1.1.................... moves to amend H.F. No. 1219, the delete everything amendment
1.2(A11-0445), as follows:
1.3Page 58, after line 32, insert:

1.4    "Sec. 4. Minnesota Statutes 2010, section 297F.01, subdivision 3, is amended to read:
1.5    Subd. 3. Cigarette. "Cigarette" means any roll for smoking made wholly or in part
1.6of tobacco, that weighs 4.5 pounds or less per thousand:
1.7(1) the wrapper or cover of which is made of paper or another substance or material
1.8except tobacco; or
1.9(2) wrapped in any substance containing tobacco, however labeled or named, which,
1.10because of its appearance, size, the type of tobacco used in the filler, or its packaging,
1.11pricing, marketing, or labeling, is likely to be offered to or purchased by consumers as
1.12a cigarette, as defined in clause (1), unless it is wrapped in whole tobacco leaf and does
1.13not have a cellulose acetate or other cigarette-like filter.
1.14EFFECTIVE DATE.This section is effective July 1, 2011.

1.15    Sec. 5. Minnesota Statutes 2010, section 297F.01, subdivision 19, is amended to read:
1.16    Subd. 19. Tobacco products. "Tobacco products" means any product containing,
1.17made, or derived from tobacco that is intended for human consumption, whether chewed,
1.18smoked, absorbed, dissolved, inhaled, snorted, sniffed, or ingested by any other means,
1.19or any component, part, or accessory of a tobacco product, including, but not limited
1.20to, cigars; little cigars; cheroots; stogies; periques; granulated, plug cut, crimp cut,
1.21ready rubbed, and other smoking tobacco; snuff; snuff flour; cavendish; plug and twist
1.22tobacco; fine-cut and other chewing tobacco; shorts; refuse scraps, clippings, cuttings
1.23and sweepings of tobacco, and other kinds and forms of tobacco; but does not include
1.24cigarettes as defined in this section. Tobacco products excludes any tobacco product
1.25that has been approved by the United States Food and Drug Administration for sale as
2.1a tobacco cessation product, as a tobacco dependence product, or for other medical
2.2purposes, and is being marketed and sold solely for such an approved purpose.
2.3EFFECTIVE DATE.This section is effective July 1, 2011."
2.4Page 60, after line 9, insert:

2.5    "Sec. 8. Minnesota Statutes 2010, section 325D.32, subdivision 2, is amended to read:
2.6    Subd. 2. Cigarettes. "Cigarettes" means and includes any roll for smoking, made
2.7wholly or in part of tobacco, irrespective of size and shape and whether or not such
2.8tobacco is flavored, adulterated or mixed with any other ingredient, the wrapper or cover
2.9of which is made of paper or any other substance or material except whole tobacco leaf,
2.10and includes any cigarette as defined in section 297F.01, subdivision 3.

2.12    Subdivision 1. Report to legislature. (a) The commissioner of revenue shall report
2.13to the 2012 legislature on the tobacco tax collection system, including recommendations
2.14to improve compliance under the excise tax for both cigarettes and other tobacco products.
2.15The purpose of the report is to provide information and guidance to the legislature on
2.16improvements to the tobacco tax collection system to:
2.17(1) provide a unified system of collecting both the cigarette and other tobacco
2.18products taxes, regardless of category, size, or shape, that ensures the highest reasonable
2.19rates of tax collection;
2.20(2) discourage tax evasion; and
2.21(3) help to prevent illegal sale of tobacco products, which may make these products
2.22more accessible to youth.
2.23(b) In the report, the commissioner shall:
2.24(1) provide a detailed review of the present excise tax collection and compliance
2.25system as it applies to both cigarettes and other tobacco products. This must include
2.26an assessment of the levels of compliance for each category of products and the effect
2.27of the stamping requirement on compliance rates for cigarettes relative to other tobacco
2.28products. It also must identify any weaknesses in the system;
2.29(2) survey the methods of collection and enforcement used by other states or nations,
2.30including identifying and discussing emerging best practices that ensure tracking of both
2.31cigarettes and other tobacco products and result in the highest rates of tax collection and
2.32compliance. These best practices must consider high-technology alternatives, such as use
2.33of bar codes, radio-frequency identification tags, or similar mechanisms for tracking
3.1(3) evaluate the adequacy and effectiveness of the existing penalties and other
3.2sanctions for noncompliance;
3.3(4) evaluate the adequacy of the resources allocated by the state to enforce the
3.4tobacco tax and prevention laws; and
3.5(5) make recommendations on implementation of a comprehensive tobacco tax
3.6collection system for Minnesota that can be implemented by January 1, 2014, including:
3.7(i) recommendations on the specific steps needed to institute and implement the new
3.8system, including estimates of the state's costs of doing so and any additional personnel
3.10(ii) recommendations on methods to recover the cost of implementing the system
3.11from the industry;
3.12(iii) evaluation of the extent to which the proposed system is sufficiently flexible
3.13and adaptable to adjust to modifications in the construction, packaging, formatting, and
3.14marketing of tobacco products by the industry; and
3.15(iv) recommendations to modify existing penalties or to impose new penalties or
3.16other sanctions to ensure compliance with the system.
3.17    Subd. 2. Due date. The report required by subdivision 1 is due January 15, 2012.
3.18    Subd. 3. Procedure. The report required under this section must be made in the
3.19manner provided under Minnesota Statutes, section 3.195. In addition, copies must be
3.20provided to the chairs and ranking minority members of the legislative committees and
3.21divisions with jurisdiction over taxation.
3.22    Subd. 4. Appropriation. (a) $100,000 is appropriated from the general fund to the
3.23commissioner of revenue for fiscal year 2012 for the cost of preparing the report under
3.24subdivision 1.
3.25(b) The appropriation under this subdivision is a onetime appropriation and is not
3.26included in the base budget."
3.27Renumber the sections in sequence and correct the internal references
3.28Amend the title accordingly