Chap. 118.—An ACT to amend and re-enact Sections 10 and 11 of Chapter 3
of the Acts of Assembly, Extra Session, 1933, known as the 3.2 Hey eag
Act, as heretofore amended, in relation to excise taxes. {H 22]

Approved March 5, 1948

Be it enacted by the General Assembly of Virginia:

1. That sections ten and eleven of chapter three of the Acts
of Assembly, extra session, nineteen hundred thirty-three, as here-
tofore amended, be amended and reenacted so as to read as follows:

Section 10. (a) There is hereby levied on all beverages manu-
factured in Virginia an excise tax at the rate of three dollars and
ten cents per barrel of thirty-one gallons, and a tax at the same rate
on such beverages in containers of more or less than thirty-one
gallons, but on such beverages in bottles of not more than seven
ounces each the tax shall be one and one-half cents per bottle, and
on such beverages in bottles of more than seven ounces each but
not more than twelve ounces each the tax shall be two cents per
bottle; and on such beverages in bottles of more than twelve
ounces each, the tax shall be at the rate of one and two-thirds mills
per ounce per bottle. Such tax shall be paid by the person who
manufactures the said beverages.

(b) There is hereby levied on all beverages bottled in Virginia
and on all beverages sold in Virginia, an excise tax at the rate of
three dollars and ten cents per barrel of thirty-one gallons, and a
tax at the same rate on such beverages in containers of more or
less than thirty-one gallons, but on such beverages in bottles of
not more than seven ounces each the tax shall be one and one-half
cents per bottle, and on such beverages in bottles of more than
seven ounces each but not more than twelve ounces each the tax
shall be two cents per bottle; and on such beverages in bottles of
more than twelve ounces each, the tax shall be at the rate of one
and two-thirds mills per ounce per bottle. The tax herein levied
shall be paid by the respective bottlers and wholesalers of the said
beverages, if not previously paid. No such tax shall be collected
upon any beverages bottled or sold in Virginia when the State
excise tax provided in this act shall have been previously levied
and paid thereon in full; but if on beverages bottled in Virginia
there shall have been paid by the manufacturer the excise tax
herein levied, such bottler shall pay all additional excise taxes
which may be due on such beverages in bottled form.

(c) When any person shall sell or offer for sale in Virginia
any beverages purchased or obtained from any person not licensed
either as a manufacturer, bottler, or wholesaler under the provisions
of this act, and on which the State excise tax herein levied has not
been paid, such person shall pay the tax levied in the preceding
subsection. No license issued to a retailer under this act shall be
valid unless and until such retailer shall have filed with the State
Tax Commissioner a satisfactory contract or agreement with the
State Tax Commissioner that such retailer will purchase for resale
beverages from manufacturers, wholesalers or bottlers licensed in
this State and from no one else; provided, however, that any corpo-
ration licensed to sell beverages on dining cars, buffet cars, club
cars and/or boats may, in lieu of filing such a contract or agree-
ment, file with the State Tax Commissioner a bond, with a guaranty
or surety company licensed to do business in this State as surety,
in such penalty as the said Commissioner may find to be sufficient
to cover the tax liability of such corporation, but in no event to be
less than one thousand dollars. The violation of the terms of any
such contract or agreement between any such retailer and the
State Tax Commissioner by the purchase by such retailer of any
beverages for resale from any one other than a manufacturer,
bottler, or wholesaler licensed in this State shall automatically
revoke the license of any such retailer and such retailer shall more-
over be guilty of a misdemeanor.

(d) On or before the tenth day of each month every person
manufacturing, bottling or selling any beverages in Virginia shall
file with the State Tax Commissioner a report under oath on forms
which shall be prescribed by the State Tax Commissioner showing
the quantity of all beverages, manufactured, bottled and/or sold
by such person during the preceding month, the amount of tax,
if any, for which such person is liable under the provisions of this
act, and containing such other information as the State Tax Com-
missioner may require. At the same time such person shall pay to
the State Tax Commissioner all such excise taxes chargeable
against him under the provisions of this act on all such beverages
so manufactured, bottled and/or sold during the preceding month,
unless such taxes have been previously paid. The provisions of this
subsection as to the filing of such monthly reports shall not be
applicable to any retailer who purchased beverages from manufac-
turers, wholesalers or bottlers licensed in this State and from no
one else; provided, such retailer shall have duly filed with the State
Tax Commissioner the contract or agreement mentioned in the
preceding subsection.

