-902, Idaho Code, with20 the exception of special distributors as referenced in chapter 3, title21 23, Idaho Code;22 (c) Any business or agency that issues or underwrites bail bonds as de-23 fined in section 41-1038(3), Idaho Code;24 (d) Gambling establishments licensed under Idaho law;25 (e) Any business or establishment that offers tattoo, body piercing or26 branding services as defined in section 18-1523, Idaho Code;27 (f) Adult entertainment venues with performances that contain sexually28 oriented material where minors under the age of eighteen (18) years are29 prohibited; and30 (g) Any establishment where persons under the age of eighteen (18)31 years are not permitted.32 (3) The department shall notify any business determined to be in viola-33 tion of the provisions of subsection (2) of this section and the licensing34 authority of any such business, if applicable, that such business has con-35 tinued to allow the use of a public assistance benefit card in violation of36 subsection (2) of this section. The department may require the Idaho quest37 electronic benefits transfer (EBT) card business identification number38 (BIN) be disabled at any business found to be in violation of subsection (2)39 of this section. Any business in violation of subsection (2) of this section40 may also be required to deny all public assistance cash transactions made41 with an Idaho quest EBT card at any automated teller machine (ATM) located42 in their establishment. All costs associated with disabling the BIN and ATM43 will be the responsibility of such business owner.44 (4) Only the recipient, an eligible member of the recipient's house-45 hold or the recipient's authorized representative may use a public assis-46 tance benefit card or the benefit, and such use shall only be for the re-47 spective benefit program purposes. The recipient shall not sell, attempt to48 sell, exchange or donate a public assistance benefit card or any benefits to49 any other person or entity.50

18 (5) A violation of subsection (1) or (4) of this section by a recipient1 constitutes a misdemeanor.2 (a) The department shall notify all recipients of public assistance3 benefit cards that any violation of subsection (1) or (4) of this sec-4 tion could result in legal proceedings and forfeiture of all cash public5 assistance.6 (b) Whenever the department has confirmed that a person has violated7 subsection (1) or (4) of this section, the department shall notify the8 person in writing that the violation could result in legal proceedings9 and forfeiture of all cash public assistance.10 (6) As used in this section, "public assistance" or "public assistance11 benefit" means benefits provided to a recipient pursuant to the temporary12 assistance for families in Idaho (TAFI) program on an Idaho quest EBT card13 account.14 (7) This section shall be enforced by the director of the department of15 health and welfare in cooperation with local law enforcement and prosecuting16 agencies.17

SECTION 24. That the Heading for Chapter 25, Title 63, Idaho Code, be,18 and the same is hereby amended to read as follows:19 CHAPTER 2520 CIGARETTE, NICOTINE, AND TOBACCO PRODUCTS TAXES21

SECTION 25. That Section 63-2551, Idaho Code, be, and the same is hereby22 amended to read as follows:23 63-2551. TOBACCO AND NICOTINE PRODUCTS TAX -- DEFINITIONS. As used in24 this act:25 (1) "Tobacco products" shall mean any cigars, cheroots, stogies,26 smoking tobacco (including granulated, plug, cut, crimp cut, ready rubbed27 and any other kinds and forms of tobacco suitable for smoking in a pipe or28 cigarette), chewing tobacco (including cavendish, twist, plug, scrap and29 any other kinds and forms of tobacco suitable for chewing) and snuff, however30 prepared; and shall include any other articles or products made of tobacco31 except cigarettes;32 (2) "Manufacturer" means a person who manufactures and sells tobacco33 products, alternative nicotine products, or vapor products;34 (3) "Distributor" means (a) any person engaged in the business of sell-35 ing tobacco products, alternative nicotine products, or vapor products in36 this state who brings, or causes to be brought, into this state from without37 the state any tobacco products, alternative nicotine products, or vapor38 products for sale, (b) any person who makes, manufactures, or fabricates39 tobacco products, alternative nicotine products, or vapor products in this40 state for sale in this state, (c) any person engaged in the business of41 selling tobacco products, alternative nicotine products, or vapor products42 without this state who ships or transports tobacco products, alternative43 nicotine products, or vapor products to retailers in this state, to be sold44 by those retailers;45 (4) "Subjobber" means any person, other than a manufacturer or distrib-46 utor, who buys tobacco products, alternative nicotine products, or vapor47

