PRINTER'S NO. 1185
No. 1043 Session of 1989
INTRODUCED BY CORNELL, TRELLO, NAHILL, GEIST, FOX, HECKLER,
BUNT, SERAFINI AND REBER, APRIL 5, 1989
REFERRED TO COMMITTEE ON FINANCE, APRIL 5, 1989
AN ACT
1 Imposing a tax on manufacturing, producing, transporting or
2 importing certain controlled substances; conferring powers
3 and duties on the Department of Revenue; imposing penalties;
4 and making an appropriation.
5 The General Assembly of the Commonwealth of Pennsylvania
6 hereby enacts as follows:
7 Section 1. Short title.
8 This act shall be known and may be cited as the Controlled
9 Substance Tax Act.
10 Section 2. Definitions.
11 The following words and phrases when used in this act shall
12 have the meanings given to them in this section unless the
13 context clearly indicates otherwise:
14 "Controlled substance." A drug or substance or its immediate
15 precursor included in Schedules I through V of the act of April
16 14, 1972 (P.L.233, No.64), known as The Controlled Substance,
17 Drug, Device and Cosmetic Act.
18 "Dealer." A person in this Commonwealth who manufactures,
1 produces, transports or imports into this Commonwealth a
2 controlled substance and who is not registered under section 6
3 of the act of April 14, 1972 (P.L.233, No.64), known as The
4 Controlled Substance, Drug, Device and Cosmetic Act.
5 "Department." The Department of Revenue of the Commonwealth.
6 "Secretary." The Secretary of Revenue of the Commonwealth.
7 Section 3. Incidence and rate of taxation.
8 If a person not registered under section 6 of the act of
9 April 14, 1972 (P.L.233, No.64), known as The Controlled
10 Substance, Drug, Device and Cosmetic Act, manufactures,
11 produces, transports, delivers or possesses with intent to
12 deliver a controlled substance, there is a taxable transaction.
13 A tax is levied on each taxable transaction at the rate of 20%
14 of the estimated retail price of the controlled substance
15 involved.
16 Section 4. Liability for payment of tax.
17 (a) Payment.--Taxes imposed by section 3 are due and payable
18 immediately upon acquisition or possession in this Commonwealth
19 by a dealer.
20 (b) Proof.--If the tax is paid under subsection (a), the
21 department shall affix an indication of payment to the container
22 of the controlled substance. The dealer shall bear the cost of
23 the indicator.
24 Section 5. Interest and penalties.
25 The taxes imposed under this act are subject to the same
26 interest and the same procedure for collection and enforcement
27 as taxes imposed under the act of March 4, 1971 (P.L.6, No.2),
28 known as the Tax Reform Code of 1971.
29 Section 6. Administration.
30 The department shall administer this act. The department may
19890H1043B1185 - 2 -
1 promulgate regulations to administer this act.
2 Section 7. Penalties.
3 (a) Prohibition.--A dealer may not possess a controlled
4 substance with respect to which tax is imposed under section 3
5 unless the tax has been paid under section 4.
6 (b) Civil penalties.--A dealer who violates subsection (a)
7 is subject to a civil penalty in the amount of 100% of the tax.
8 (c) Criminal penalty.--A dealer who violates subsection (a)
9 commits a misdemeanor of the second degree.
10 (d) Disposition.--Fines and penalties collected under this
11 section shall be deposited into the General Fund and are
12 appropriated to the department to administer this act.
13 Section 8. Pharmaceuticals.
14 Nothing in this act requires persons registered under section
15 6 of the act of April 14, 1972 (P.L.233, No.64), known as The
16 Controlled Substance, Drug, Device and Cosmetic Act, or
17 otherwise lawfully in possession of a controlled substance to
18 pay the tax required under this act.
19 Section 9. Confidential nature of information.
20 Neither the secretary nor a public employee may reveal facts
21 contained in a report or return required by this act, nor may
22 any information contained in a report or return be used against
23 the dealer in a criminal proceeding, unless independently
24 obtained, except in connection with a proceeding involving taxes
25 due under this act from the taxpayer making the return.
26 Section 10. Effective date.
27 This act shall take effect in 60 days.
A10L72JRW/19890H1043B1185 - 3 -