Michigan Switches to SICPA for Cigarette Tax Stamps

SICPA has finalised the roll-out of its SICPATRACE® platform in the US state of Michigan, under a new five-year contract with the Department of Treasury.

The RED Stamp DTS-120 Digital Tax Stamper (© RED Stamp).

The solution, designed to protect cigarette excise tax collections, will also ensure compliance with the Master Settlement Agreement (MSA) (see below) which requires the accurate recording and reporting of all volumes and brands of cigarettes sold in Michigan, with the aim of maximising payments owed to the state under the regulatory framework of the MSA.

The contract, awarded in October 2021 for an estimated total value of $8.4 million, followed Michigan’s decision to switch to SICPA as its tobacco excise platform and tax stamp provider. The decision was based on a competitive procurement process that identified SICPA as offering the best value in terms of solution, vendor experience and team, and pricing.

Under the contract, SICPA provides approximately 450 million cigarette stamps per year. The pressure-applied stamps carry an encrypted, serialised 2D barcode and multi-layered security features.