19 products from a distributor and sells them to persons other than the ultimate1 consumers;2 (5) "Retailer" means any person engaged in the business of selling to-3 bacco products, alternative nicotine products, or vapor products to ulti-4 mate consumers;5 (6) "Sale" means any transfer, exchange, or barter, in any manner or by6 any means whatsoever, for a consideration, and includes and means all sales7 made by any person. It includes a gift by a person engaged in the business of8 selling tobacco products, alternative nicotine products, or vapor products,9 for advertising, as a means of evading the provisions of this chapter, or for10 any other purposes whatsoever;11 (7) "Wholesale sales price" means the established price for which a12 manufacturer or any person sells a tobacco product, alternative nicotine13 product, or vapor product to a distributor that is not a related person as de-14 fined in section 267 of the Internal Revenue Code, exclusive of any discount15 or other reduction;16 (8) "Business" means any trade, occupation, activity, or enterprise17 engaged in for the purpose of selling or distributing tobacco products, al-18 ternative nicotine products, or vapor products in this state;19 (9) "Place of business" means any place where tobacco products, alter-20 native nicotine products, or vapor products are manufactured, stored, or21 kept for the purpose of sale or consumption, including any vessel, vehicle,22 airplane or train;23 (10) "Retail outlet" means each place of business from which tobacco24 products, alternative nicotine products, or vapor products are sold to con-25 sumers;26 (11) "Commission" means the Idaho state tax commission.27 (12) "Alternative nicotine product" means a noncombustible product28 that contains nicotine, whether natural or synthetic, but does not contain29 tobacco and is intended for human consumption, whether chewed, absorbed,30 dissolved, ingested, or by other means. This term shall not include a vapor31 product or any product regulated by the United States food and drug adminis-32 tration under chapter V of the federal food, drug, and cosmetic act.33 (13) "Electronic smoking device" has the same meaning as that term is34 defined in section 39-5702, Idaho Code.35 (14) "Vapor product" means any liquid, substance, or mixture, whether36 or not containing nicotine, that is designed, manufactured, or marketed for37 use in an electronic smoking device to produce vapor, including any pre-38 filled cartridge, pod, vapor solution, vapor cartridge, or other container39 of liquid or other form that is intended to be used with or in an electronic40 cigarette, electronic cigar, electronic cigarillo, electronic pipe, or sim-41 ilar product or device. The term does not include any product regulated by42 the United States food and drug administration under chapter V of the federal43 food, drug, and cosmetic act.44

SECTION 26. That Section 63-2552B, Idaho Code, be, and the same is45 hereby amended to read as follows:46 63-2552B. TOBACCO PRODUCTS, ALTERNATIVE NICOTINE PRODUCTS, AND VAPOR47 PRODUCTS USE TAX. Any person who does not hold a tobacco products tax permit48 who possesses, purchases or consumes tobacco products, alternative nicotine49

20 products, or vapor products upon which tax imposed by this chapter has not1 been paid, including tobacco products, alternative nicotine products, or2 vapor products sold by internet, catalog, telephone and facsimile sell-3 ers, is liable for the taxes imposed by sections 63-2552, and 63-2552A, and4 63-2552C, Idaho Code, to be reported and paid as required in section 63-2560,5 Idaho Code.6

