BILL NUMBER: SB 1701	CHAPTERED  09/26/02

	CHAPTER  881
	FILED WITH SECRETARY OF STATE  SEPTEMBER 26, 2002
	APPROVED BY GOVERNOR  SEPTEMBER 25, 2002
	PASSED THE ASSEMBLY  JULY 3, 2002
	PASSED THE SENATE  MAY 20, 2002
	AMENDED IN SENATE  APRIL 30, 2002

INTRODUCED BY   Senator Peace

                        FEBRUARY 21, 2002

   An act to amend, repeal, and add Section 30162 of the Revenue and
Taxation Code, relating to taxation.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1701, Peace.  Tobacco taxes:  tax stamps.
   The Cigarette and Tobacco Products Tax Law requires that an
appropriate stamp be affixed to, or that an appropriate meter
impression be made upon, each package of cigarettes prior to
distribution.
   This bill would, as of January 1, 2005, require the State Board of
Equalization to replace the stamps and meter impressions, currently
required to be affixed to tobacco products, with a stamp or meter
impression that can be read by a scanning  or similar device, and
encrypted with specified information.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 30162 of the Revenue and Taxation Code is
amended to read:
   30162.  (a) Stamps and meter impressions shall be of the designs,
specifications and denominations as may be prescribed by the board.
The board shall prescribe by regulation the method and manner in
which stamps or meter impressions are to be affixed to packages of
cigarettes and may provide for the cancellation of stamps or meter
impressions.
   (b) This section shall remain in effect until January 1, 2005, and
as of that date is repealed.
  SEC. 2.  Section 30162 is added to the Revenue and Taxation Code,
to read:
   30162.  (a) Stamps and meter impressions shall be of the designs,
specifications, and denominations as may be prescribed by the board.
Stamps and meter impressions shall be generated by a technology
capable of being read by a scanning or similar device and shall be
encrypted with, at a minimum, the following information:
   (1) The name and address of the distributor affixing the stamp or
meter impression.
   (2) The date the stamp or meter impression was affixed.
   (3) The denominated value of the stamp or meter impression.
   (b) The board shall prescribe by regulation the method and manner
in which stamps or meter impressions are to be affixed to packages of
cigarettes and may provide for the cancellation of stamps or meter
impressions.
   (c) This section shall become operative on January 1, 2005.