Cigarette Tax

How Cigarettes In Colorado Are Taxed

Cigarettes are taxed differently from other tangible personal property/products purchased and sold in Colorado. Cigarettes are subject to both excise and sales tax. An excise cigarette tax return must be filed monthly, even if there is no tax due. For more information on sales tax, visit  Sales & Use Tax. The table below displays the applicable tax rates during each reporting period: 

The tax is represented by a Colorado cigarette tax stamp. Every pack of cigarettes sold to consumers in Colorado must have a Colorado cigarette tax stamp affixed to the bottom of the pack. This includes cigarettes ordered by telephone, mail or online. For more information, visit the Cigarette Stamps page.

Cigarettes stamped on or before December 31, 2020 with the 84¢ stamp for a pack of 20 cigarettes or with the $1.05 stamp for a pack of 25 cigarettes, may be sold until the inventory is depleted  at the 4.2¢ per cigarette tax rate without any additional cigarette inventory or cigarette floor tax. 

Cigarette Inventory Tax

An inventory floor tax on cigarette wholesalers (distributors) and wholesale subcontractors will be owed when the tax rate increases. The inventory tax is the difference between the old per pack tax and the new per pack tax. Cigarette packs stamped with the old tax stamp prior to July 1, 2024, are subject to the inventory tax and may be sold with the old stamp on or after July 1, 2024. It is unlawful to stamp cigarette packs with the old tax stamp after 11:59 p.m. June 30, 2024. Unused old stamps purchased within one year of the refund claim may be returned for credit, and new stamps reflecting the new tax rate will be available for purchase on July 1, 2024. For the rate increase effective July 1, 2024, all licensed cigarette distributors and wholesale subcontractors are required to file the Cigarette Inventory Tax Return, Form DR 0224, by August 12, 2024 through Revenue Online or as a paper form available at https://tax.colorado.gov/forms-in-number-order.

Inventory Tax return payments are required to be paid electronically. This can be done using Revenue Online or by electronic funds transfer (EFT). An EFT payment transmitted after the due date is subject to late penalty, interest, and loss of vendor fee.

Roll-Your-Own Cigarette Making Machine

Due to the passage of the 2012 federal highway bill (MAP-21), any person who makes available to consumers a machine capable of making tobacco products such as cigarettes is considered a manufacturer on the Federal level and must be licensed by the Tobacco and Trade Bureau. Once federal requirements have been met, the owner must certify the product through the Colorado Attorney General's Office.

For more information, see the Colorado Cigarette Tax Guide Publication.