Does anyone actually know what the pact act would mean for a

[sgreger1]

distributor?


Is there anyone here who could detail what would be required if someone wanted to open shop in a place like CA. Not the whole process but just specifically what PACT changes for us here in the states. Jonathon made it sound like it was mianly just a lot more tax paperwork and red tape.

Does anyone with some actual knowledge of the bill and it's implementation have any light to shed on what it would take to do business as an on-line store in the post-PACT era?

[lxskllr]

I think you have to keep a customer list, and send it to the government periodically. You also have to collect taxes for all states to sell to. I haven't been looking from that point of view, so don't take that as gospel. Your best bet would be to contact Jonathon. He should be able to give you information.

[shikitohno]

From what Mr.Snuff has said over at snuffhouse, it involves a couple f things. First, you need to register with the federal government and state governments for all states you plan on selling to. Second, you need to have an age verification system in place like Getsnus has where you enter your address and the last four digits of your social security number. You need to maintain data on who you sell to and what they buy. The big change is regarding how taxes are collected. Under the old rule, the buyer was responsible for declaring any tobacco purchased tax free and paying the tax. Under pact, any vendor who sells in the US must collect all federal, state, and I believe local tax at the time of sale. It might just be state and federal however.

You also have to submit quarterly reports, and obviously cannot use USPS any longer.

Or, you can go the easy route and move to England. I'd recommend that one really.

[GoVegan]

Come on sgreger1 - just go for it!

[sgreger1]

From what Mr.Snuff has said over at snuffhouse, it involves a couple f things. First, you need to register with the federal government and state governments for all states you plan on selling to. Second, you need to have an age verification system in place like Getsnus has where you enter your address and the last four digits of your social security number. You need to maintain data on who you sell to and what they buy. The big change is regarding how taxes are collected. Under the old rule, the buyer was responsible for declaring any tobacco purchased tax free and paying the tax. Under pact, any vendor who sells in the US must collect all federal, state, and I believe local tax at the time of sale. It might just be state and federal however.

You also have to submit quarterly reports, and obviously cannot use USPS any longer.

Or, you can go the easy route and move to England. I'd recommend that one really.

None of that sounds that hard to be honest. And let me get this straight: The old law says people who buy tobaco have to pay taxes on it later, but PACT makes them pay tax at the time of sale? I don't see that as a bad thing actually. I mean it sucks for us but that is how all business is done, you pay tax when you buy it.

None of this sounds like it would be very difficult if one had a little free time, which I do (check my post count lol).


One error I think Jonathon made is that he was trying to be profitable on a NEW small business, which isn't how it works. It takes on average up to 2 years before small businesses could expect to see a profit from their enterprise. If I were to do this and use all the income from sales to invest in a larger product selection and better website or discounts, I think this could be profitable in the long run, despite PACT, which really seems to be nothing more than fixing something that was broken and adding some extra paperwork.


How about a tenured snuson member discount? lolol

I am going to look more into this. I don't think it would be VERY profitable, but I think it could be at least marginally profitable, and would allow me to purchase snus at a wholesale price for myself. I'll have to talk to jonathon more to see what it all entails.

[GoVegan]

You never know - he might even offer to sell you clubsnus.com.

[tom502]

Well, I think if you kept "in state" it would be easy, and only sell FDA approved snus, and advertise, in whatever ways you can. It could work.

[/dev/null]

None of that sounds that hard to be honest. And let me get this straight: The old law says people who buy tobaco have to pay taxes on it later, but PACT makes them pay tax at the time of sale? I don't see that as a bad thing actually. I mean it sucks for us but that is how all business is done, you pay tax when you buy it.

Now ask me if taxing tobacco is right in the first place.

[sgreger1]

None of that sounds that hard to be honest. And let me get this straight: The old law says people who buy tobaco have to pay taxes on it later, but PACT makes them pay tax at the time of sale? I don't see that as a bad thing actually. I mean it sucks for us but that is how all business is done, you pay tax when you buy it.

