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138.165 Contraband cigarettes -- Vending machines and motor vehicles -Seizure -- Sale -- Remission of forfeiture -- Appeal.
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It is declared to be the legislative intent of KRS 138.130 to 138.205 that any
untax-paid cigarettes held, owned, possessed, or in control of any person other
than as provided in KRS 138.130 to 138.205 are contraband and subject to
seizure and forfeiture as set out in this section.
Whenever any peace officer of this state, or any representative of the
department, finds any untax-paid cigarettes within the borders of this state in
the possession of any person other than a licensee authorized to possess
untax-paid cigarettes by the provisions of KRS 138.130 to 138.205, such
cigarettes shall be immediately seized and stored in a depository to be
selected by the officer or agent. At the time of seizure, the officer or agent shall
deliver to the person in whose custody the cigarettes are found a receipt for the
cigarettes. The receipt shall state on its face that any inquiry concerning any
goods seized shall be directed to the commissioner of the Department of
Revenue, Frankfort, Kentucky. Immediately upon seizure, the officer or agent
shall notify the commissioner of the Department of Revenue of the nature and
quantity of the goods seized. Any seized goods shall be held for a period of
twenty (20) days and if after such period no person has claimed the cigarettes
as his property, the commissioner shall cause the same to be exposed to
public sale to any person authorized to purchase untax-paid cigarettes. The
sale shall be on notice published pursuant to KRS Chapter 424. All proceeds,
less the cost of sale, from the sale shall be paid into the Kentucky State
Treasury for general fund purposes.
It is declared to be the legislative intent that any vending machine used for
dispensing cigarettes on which Kentucky cigarette tax has not been paid is
contraband and subject to seizure and forfeiture. In the event any peace officer
or agent of the department finds any vending machine within the borders of this
state dispensing untax-paid cigarettes, he shall immediately seize the vending
machine and store the same in a safe place selected by him. He shall
thereafter proceed as provided in subsection (2) of this section and the
commissioner of the Department of Revenue shall cause the vending machine
to be sold, and the proceeds applied, as set out in subsection (2) of this
section.
No cigarettes, on which the tax imposed by KRS 138.130 to 138.205 has not
been paid, shall be transported within this state by any person other than a
manufacturer or a person licensed under the provisions of KRS 138.195. It is
declared to be the legislative intent that any motor vehicle used to transport
any such cigarettes by other persons is contraband and subject to seizure and
forfeiture. If any peace officer or agent of the department finds any such motor
vehicle, the vehicle shall be seized immediately and stored in a safe place. The
peace officer or agent of the department shall thereafter proceed as provided in
subsection (2) of this section and the commissioner of the Department of
Revenue shall cause the motor vehicle to be sold, and the proceeds applied,
as set out in subsection (2) of this section.
The owner or any person having an interest in any goods, machines or
vehicles seized as provided under subsections (1) to (4) of this section may
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apply to the commissioner of the Department of Revenue for remission of the
forfeiture for good cause shown. If it is shown to the satisfaction of the
Department of Revenue that the owner was without fault in the possession,
dispensing, or transportation of the untax-paid cigarettes, the Department of
Revenue shall remit the forfeiture. If the Department of Revenue determines
that the possession, dispensing, or transportation of untax-paid cigarettes was
willful or intentional, the Department of Revenue may nevertheless remit the
forfeiture on condition that the owner pay a penalty to be prescribed by the
Department of Revenue of not more than fifty percent (50%) of the value of the
property forfeited. All taxes due on untax-paid cigarettes shall be paid in
addition to the penalty, if any.
Any party aggrieved by an order entered hereunder may appeal to the
Kentucky Board of Tax Appeals in the manner provided by law.
Effective:June 20, 2005
History: Amended 2005 Ky. Acts ch. 85, sec. 349, effective June 20, 2005; and
ch. 168, sec. 84, effective June 1, 2005. -- Amended 1966 Ky. Acts ch. 239,
sec. 140. -- Amended 1964 Ky. Acts ch. 141, sec. 25. -- Created 1962 Ky. Acts
ch. 92, sec. 7(1) to (6).
Legislative Research Commission Note (6/1/2005). This section was amended
by 2005 Ky. Acts chs. 85 and 168, which do not appear to be in conflict and
have been codified together.
Legislative Research Commission Note (6/1/2005). 2005 Ky. Acts chs. 11, 85,
95, 97, 98, 99, 123, and 181 instruct the Reviser of Statutes to correct statutory
references to agencies and officers whose names have been changed in 2005
legislation confirming the reorganization of the executive branch. Such a
correction has been made in this section.
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