Wholesaler vs. Retailer
Any person who deals with tobacco products in Tennessee, other than a retailer, must obtain a license. It is important for a taxpayer to determine which classification its business fits best within before obtaining the license.
Taxpayers that receive, purchase, or sell tobacco products as a secondary wholesaler and acquire only pre-stamped cigarettes and/or other tobacco products on which the tax has been previously paid, but do not sell to the ultimate consumer, must obtain a tobacco distributor license. A taxpayer that obtains a distributor license, cannot also sell to consumers as a retailer.
Taxpayers who maintain wholesale facilities in one or more permanent locations; are in the business of receiving, storing, purchasing, selling at wholesale, importing unstamped tobacco products, or otherwise handling tobacco products for resale at a wholesale price; and sell only to other licensed wholesalers and distributors or retailers but not to the ultimate consumer, must obtain a wholesale dealer and jobber license. This license requires a minimum $2,000 bond. A taxpayer that obtains a wholesaler license, cannot also sell to consumers as a retailer.
In Tennessee, a person cannot be both a wholesaler/distributor and a retailer of tobacco products. See Important Notice 13-10 for more information.