                                 CODE OF VIRGINIA

SALE, PURCHASE, POSSESSION, ETC., OF CIGARETTES FOR PURPOSE OF EVADING TAX;
PENALTIES (§ 58.1-1017)

A. Any person, except as otherwise provided by law, who sells, purchases,
transports, receives, or possesses unstamped cigarettes shall be required to pay
any tax owed pursuant to this chapter. In addition, such person shall be
required to pay a civil penalty of (i) $2.50 per pack, up to $500, for the first
violation by a legal entity within a 36-month period; (ii) $5 per pack, up to
$1,000, for the second violation by the legal entity within a 36-month period;
and (iii) $10 per pack, up to $50,000, for the third and any subsequent
violation by the legal entity within a 36-month period, to be assessed and
collected by the Department as other taxes are collected. In addition, where
willful intent exists to defraud the Commonwealth of the tax levied under this
chapter, such person shall be required to pay a civil penalty of $25 per pack,
up to $250,000.

B. It shall be unlawful for any person, except as otherwise provided by law, to
sell, purchase, transport, receive or possess less than 500 packages of
cigarettes unless the same have been stamped in the manner required by law, for
the purpose of evading the payment of the taxes on such products. Any person
violating the provisions of this subsection is guilty of a Class 1 misdemeanor.
Any person who is convicted of a second or subsequent violation of this
subsection is guilty of a Class 6 felony, provided that the accused was at
liberty as defined in &#xA7; 53.1-151 between each conviction and it is
admitted, or found by the jury or judge before whom the person is tried, that
the accused was previously convicted of a violation of this subsection.

C. It shall be unlawful for any person, except as otherwise provided by law, to
sell, purchase, transport, receive or possess 500 or more packages of cigarettes
unless the same have been stamped in the manner required by law, for the purpose
of evading the payment of the taxes on such products. Any person violating the
provisions of this subsection shall be guilty of a Class 6 felony. Any person
who is convicted of a second or subsequent violation of this subsection is
guilty of a Class 5 felony, provided that the accused was at liberty as defined
in &#xA7; 53.1-151 between each conviction and it is admitted, or found by the
jury or judge before whom the person is tried, that the accused was previously
convicted of a violation of this subsection.

D. If a person who (i) has not been issued a permit to affix revenue stamps by
the Department, as provided in &#xA7; 58.1-1011, or (ii) is not a retail dealer
who has lawfully purchased cigarettes from such permit holder has in his
possession within the Commonwealth more than 30 packages of unstamped
cigarettes, such possession shall be presumed to be for the purpose of evading
the payment of the taxes due thereon. No civil penalty shall be imposed under
this section for any unstamped cigarettes if a civil penalty under &#xA7;
58.1-1013 has been paid for such unstamped cigarettes.

HISTORY: Code 1950, § 58-757.17; 1960, c. 392, § 17; 1984, c. 675; 1992, c.
763; 2004, cc. 883, 996; 2005, c. 28; 2006, c. 409; 2010, cc. 35, 471; 2013, cc.
570, 624.