(e) The excise tax herein provided for shall not be chargeable
against any manufacturer, bottler or wholesaler on any beverages
shipped out of this State by such manufacturer, bottler or whole-
saler for resale out of this State, or on any beverages shipped to
a United States military or naval reservation within the geograph-
ical confines of Virginia for resale on such military or naval reser-
vation, or on any beverages shipped to a post exchange of the
armed forces of the United States for resale by such post exchange,
whether such post exchange be located on a United States military
or naval reservation or not, or on any beverages shipped to any
instrumentality of the United States which is exempt on constitu-
tional grounds from the excise tax I¢¥ied by this section, provided
evidence satisfactory to the State Tax Commissioner be submitted
to him in writing in each case that such beverages were so shipped.

(f) All monies collected by the State Tax Commissioner under
the provisions of this act shall be promptly paid into the general
fund of the State treasury.

(g) This section, as hereby amended, shall be in force on and
after July first, nineteen hundred forty-eight.

Section 11. (a) The payment of the taxes imposed by the
preceding section shall be evidenced, as to containers other than
bottles as defined by this act, by the affixing of stamps to the
original containers in which beverages are placed, received, stored,
shipped or handled, and, as to containers consisting of bottles, as
defined by this act, by the affixing of crowns or lids to such con-
tainers in which beverages are placed, received, stored, shipped or
handled. Stamps shall be affixed in such manner that their removal
will require continued application of steam or water. The term
“bottle” shall mean any vessel intended to contain liquids and
having a capacity of not more than forty-three ounces.

(b) Except as may be otherwise provided herein, each manu-
facturer or bottler of beverages in this State shall, within twenty-
four hours after the beverages are placed in an original container
or bottles, and prior to delivery of any container of beverages to
any wholesaler, jobber, retailer, distributor, or any other person
whatsoever in this State, affix the proper stamp, crown, or lid to
each container and wherever a stamp is used, cancel the stamp so
afixed by writing or stamping across the face thereof the name
of such manufacturer or bottler and the date of such cancellation.

(c) Except as may be otherwise provided herein, and unless
such stamps, crowns or lids have been previously affixed, such
stamps, crowns or lids shall be affixed as herein provided by each
wholesaler in this State within twenty-four hours after such bever-
ages come into the possession of such wholesaler and prior to the
delivery of any container thereof to any retailer or other person in
this State, and stamps wherever used, shall be cancelled by writing
or stamping across the face thereof the name of such wholesaler
and the date of such cancellation.

_ (d) Each retailer in this State immediately upon the receipt
ot any beverages at his place of business, and prior to disposing
ot the same in any way, shall affix such stamps, crowns or lids to
each container thereof unless such stamps, crowns or lids shall
have been previously affixed thereto, and wherever stamps are
used, he shall cancel the same by writing or stamping across the
face thereof the name of such retailer and the date of such
cancellation.

(e) The State Tax Commissioner shall prescribe, prepare,
furnish and sell the stamps provided for in this section, in such
denominations and quantities as may be necessary, for the pay-
ment of the tax imposed by this act. The crowns and lids provided
for in this section shall be prescribed by the State Tax Commis-
sioner, and under rules and regulations prescribed by the State
Tax Commissioner they shall be purchased by the manufacturer
or other person, after the payment of the tax imposed by this act,
only from such persons, firms or corporations as may be designated
as manufacturers of such crowns and lids by the State Tax Com-
missioner. The State Tax Commissioner is authorized to enter into
contracts on behalf of the State with one or more manufacturers
for the manufacture, sale and distribution of such crowns or lids,
and shall require of such persons, firms and corporations so manu-
facturing, selling and distributing such crowns or lids a bond or
bonds, with a company authorized to do business in this State as
surety, payable to the Commonwealth of Virginia, in such penalty
and upon such conditions as in the opinion. of the State Tax Com-
missioner will adequately protect the State. The crowns and lids
shall be manufactured, sold and distributed at the cost of the
taxpayer.

The State Tax Commissioner shall prescribe crowns of different
colors for malt beverages in the lower price classification from
colors prescribed for malt beverages in the higher price classifica-
tion, and in releasing such crowns shall act on representations made
by the manufacturer as to the expected or probable retail selling
prices of his products.

(f) At the time of delivering beverages to any person, each
manufacturer and wholesaler in this State shall make a true dupli-
cate invoice showing the date of delivery, the amount and value of
each shipment of beverages delivered, and the name of the pur-
chaser to whom the delivery is made, and shall retain the same
for a period of two years, subject to the use and inspection of the
Alcoholic Beverage Control Board, the State Tax Commissioner,
and their agents or the agents of either of them.

