Inflation-Driven Adjustments to Civil Money Penalties for Tobacco-Selling Violations
Tuesday, July 26, 2022
By David Gaudet
Inflation affects an entire country’s economy, from big purchases, including homes and cars; to daily expenditures, such as food and gasoline. Not immune are financial penalties for violating federal, state and local regulations.
Known as Civil Money Penalties (CMPs) and managed by the U.S. Department of Health and Human Services (HHS), monetary fines issued against retailers in violation of federal tobacco regulations increased 17% in March. The current maximum amount by frequency of violation are reflected in the table below. Retailers with five or more repeat violations within a 3-year period are subject to No-Tobacco-Sale Orders (NTSO) and may be prohibited from selling regulated tobacco products during a specified window of time.
|
Number of Regulation Violations
|
2021 CMP Amounts
|
Adjusted 2022 CMP Amounts
|
|
1
|
$0
(Licensee issued a warning letter)
|
$0
(Licensee issued a warning letter)
|
|
2 within a 12-month period
|
$301
|
$320
|
|
3 within a 24-month period
|
$601
|
$638
|
|
4 within a 24-month period
|
$2,409
|
$2,559
|
|
5 within a 36-month period
|
$6,022
|
$6,397
|
|
6 within a 48-month period
|
$12,045
|
$12,794
|
Source: U.S. Food & Drug Administration, CTP Compliance & Enforcement
In accordance with the Federal Civil Penalties Inflation Adjustment Act of 2015, HHS is permitted an annual adjustment to monetary penalties once each year prior to Jan. 15, to keep fines in line with inflation. Annual amounts are calculated using the percent increase in the Consumer Price Index for all Urban Consumers each October. The latest adjustment applies to all penalties that occurred on or after March 17, 2022. Adjustments are intended to keep penalties financially relevant, and as worthwhile motivation for licensees to abide by age-restrictive selling practices.
Government-issued penalties of any amount deduct from your bottom-line and erode your business’ reputation. Ensure your employees are properly trained for lawful tobacco sells by enlisting the expertise of The BARS Program. To get started, contact us at barsprogram.com/contact or call 1-877-540-5500. Visit www.barsprogram.com to learn more about The BARS Program.
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