SECTION 27. That Chapter 25, Title 63, Idaho Code, be, and the same is7 hereby amended by the addition thereto of a NEW SECTION, to be known and des-8 ignated as Section 63-2552C, Idaho Code, and to read as follows:9 63-2552C. TAX ON THE SALE OF ALTERNATIVE NICOTINE PRODUCTS AND VAPOR10 PRODUCTS -- DISTRIBUTION. (1) There is hereby imposed an excise tax on vapor11 products sold in the state of Idaho. Such tax shall be at the rate of five12 cents (5¢) per fluid milliliter of vapor products. All invoices for any va-13 por product issued by manufacturers shall state the amount of consumable va-14 por product in milliliters. The distributor shall be liable for the payment15 of the tax imposed by this subsection. The tax shall be imposed at the time16 the distributor:17 (a) Brings or causes to be brought into this state vapor products for18 sale;19 (b) Manufactures vapor products in this state for sale; or20 (c) Ships or transports vapor products to retailers in this state to be21 sold by those retailers.22 (2) There is hereby imposed an excise tax on alternative nicotine prod-23 ucts sold in the state of Idaho. Such tax shall be at the rate of twenty-five24 cents (25¢) per container of alternative nicotine products that contains at25 least one (1) and not more than twenty (20) units, and for any container that26 includes more than twenty (20) units, at the rate of twenty-five cents (25¢)27 per container plus a proportionate tax at the like rate on each unit in excess28 of twenty (20) units. The distributor shall be liable for the payment of the29 tax imposed by this subsection. The tax shall be imposed at the time the dis-30 tributor:31 (a) Brings or causes to be brought into this state alternative nicotine32 products for sale;33 (b) Manufactures alternative nicotine products in this state for sale;34 or35 (c) Ships or transports alternative nicotine products to retailers in36 this state to be sold by those retailers.37 (3) A retailer who brings, or causes to be brought, into this state from38 outside the state alternative nicotine products or vapor products for sale39 on which the tax has not been paid is responsible for payment of the tax at40 the time of receiving such products and before selling such products to the41 ultimate consumer.42 (4) Revenues received from the taxes imposed by this section shall be43 distributed by the state tax commission as follows:44 (a) Fifty percent (50%) shall be distributed to the department of45 health and welfare for adult and children's behavioral health programs;46 (b) Twenty-five percent (25%) shall be distributed to the public school47 income fund for the purposes of safe and drug free schools and include48

21 purposes of prevention and cessation, behavioral health, and the hiring1 of personnel necessary to respond to the use of nicotine products; and2 (c) Twenty-five (25%) shall be distributed to the general fund.3

SECTION 28. That Section 63-2553, Idaho Code, be, and the same is hereby4 amended to read as follows:5 63-2553. LEGISLATIVE INTENT. It is the intent and purpose of this6 chapter to levy a tax on all tobacco products, alternative nicotine prod-7 ucts, and vapor products sold, used, consumed, handled, or distributed8 within this state and to collect the tax from the distributor as defined in9 section 63-2551, Idaho Code. It is the further intent and purpose of this10 chapter to impose the tax only once but nothing in this chapter shall be con-11 strued to exempt any person taxable under any other law or under any other tax12 imposed by the state of Idaho.13

SECTION 29. That Section 63-2554, Idaho Code, be, and the same is hereby14 amended to read as follows:15 63-2554. PERMIT REQUIRED. (1) No person shall engage in the business16 of a manufacturer, distributor, or subjobber of tobacco products, alterna-17 tive nicotine products, or vapor products at any place of business without18 first having received from the commission a permit as provided in section19 63-2503 or 63-2504, Idaho Code.20 (2) Distributors and subjobbers shall purchase tobacco products, al-21 ternative nicotine products, or vapor products only from a manufacturer,22 wholesaler, or distributor who has obtained a permit under this chapter or23 under chapter 57, title 39, Idaho Code, as appropriate, and shall verify that24 the seller holds a valid permit before making a purchase.25 (3) Retailers shall purchase alternative nicotine products, tobacco26 products, or vapor products only from a wholesaler or distributor who has ob-27 tained a permit under this chapter or under chapter 57, title 39, Idaho Code,28 as appropriate, and shall verify that the seller holds a valid permit before29 making a purchase.30 (4) Manufacturers shall sell alternative nicotine products, tobacco31 products, or vapor products only to a wholesaler, subjobber, or distributor32 who has obtained a permit under this chapter or under chapter 57, title 39,33 Idaho Code, as appropriate, and shall verify that the purchaser holds a valid34 permit before making a sale.35 (5) Wholesalers, subjobbers, and distributors shall sell alternative36 nicotine products, tobacco products, or vapor products only to a wholesaler,37 subjobber, distributor, or retailer who has obtained a permit under this38 chapter or under chapter 57, title 39, Idaho Code, as appropriate, and shall39 verify that the purchaser holds a valid permit before making a sale.40 (6) The state tax commission shall publish a list of active permits and41 shall update such list monthly. The state tax commission also shall publish42 a list of persons whose permits have been suspended or revoked, including the43 date of the suspension and the date of the anticipated reinstatement or the44 date of the revocation.45