Now ask me if taxing tobacco is right in the first place.

Don't even get me started on how we are overtaxed and receive little in return.

At least in Europe in places like Sweden they pay high taxes but get an excellent amount of social benefits like healthcare, good vacation time, retirement etc. We get medicaid and social security and that's about it, oh, and a mandate that we have to buy health insurance. Hurray.

[GoVegan]

Lets just hope that clubsnus finds a way to stay in business and no other stores ending up closing. All these little mini markets that supported the Pact Act won't bother to carry snus because the demand isn't there.

[Owens187]

DO IT!!

Remember:

<----customer.

[rickcharles606]

From what Mr.Snuff has said over at snuffhouse, it involves a couple f things. First, you need to register with the federal government and state governments for all states you plan on selling to. Second, you need to have an age verification system in place like Getsnus has where you enter your address and the last four digits of your social security number. You need to maintain data on who you sell to and what they buy. The big change is regarding how taxes are collected. Under the old rule, the buyer was responsible for declaring any tobacco purchased tax free and paying the tax. Under pact, any vendor who sells in the US must collect all federal, state, and I believe local tax at the time of sale. It might just be state and federal however.

You also have to submit quarterly reports, and obviously cannot use USPS any longer.

Or, you can go the easy route and move to England. I'd recommend that one really.

This is exactly correct, but the problem is that EVERY state is completely different. Some will let you pay quarterly, but some want it every month. Some will allow you to pay by ACH, but some want a company check.

This will be a problem for any company that tries to comply with PACT because there's no easy way to do this, month in and month out. However, I do think it can be done, and would be worth it in the long run.

[shikitohno]

Yeah, sgreger, it wouldnt be too hard to start up probably, but the difficult part is that under PACT, you are under legal responsibility to have an age verification system in place, you can only sell brands permitted by the FDA, and you must charge taxes for your users for 50 different states, plus federal tax. You also need to submit those payments and reports to each state to which you sell according to the schedule they require of you, which could be monthly, quarterly, biannually, or annually. That's enough of a pain in the ass as it is, but you'd also have to keep track of the tax laws for those 50 states and update the rates you charge accordingly whenever they change them, and I'd imagine if they're making you pay the state tobacco tax, they're also going to want you charging state sales taxes. In addition, you need to keep track of which states are no gos. For example, I know in Washington it's already supposed to be a felony to ship tobacco commercially to a customer except for large cigars, but I don't know if that applies to services other than USPS. And then you need to run the business, ship orders, and keep track of you accounts.

I don't mean to discourage you, because it would be awesome if you opened up a shop. I just think you're underestimating how much work it would truly involve. It's one thing if you're planning on having a 20 man staff helping you out, but if you're planning on just running this on your own or as a family business, I think it might prove overwhelming. Still, I hope it works out.

[GoVegan]

You might have less competition now though if you do open up a snus store. I just read this article that says that the USPS is banning all tobacco shipments as of 6/29/2010, even those from overseas distributors. Looks like the race will be between getsnus and northerner as they both have US warehouses which will make shipping by UPS a little more feasible.

http://www.csnews.com/csn/cat_manage...04089291&imw=Y

[sgreger1]

Selling in multiple states in general causes a lot of these same paperwork issues. That's why you buy a copy of quickbooks pro to keep it all neat and orderly.

I am extremely good with administrative things and am very organized. I could handle the paperwork, however I am still in question as to whether it would be profitable once you include applicable sales tax and tobacco tax. Plus, how would I get it to the US? I would have to get UPS from sweden? lol. Maybe distributors are exempt from the "no using USPS " thing, but has anyone thought of this?

Think about it, even if they have a US warehouse, without USPS, even the distributors are gonna get charged a fortune to get it to their US warehouse. Anyone have any more info on this?


Edit, also re: your signature: "Fighting for Peace is like Screwing for Virginity!"

I'm sure the jews thought the same thing while hitler was slowly taking over the world. Surely WWII would have been more peaceful if we didn't do something silly like fight for freedom