(g) Persons operating boats, dining cars, buffet cars and club
cars upon or in which beverages are sold shall not be required to
evidence the payment of the tax herein provided for by affixing
stamps, crowns or lids, as provided for in this section, but instead
shall keep such records of the sales of such beverages in this
Commonwealth as the State Tax Commissioner shall prescribe and
shall submit monthly reports of such sales to the State Tax
Commissioner upon a form prescribed therefor by said State Tax
Commissioner and shall pay the tax levied under section ten of this
act at the time such reports are filed.

(h) It is the intent and purpose of this section to require all
manufacturers and other persons, except as herein provided, to
affix the stamps, crowns or lids provided for in this section to all
original containers in which beverages are normally placed, pre-
pared for market, received, sold or handled before such beverages
are sold, offered for sale, or held for sale within this State.
(i) Any manufacturer or other person, except as herein pro-
vided, who shall sell beverages to wholesalers, retailers or con-
sumers, without affixing to the containers the stamps, crowns or
lids required by this act, and any person, except as herein provided,
who shall purchase, receive, transport, store or sell any beverages
in containers to which the stamps, crowns or lids required by this
act are not affixed, shall be deemed guilty of a misdemeanor,
and upon conviction thereof, shall be punished by being fined not
less than one hundred dollars nor more than five hundred dollars,
or by being confined in jail for a term not exceeding six months,
or by both such fine and confinement in jail in the discretion of the
jury, or of the justice, or of the court trying the case without a jury.
In addition such person shall be liable for the taxes due under this
act with interest at the rate of twelve per centum per annum from
the date such taxes were due and payable. The State Tax Commis-
sioner shall have authority to assess said taxes and interest and to
cause the same to be collected in the same manner provided for the
collection of taxes generally.

(j) Manufacturers or other vendors of beverages from without
this State shall affix the stamps, crowns or lids to original con-
tainers of beverages to be sold, offered for sale, held for sale, deliv-
ered, or transported for delivery in this State.

(k) The State Tax Commissioner shall promulgate rules and
regulations to relieve manufacturers and bottlers of beverages from
the liability to affix stamps, crowns or lids on such beverages as are
intended to be shipped and are thereafter shipped out of this State
by such manufacturers and bottlers for resale out of this State.

(1) Any person who falsely or fraudulently makes, forges,
alters or counterfeits any stamps, crowns or lids prescribed by the
State Tax Commissioner under the provisions of this section, or
causes or procures to be falsely or fraudulently made, forged,
altered or counterfeited any such stamps, crowns or lids, or know-
ingly or wilfully utters, passes or tenders as true any such false,
forged, altered or counterfeited stamps, crowns or lids, or uses
more than once any stamp, crown or lid provided for and required
by this act, for the purpose of evading the tax imposed under this
act, or for the purpose of aiding or abetting others to evade the
tax imposed under this act, shall be guilty of a felony, and, upon
conviction thereof, shall be punished by confinement in the peni-
tentiary for not less than two years nor more than five years.

(m) Whoever, being a retailer or wholesaler in this State, has
in his possession a container or containers of beverages not bearing
the stamps, crowns or lids required to be affixed to each such con-
tainer; or fails to produce, upon demand by the State Tax Com-
missioner, or the Alcoholic Beverage Control Board, invoices of
all beverages purchased or received by him within two years prior
to such demand, unless upon satisfactory proof it is shown that
such non-production is due to providential or other causes beyond
his control, shall be guilty of a misdemeanor and upon conviction
thereof be fined not less than twenty-five dollars, nor more than
one hundred dollars.

(n) Any person who shall fail, neglect, or refuse to comply
with or shall violate any provision of this section, for which viola-
tion no specific penalty is provided, or any of the rules and regula-
tions prescribed, adopted and promulgated by the State Tax Com-
missioner under the provisions of this section, or who shall refuse
to permit the State Tax Commissioner, or the Alcoholic Beverage
Control Board, or their agents or the agents of either of them, to
examine his books, papers, invoices, and other records, his stock
of beverages in and upon any premises where the same are manu-
factured, bottled, stored, sold, offered for sale, or held for sale,
shall be guilty of a misdemeanor, and, upon conviction thereof, shall
be fined not less than one hundred dollars nor more than five hun-
dred dollars, or confined in jail not more than six months, or both,
in the discretion of the jury, or of the justice, or of the court trying
the case without jury.

(0) The State Tax Commissioner is hereby charged with the
enforcement of the provisions of this section, and is hereby author-
ized and empowered to prescribe, adopt, promulgate, and enforce
rules and regulations relating to any matter or thing pertaining to
the administration and enforcement of the provisions of this section
and the collection of taxes, penalties, and interest imposed by this
act,

(p) The State Tax Commissioner is hereby authorized to
prescribe, adopt, promulgate and enforce rules and regulations
relating to the transportation of beverages through this State and
from points outside of this State to points within this State, and
to prescribe, adopt, promulgate, and enforce rules and regulations
reciprocal to those of, or laws of, any other state or territory
affecting the transportation of beverages manufactured in this
State.

