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SACRAMENTO, Calif. -- To further reduce the trafficking of counterfeit cigarettes and related excise tax evasion in California, Betty T. Yee, chairwoman of the state Board of Equalization (BOE) announced this week that improved high-tech tax stamps with a new design will soon be available and affixed to packs of cigarettes sold throughout the state.
Retailers and consumers can expect to see the new tax stamps in use by Jan. 1. The new design is gold-yellow in appearance, with a color-shifting effect visible on the left edge and a unique serial number, according to a released statement.
It is estimated that cigarette-related tax evasion costs California $182 million annually. The high-tech stamp and other BOE enforcement efforts combine to reduce the tax evasion by $133 million each year in sales and excise taxes, the release stated.
The new stamp will feature special ink and a counterfeit and tamper-resistant design; [it] will also help simplify authentication and discourage tax stamp counterfeiting.
According to the release, under Senate Bill 1701 in 2002, the BOE was required to replace the heat-applied decals in use at the time with counterfeit-resistant stamps encrypted with specific information. In 2004 the California Cigarette and Tobacco Products Licensing Act required nationwide licensing for sellers of cigarettes and tobacco products. And lastly in 2007, the Licensing Act received expanded provisions to include licensing requirements for manufacturers and importers and made provisions of the Licensing Act permanent.
Excise tax paid on cigarettes and tobacco are used to fund state services and programs.