California Reverses Course on Excise Tax


The Cigar Association of America (CAA) has been working for over a year to have CDTFA withdraw Special Notice L-698. Special Notice L-698 as drafted was contrary to current law. It caused numerous companies to calculate California state excise taxes at a higher rate, resulting in an overpayment of tax to the state. CAA and member companies met with CDTFA both in person and through numerous conference calls to discuss the problems with L-698 and possible resolutions. Today’s announcement is the result of that work, and welcome news for the industry as a whole.

Companies who need to do so may request a refund online at or using Form CDTFA-101 [link].