(q) The State Tax Commissioner may waive so much of sub-
section (d) of section ten of this act as he may regard unnecessary
for the efficient administration of this act.

(r) In the event that the method prescribed in this section
for the payment and collection of the taxes imposed by section ten
of this act shall become inoperative at any time then such taxes
shall be paid and collected as provided in section ten, and in addi-
tion the State Tax Commissioner shall have authority and it shall
be his duty to assess and collect such back taxes as may be due
and payable but unpaid under the provisions of section ten.

(s) Whenever it is proven to the satisfaction of the State Tax
Commissioner that any person has purchased and used stamps.
crowns or lids upon beverages that have been sold by him in such
manner as are exempt from the excise tax levied under section ten,
the State Tax Commissioner shall issue a certificate to said person
whereby said person or his assignee is entitled to obtain without
payment of the tax otherwise represented by said crowns and lids,
from the person, firm, or corporation, designated therein as one
of the manufacturers of crowns or lids, an amount of crowns or
lids having the same aggregate tax value as the amount of tax
represented by said crowns or lids so used upon the exempt bev-
erages, and the State Tax Commissioner shall issue and deliver
without further cost, to said person or his assignee an amount of
stamps having the same aggregate tax value as the amount of
stamps so used by him upon such exempt beverages.

(t) In order that the increases in the rates of the excise taxes
levied by section ten of this act, as amended, may be made uni-
formly effective on July first, nineteen hundred forty-eight, the
following provisions are hereby enacted:

(1) Every wholesaler and retailer of beverages in this State
shall file with the State Tax Commissioner after July first, nineteen
hundred forty-eight and before July fifteenth, nineteen hundred
forty-eight, a report under oath on forms which shall be prescribed
by the State Tax Commissioner which report shall state in detail
such wholesaler’s or retailer’s inventory of beverages on which the
excise tax is increased by section ten of this act, as amended, on
hand, and in transit to him as of the beginning of July first, nine-
teen hundred forty-eight, and at the time of filing such report he
shall pay to the State Tax Commissioner the difference between
the excise taxes which have been already paid this State on such
beverages and the excise taxes at the rates levied by section ten
oi this act, as amended. Any such wholesaler or retailer failing or
refusing to file such report and to pay such taxes within the time
prescribed hereby, shall be guilty of a misdemeanor, and on con-
viction thereof, shall be punished accordingly ; and, in addition, the
State Tax Commissioner shall proceed to collect such taxes by
legal process.

(2) Every manufacturer and bottler of beverages in this State
and every manufacturer, bottler and wholesaler of beverages with-
out this State, to whom or on whose account any official crown or
lid tax certificates has been at any time issued before July first,
nineteen hundred forty-eight or who has purchased or acquired at
any time before July first, nineteen hundred forty-eight any tax
stamps, shall file with the State Tax Commissioner after July first,
nineteen hundred forty-eight and before July fifteenth, nineteen
hundred forty-eight, a report under oath on forms wliiich shall be
prescribed by the State Tax Commissioner which report shall give
in detail the number and description of each class of official crowns,
lids and tax stamps for use on beverages on which the excise tax
is increased by section ten of this act, as amended, which such
manufacturer, bottler or wholesaler may have on hand, or in transit
to him as of the beginning of July first, nineteen hundred forty-
eight, and whether such official crowns, lids and tax stamps be
attached or unattached to containers; and at the time of filing such
report he shall pay to the State Tax Commissioner the difference
between the excise taxes which have been already paid this State
on account of such official crowns, lids and tax stamps and the
excise taxes at the rates levied by section ten of this act, as
amended. Any such manufacturer or bottler in this State failing
or refusing to file such report and to pay such taxes within the
time prescribed hereby, shall be guilty of a misdemeanor, and on
conviction thereof, shall be punished accordingly ; and, in addition,
the State Tax Commissioner shall proceed to collect such taxes
by legal process. Any such manufacturer, bottler or wholesaler
without this State failing or refusing to file such report and to
pay such taxes within the time prescribed hereby, shall not be
issued any official crown or lid tax certificate or permitted to
purchase any tax stamps so long as such manufacturer, bottler
or wholesaler may be in default, as aforesaid.

(u) This section, as hereby amended, shall be in force on and
after July first, nineteen hundred forty-eight; provided, however,
that the State Tax Commissioner shall have authority before that
date, to make provision for the furnishing of stamps, crowns and
lids required herein.