Refunds
Wholesalers and retailers may claim tax refunds for stolen or destroyed product and rebates for uncollectible accounts.

Interest on refunds is calculated from the date the tax was remitted until the refund is paid or applied to a vendor's account, but only on tax paid in error, or a paid assessment that was later reversed. Interest and penalty assessments and any unpaid tax is calculated from the date when the default first occurred until the assessment is paid. The interest rate changes quarterly and is compounded monthly.

Compliance Measures

Licensing
Tobacco wholesalers must obtain a Wholesale Vendor's Permit (See Permit Application form) from the Commissioner.

Only wholesalers, holding a valid Wholesale Vendor's Permit, can sell tobacco to retailers. Wholesalers can only sell tobacco to retailers who hold a valid Tobacco Retail Vendor's Permit (See Permit Application form). Only retailers with this vendor permit can sell tobacco to consumers. Retailers must purchase tobacco from wholesalers who hold a Wholesale Vendor's Permit. Wholesalers may also sell to other wholesalers, providing both hold Wholesale Vendor Permits. We provide the wholesalers with updates of valid Retail Vendor Numbers.

Those purchasing, possessing, storing or selling unmarked tobacco in Nova Scotia must hold a Permit to Purchase and Sell Unmarked Tobacco (See Permit Application form).

Those marking tobacco products must obtain a Permit to Mark Tobacco (See Permit Application form). Those stamping tobacco products must obtain a Permit to Stamp Tobacco (See Permit Application form).

Security Requirements
The Commissioner may require an agent, subagent, collector or applicant for a registration certificate to deposit with the Minister a bond by way of cash or other security in such an amount as may be determined by the Commissioner, which shall not in any case be greater than an amount equal to six times the amount of the tax estimated by the Commissioner to be the amount normally collected by the applicant or collector each month in compliance with this Act or the regulations.

Cancellation and Suspension
Grounds for canceling, suspending, refusing to issue or renew a permit include:

filing a false return
contravening the provisions of the Revenue Act
failure to remit tax, or to file a return
failure to post the required security
found guilty of an offence against the Act
possession of a non-approved video gaming device
possession of a non-approved video amusement device
contravening the Tobacco Access Act
conviction of an offence under the Criminal Code (Canada), the Excise Tax Act (Canada) or the Income Tax Act (Canada).

Before cancellation or suspension, persons are afforded the opportunity to present reasons to the Tax Commission as to why the permit should not be canceled or suspended.

Audit
In making an assessment, the Commissioner shall not consider a period or periods of time greater than four years prior to the date of commencement of the inspection, audit or examination of the books of account, records or documents, unless the Commissioner deems the person did not exercise the degree of care, diligence and skill to prevent an offence that a reasonably prudent person would exercise in comparable circumstances, or if there is evidence that the person has committed fraud, and the results may be applied over the period or any part of the period.

Fines and Penalties
The following penalties can be imposed under the Revenue Act:

5% - failure to pay or remit tax
5%-100% - willful failure to remit tax collected
25% - failure to pay tax by willfully making a false statement
25% - failure to maintain records

See Bulletin 5036 for more information.

Marking/Tax Exempt
Cigarettes,pre-portioned tobacco sticks, and fine cut tobacco manufactured for retail sale in Nova Scotia must bear approved markings.

Status Indians, exporters and interprovincial wholesalers may obtain tobacco without Nova Scotia markings.

Status Indians purchase tobacco products that are marked "CANADA DUTY PAID".

Tobacco purchases by ships' chandlers for use as ships stores are marked "CANADA DUTY PAID".

Tobacco purchases delivered to a duty free shop or a customs bonded warehouse are marked "CANADA DUTY PAID".

Interprovincial tobacco wholesalers can carry stock marked for other provinces.

Tobacco Sales to Status Indians
Only "black stock" tobacco may be sold exempt from tax to designated retailers for sale to Status Indians.

Agreements are in place with each band council establishing the quantities and identifying the designated retailers and wholesalers. Quantities are based on band population and are increased for special events upon approved requests.

The Commission informs designated wholesale suppliers of the details of designated retailers who are authorized to sell unmarked tobacco and their monthly allocations.

Inspections
Compliance officers visit retailers and inspect the premises for unmarked cigarettes and compliance with the legislation.

Given reasonable grounds, compliance officers may also, without a warrant, stop, detain and examine the contents of vehicles. If the person fails to produce required documentation, tobacco may be seized, impounded, held and disposed.

The compliance staff cooperate with and assist police agencies and Federal Government Departments with investigations. They can lay charges under the Revenue Act.

Forms

Application Forms for permits are available from the Forms and Applications area of this site.