Rev. Rul. 54-530

The stamp tax imposed by chapter 92-22 of the Code of Georgia, Annotated, upon every person, firm, corporation, club or association within the state who sells and/or stores and/or receives for the purpose of distribution within the state, cigars or cigarettes or who receives, retains, keeps, possesses, or brings into the state for his own personal use in the state or for the use of any member of his family therein any such unstamped goods, is deductible for Federal income tax purposes under section 164(a) of the Internal Revenue Code of 1954 by one who purchases, affixes and cancels the stamps provided for in that chapter.

The cigar and cigarette tax does not qualify as a retail sales tax within the meaning of section 164(c) of the Code of 1954 and is not deductible for Federal income tax purposes by consumers who purchase the cigars or cigarettes with the stamps already affixed and canceled.