ATF Ruling 78-2
The Bureau of Alcohol, Tobacco and Firearms has been asked whether a cigarette-style smoking product which contains no tobacco and which is contained in a package marked to show that it is a non-tobacco cigarette is subject to tax as a cigarette under the Internal Revenue Code.
Section 5702(b) of the Internal Revenue Code defines a cigarette as "(1) any roll of tobacco wrapped in paper or in any substance not containing tobacco, and (2) any roll of tobacco wrapped in any substance containing tobacco which, because of its appearance, the type of tobacco used in the filler, or its packaging and labeling, is likely to be offered to, or purchased by, consumers as a cigarette described in paragraph (1)."
Tax is imposed by 26 U.S.C. 5701(b) on products defined as cigarettes under 26 U.S.C. 5702(b).
Held, a cigarette-style smoking product which contains no tobacco, tobacco derived component or resin, nicotine or nicotine derivative, or nornicotine or nornicotine derivative is not a cigarette as defined in 26 U.S.C. 5702(b) and is not subject to tax as a cigarette under 26 U.S.C. 5701(b).