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SECTION 30. That Section 63-2555, Idaho Code, be, and the same is hereby1 amended to read as follows:2 63-2555. BOOKS AND RECORDS TO BE PRESERVED -- ENTRY AND INSPECTION BY3 COMMISSION. (1) Every distributor shall keep at each registered place of4 business complete and accurate records for that place of business, including5 itemized invoices, of tobacco products, alternative nicotine products, and6 vapor products held, purchased, manufactured, brought in or caused to be7 brought in from without the state, or shipped or transported to retailers8 in this state, and of all sales of tobacco products, alternative nicotine9 products, and vapor products made, except sales to the ultimate consumer.10 (2) These records shall show the names and addresses of purchasers, the11 inventory of all tobacco products, alternative nicotine products, and vapor12 products on hand on July 1, 1972, July 1, 2026, and other pertinent papers and13 documents relating to the purchase, sale or disposition of tobacco products,14 alternative nicotine products, and vapor products.15 (3) When a registered distributor sells tobacco products, alternative16 nicotine products, or vapor products exclusively to the ultimate consumer17 at the address given in the certificate, no invoice of those sales shall18 be required, but itemized invoices shall be made of all tobacco products,19 alternative nicotine products, and vapor products transferred to other re-20 tail outlets owned or controlled by that registered distributor. All books,21 records, and other papers and documents required by this section to be kept22 shall be preserved for a period of at least five (5) years after the date of23 the documents, as aforesaid, or the date of the entries thereof appearing in24 the records, unless the commission, in writing, authorizes their destruc-25 tion or disposal at an earlier date. At any time during usual business hours,26 the commission, or its duly authorized agents or employees, may enter any27 place of business of a distributor, without a search warrant, and inspect28 the premises, the records required to be kept under this chapter, and the to-29 bacco products, alternative nicotine products, and vapor products contained30 therein, to determine whether or not all the provisions of this chapter are31 being fully complied with. If the commission, or any of its agents or employ-32 ees, is denied free access or is hindered or interfered with in making such33 examination, the permit of the distributor at such premises shall be subject34 to revocation by the commission.35

SECTION 31. That Section 63-2556, Idaho Code, be, and the same is hereby36 amended to read as follows:37 63-2556. PRESERVATION OF INVOICES OF SALES TO OTHER THAN ULTIMATE CON-38 SUMER. Every person who sells tobacco products, alternative nicotine prod-39 ucts, or vapor products to persons other than the ultimate consumer shall40 render with each sale itemized invoices showing the seller's name and ad-41 dress, the purchaser's name and address, the date of sale, and all prices and42 discounts. He shall preserve legible copies of all such invoices for five43 (5) years from the date of sale.44

SECTION 32. That Section 63-2557, Idaho Code, be, and the same is hereby45 amended to read as follows:46

23 63-2557. INVOICES OF PURCHASES TO BE PROCURED BY RETAILER, SUBJOBBER1 -- PRESERVATION -- INSPECTION. Every retailer and subjobber shall procure2 itemized invoices of all tobacco products, alternative nicotine products,3 and vapor products purchased. The invoices shall show the name and address4 of the seller and the date of purchase. The retailer and subjobber shall pre-5 serve a legible copy of each such invoice for five (5) years from the date of6 purchase. Invoices shall be available for inspection by the commission or7 its authorized agents or employees at the retailer's or subjobber's place of8 business.9

SECTION 33. That Section 63-2558, Idaho Code, be, and the same is hereby10 amended to read as follows:11 63-2558. RECORDS OF SHIPMENTS, DELIVERIES FROM PUBLIC WAREHOUSE OF12 FIRST DESTINATION -- PRESERVATION -- INSPECTION. Records of all deliveries13 or shipments of tobacco products, alternative nicotine products, or vapor14 products from any public warehouse of first destination in this state shall15 be kept by the warehouse and be available to the commission for inspection.16 They shall show the name and address of the consignee, the date, the quan-17 tity of tobacco products, alternative nicotine products, and vapor products18 delivered, and such other information as the commission may require. These19 records shall be preserved for five (5) years from the date of delivery of the20 tobacco products, alternative nicotine products, or vapor products.21

