Department of Taxation and Finance

Instructions for Form MT-200.5 Alternative Nicotine Products Floor Tax Return

MT-200.5-I

(9/26)

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General information

Effective September 1, 2026, the New York State tobacco products tax is extended to alternative nicotine products. The tax is imposed at the rate of 75% of the wholesale price of the product.

Filing requirements

Distributors generally pay the tobacco products tax. However, because the tax has not been paid on alternative nicotine products held in inventories of distributors, wholesale dealers, and retail dealers, all sellers of these products must pay tax on the inventory in their possession as of 11:59 p.m. Eastern Standard Time on August 31, 2026. The floor tax return is due by September 21, 2026.

Definitions

Tobacco products means any cigar, including a little cigar, tobacco, or alternative nicotine product, other than cigarettes, intended for consumption by smoking, chewing, or as snuff.

Alternative nicotine products are any noncombustible products, other than vapor products, which contain nicotine, but not tobacco, and are intended for human consumption, whether chewed, absorbed, dissolved, or ingested by any other means. Alternative nicotine products do not include any product regulated as a drug or device by the U.S. Food and Drug Administration (FDA) under 21 U.S.C. § 351 and the sections that follow. For example, certain smoking cessation drugs and devices regulated by the FDA are not considered alternative nicotine products.

Wholesale price means the price for which the tobacco products are sold to a distributor, before the allowance of any discount, trade allowance, rebate or other reduction, and including the federal excise taxes paid by the seller. The invoice received by a distributor for its purchase of a tobacco product is presumptive evidence of the wholesale price of the tobacco product. For purposes of the floor tax only, retail dealers may use 50% of their selling price (excluding sales tax) as the wholesale price.

Unit as it relates to alternative nicotine products, means any cannister, pack, box, carton, or container of any kind or, if no other container, any wrapping, in which an alternative nicotine product is offered for sale, sold, or otherwise distributed to consumers.

Distributor means any person who imports or causes to be imported into this state any tobacco product (in excess of 50 cigars, 1 pound of tobacco, or 15 units of alternative nicotine products) for sale, or who manufactures any tobacco product in this state, and any person within or outside the state who is authorized by the commissioner of taxation and finance to file returns and pay the tax on tobacco products sold, shipped or delivered by them to any person in the state.

Specific instructions

Taxpayer information

Enter your wholesale dealer license number and distributor license number, if applicable.

Enter your sales tax identification number.

Enter the business name as it appears on your sales tax registration and your complete street address, including city or village or post office, state, and ZIP code.

Lines 4 and 5

If you are not filing this return and remitting your tax by September 21, 2026, you must pay penalty and interest. See Penalties and interest.

Change of business information

If your name, sales tax identification number, address, or owner or officer information has changed, see Update your personal or business information.

Additional forms: If you have more entries than will fit on the lines provided in Schedule A or B, submit additional Forms MT-200.5 completing only the necessary schedules. Include your business name and identification number on each form and submit them with your return.

Schedule A: All vendors other than vending machine operators

Any business selling alternative nicotine products from more than one location must file one consolidated floor tax return. Take an inventory of stock on hand at each location and keep the original inventory report at each one.

Enter the business name, address, sales tax identification number (if different from the one on page 1), and inventory of all the units of alternative nicotine products from each location on this schedule of the consolidated return.

Schedule B: Vending machine operators

Vending machine operators must complete a physical inventory of as many machines as possible by 11:59 p.m. Eastern Standard Time on August 31, 2026. For each machine where this is not possible, the operator must estimate the inventory at one-half of the machine’s normal fill capacity based on its individual inventory records.

Normal fill capacity is the inventory as indicated on the individual inventory records maintained for each vending machine on location.

Example: 

The normal fill capacity of a vending machine operator's vending machine is 600 units of alternative nicotine products. The wholesale price of each unit is $4.00. The Tax Department will permit the operator to report the floor tax based on one-half of 600, or 300 units of alternative nicotine products at 75% (0.75) of the wholesale price. The alternative nicotine product floor tax due is $900 (300 x $4.00 x 0.75) for each of the machines listed in Schedule B.

Recordkeeping

Distributors and dealers who store or sell units of alternative nicotine products must:

• keep the original inventory reports at each separate business location for inspection,
• keep all physical inventory records used to arrive at the amount of alternative nicotine products floor tax due, and
• make their records available to the Tax Department upon request.

Penalties and interest

Failure to file a return or pay the tax due by September 21, 2026, will result in civil penalties and interest under New York State Tax Law Article 20 and may result in criminal penalties under New York State Tax Law Article 37.

Penalty is imposed at the rate of 10% of the tax due for the first month or any fraction of a month, plus 1% of the tax due for each subsequent month or fraction of a month in which a return remains unfiled or the tax remains unpaid, up to a maximum of 30%.

If any return is not filed within 60 days of the due date, the minimum penalty may not be less than the lesser of the tax due or $100.

Interest is due on any late payment or underpayment and accrues from the due date of the return to the date the tax is paid. Interest rates are compounded daily and adjusted quarterly.

You may calculate your penalty and interest by using our online Penalty and interest calculator (visit www.tax.ny.gov and search: penalty), or you may call and we will calculate the penalty and interest for you (see Need help?).

Payment information

Line 7: Make your check or money order, payable in U.S. funds, to NYS Floor Tax.

On your check or money order, write Form MT-200.5 and your sales tax identification number.

Fee for payments returned by banks

The law allows the Tax Department to charge a $50 fee when a check, money order, or electronic payment is returned by a bank for nonpayment. However, if an electronic payment is returned as a result of an error by the bank or the department, the department won't charge the fee. If your payment is returned, we will send a separate bill for $50 for each return or other tax document associated with the return payment.

Mailing address

Mail your return, attachments, and payment to:

Private delivery services: If you choose, you may use a private delivery service, instead of the U.S. Postal Service, to mail in your form and tax payment. However, if, at a later date, you need to establish the date you filed or paid your tax, you cannot use the date recorded by a private delivery service unless you used a delivery service that has been designated by the U.S. Secretary of the Treasury or the Commissioner of Taxation and Finance. (Currently designated delivery services are listed in Publication 55, Designated Private Delivery Services. See Need help? for information on obtaining forms and publications.) If you have used a designated private delivery service and need to establish the date you filed your form, contact that private delivery service for instructions on how to obtain written proof of the date your form was given to the delivery service for delivery. If you use any private delivery service, whether it is a designated service or not, send the forms covered by these instructions to: NYS Tax Department, RPC-Misc Tax, 90 Cohoes Ave, Green Island NY 12183.

Need help?

Visit our website at www.tax.ny.gov

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Telephone assistance

Privacy notification

New York State Law requires all government agencies that maintain a system of records to provide notification of the legal authority for any request for personal information, the principal purposes for which the information is to be collected, and where it will be maintained. To view this information, visit our website or, if you do not have Internet access, call and request Publication 54, Privacy Notification. See Need help? for the web address and telephone number.