OAR 150-323-0210: Cigarettes Damaged in Transit

The following procedure may be used in lieu of payment of tax and claim for refund: (1) Untaxed cigarettes damaged while being transported from the manufacturer to a bonded warehouse may be: (a) Returned to the manufacturer without the imposition of any tax; or (b) Accepted by a bonded warehouse for the manufacturer who must affix tax paid indicia before they may be returned to the carrier for salvage. Cigarettes damaged to the extent that indicia cannot be affixed and not returned to the manufacturer or otherwise disposed of outside of Oregon, must be accepted and retained by the warehouse until they can be destroyed in the presence of a representative of the Department. (2) Untaxed cigarettes damaged while being transported between a bonded warehouse and a licensed distributor must be accepted by the distributor for the purpose of affixing tax paid indicia. They may be returned to the carrier for salvage purposes only after such indicia has been affixed. Cigarettes damaged to the extent that indicia cannot be affixed and not returned to the manufacturer or otherwise disposed of outside of Oregon, must be accepted and retained by the distributor until they can be destroyed in the presence of a representative of the Department. (3) Untaxed cigarettes damaged while being transported from a point outside Oregon to a consignee, other than a bonded warehouse within Oregon, may either be returned to the consignor without the imposition of any tax, or may be accepted by the consignee for the purpose of affixing tax indicia before being returned to the carrier for salvage purposes. Cigarettes damaged to the extent that indicia cannot be affixed and which are not returned to the consignor or otherwise disposed of outside of Oregon must be accepted and retained by the consignee until they can be destroyed in the presence of a representative of the Department.