SECTION 34. That Section 63-2559, Idaho Code, be, and the same is hereby22 amended to read as follows:23 63-2559. WHEN CREDIT MAY BE OBTAINED FOR TAX PAID. (1) Where tobacco24 products, alternative nicotine products, or vapor products upon which25 the tax taxes imposed by this chapter has have been reported and paid, are26 shipped or transported by the distributor to distributors or retailers27 outside the state, to be sold by those distributors or retailers, or are28 returned to the manufacturer by the distributor or destroyed by the distrib-29 utor, credit of such tax taxes may be made to the distributor in accordance30 with rules prescribed by the commission.31 (2) Taxes paid on tobacco products, alternative nicotine products, or32 vapor products sold on or after January 1, 2000, on accounts later found to be33 worthless and actually charged-off may be credited upon a subsequent payment34 of the tax taxes on tobacco products, alternative nicotine products, and va-35 por products or, if no such tax is taxes are due, refunded. If all or part36 of such an account is thereafter collected, the tax taxes shall be paid based37 upon the proportion of the amount collected.38

SECTION 35. That Section 63-2563, Idaho Code, be, and the same is hereby39 amended to read as follows:40 63-2563. COLLECTION AND ENFORCEMENT. The collection and enforcement41 procedures provided by the Idaho income tax act, sections 63-3038, 63-3039,42 63-3040, 63-3042 through 63-3045B, 63-3047 through 63-3065A, 63-3068,43 63-3071, 63-3075 and 63-3078, Idaho Code, shall apply and be available to44 the state tax commission for the enforcement of this act and collection of45

24 any amounts due under this act and said sections shall, for this purpose,1 be considered part of this act and wherever liens or any other proceedings2 are defined as income tax liens or proceedings, they shall, when applied in3 enforcement or collection under this act, be described as tobacco products,4 alternative nicotine products, and vapor products tax liens and proceed-5 ings. Any reference to taxable year in the income tax act shall be, for the6 purposes of this act, considered a taxable period.7 The state tax commission may be made a party defendant in an action at8 law or in equity by any person aggrieved by the unlawful seizure or sale of9 his property, or in any suit for refund or to recover an overpayment, but10 only the state of Idaho shall be responsible for any final judgment secured11 against the state tax commission, and said judgment shall be paid or satis-12 fied out of the tobacco products, alternative nicotine products, and vapor13 products tax refund fund.14

SECTION 36. That Section 63-2565, Idaho Code, be, and the same is hereby15 amended to read as follows:16 63-2565. REFUNDS, LIMITATIONS, INTEREST. (a) Where there has been an17 overpayment of any tobacco products, alternative nicotine products, and va-18 por products tax imposed by this act, the amount of such overpayment shall be19 credited against any tobacco products, alternative nicotine products, and20 vapor products tax then due from the taxpayer, and any balance of such excess21 shall be refunded to the taxpayer.22 (b) The state tax commission is authorized and the state board of tax23 appeals is authorized to order the tax commission in proper cases to credit24 or remit, refund, and pay back all taxes and penalties erroneously or ille-25 gally assessed or collected, regardless of whether the same have been paid26 under protest, which claims for refund shall be certified to the state board27 of examiners by the state tax commission.28 (c) No such credit or refund of taxes, penalties or interest paid, shall29 be allowed or made after three (3) years from the time the return was filed,30 unless before the expiration of such period a claim therefor is filed by the31 taxpayer with the commission.32 (d) Interest shall be allowed on the amount of such credits or refunds33 at the rate provided in section 63-3045, Idaho Code, from the date such tax34 was paid.35 (e) Appeal of a tax commission decision denying in whole or part a claim36 for refund shall be made in accordance with and within the time limits pre-37 scribed in section 63-3049, Idaho Code.38

SECTION 37. An emergency existing therefor, which emergency is hereby39 declared to exist, this act shall be in full force and effect on and after40 July 1, 2026.41