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365.270 Definitions for KRS 365.260 to 365.380.
As used in KRS 365.260 to 365.380, unless the context otherwise requires:
(1) "Person" means and includes any individual, firm, association, company,
partnership, corporation, joint stock company, club, agency, syndicate, the
Commonwealth of Kentucky and any municipal corporation or other political
subdivision of this state, trust, receiver, trustee, fiduciary, or conservator.
(2) "Commissioner" means the commissioner of the Department of Revenue of the
Commonwealth of Kentucky.
(3) "Department" means the Department of Revenue.
(4) "Cigarettes" means and includes any roll for smoking made wholly or in part of
tobacco, irrespective of size or shape and whether or not the tobacco is flavored,
adulterated, or mixed with any other ingredient, the wrapper or cover of which is
made of paper or any other substance or material, excepting tobacco.
(5) "Wholesaler" means any person who sells cigarettes at wholesale or distributes
cigarettes to be sold at retail, and includes any manufacturer, distributor, jobber,
subjobber as defined in KRS 138.130(12), broker, agent, or other person, whether
or not enumerated in this subsection, who sells or distributes cigarettes.
(6) "Retailer" means and includes any person who sells cigarettes in this state to a
consumer or to any person for any purpose other than resale.
(7) "Sale" or "sell" means any transfer for consideration or gift.
(8) "Sell at wholesale," "sale at wholesale," and "wholesale sales" means and includes
any sale made in the ordinary course of trade or usual conduct of the wholesaler's
business to a retailer for the purpose of resale.
(9) "Sell at retail," "sale at retail," or "retail sales" means and includes any sale for
consumption or use made in the ordinary course of trade or usual conduct of the
seller's business.
(10) "Basic cost of cigarettes" means the invoice cost of cigarettes to the wholesaler or
retailer, as the case may be, less all trade discounts, except customary cash
discounts, plus the full face value of any stamps or any tax which may be required
by any cigarette tax act of this state or political subdivision thereof, now in effect or
hereafter enacted, if not already included in the invoice cost of the cigarettes to the
wholesaler or retailer, as the case may be.
(11) (a) "Cost to wholesaler" means the basic cost of the cigarettes involved to the
wholesaler plus the cost of doing cigarette business by the wholesaler. In
determining the cost of doing cigarette business by the wholesaler, the cost of
doing business by the wholesaler shall first be determined by applying the
standards and methods of accounting regularly employed by him, and includes
labor costs, including salaries of executives and officers, rent, depreciation,
selling costs, maintenance of equipment, delivery costs, all types of licenses,
taxes, insurance, and advertising. The cost of doing business by the wholesaler
shall then be multiplied by the fraction obtained through dividing the
wholesaler's cigarette sales for the preceding six (6) months by the
wholesaler's total sales for the same period and the product thereof shall be the
(b)
(12) (a)
(b)
cost of doing cigarette business.
In the absence of proof of a lesser or higher cost of doing cigarette business by
the wholesaler making the sale, the cost of doing cigarette business by the
wholesaler shall be presumed to be two percent (2%) of the basic cost of the
cigarettes to the wholesale dealer, plus cartage to the retail outlet, if performed
or paid for by the wholesale dealer. Cartage cost, in the absence of proof of a
lesser or higher cost, shall be presumed to be three-fourths of one percent
(0.75%) of the basic cost of the cigarettes to the wholesaler.
"Cost to the retailer" means the basic cost of cigarettes involved to the retailer
plus the cost of doing cigarette business by the retailer. In determining the cost
of doing cigarette business by the retailer, the cost of doing business by the
retailer shall first be determined by applying the standards and methods of
accounting regularly employed by him and includes labor, including salaries
of executives and officers, rent, depreciation, selling costs, maintenance of
equipment, delivery costs, all types of licenses, taxes, insurance, and
advertising. The cost of doing business by the retailer shall then be multiplied
by the fraction obtained through dividing the retailer's cigarette sales for the
preceding six (6) months by the retailer's total sales for the same period and
the product thereof shall be the cost of doing cigarette business.
In the absence of proof of a lesser or higher cost of doing cigarette business by
the retailer making the sale, the cost of doing cigarette business by the retailer
shall be presumed to be eight percent (8%) of the basic cost of cigarettes to the
retailer.
Effective: June 26, 2007
History: Amended 2007 Ky. Acts ch. 84, sec. 2, effective June 26, 2007. -- Amended
2005 Ky. Acts ch. 85, sec. 687, effective June 20, 2005. -- Amended 1990 Ky. Acts
ch. 280, sec. 2, effective July 13, 1990. -- Created 1956 Ky. Acts ch. 243, sec. 2,
effective May 18, 1956.
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