Posts Tagged ‘cigarette_taxes’

What Happens When Cigarette Taxes go Through the Roof?

Sunday, December 16th, 2012

While Alan Greenspan noted, “Whatever you tax, you get less of,” the New York legislature seems to not understand. In one of the least shocking reports I’ve seen, the New York Association of Convenience Stores (NYACS) noted that the state is losing $1.7 billion of tax revenue each year and 6,700 jobs because of cigarette tax evasion. Why would this be?

New Yorkers who can buy cigarettes elsewhere. The study found that many are buying cigarettes from surrounding states, military bases, Indian reservations, and duty free shops. Add in smuggling from low-tax states (there’s undoubtedly a black market) and you have tax avoidance.

Meanwhile, Cook County, Illinois (Chicago) is conducting cigarette raids to enforce the $2 county cigarette tax. A picture is coming into my mind, that of prohibition, where organized crime prospered when alcohol was banned. I’m sure the similarities are just superficial…or maybe they’re not.

Of course, the NYACS would like New York to begin raids like those in Chicago; after all, convenience stores that are obeying the law stand to sell more cigarettes than most other locations. Still, the unintended consequences of increased taxes are obvious to most of us.

California Cigarette Tax Voted Down

Sunday, June 24th, 2012

Proposition 29 on the June ballot in California would have increased cigarette taxes in the state by $1 per pack. On Friday, supporters officially threw in the towel and conceded defeat. Though there are 110,000 votes still to be counted, the measure trails by 28,000 votes and passage appears mathematically impossible.

Indians Win One Against New York

Sunday, June 24th, 2012

No, it’s not the Cleveland Indians beating the Yankees; rather, the St. Regis Mohawk Tribe beat the New York Tax Department. After the New York cigarette tax on name-brand cigarettes sold on Indian lands some tribes decided to make their own cigarettes. The Mohawk tribe sold some of their cigarettes to a Nebraska tribe; New York seized the cigarettes because they didn’t pay the tax. A New York judge ruled that the state couldn’t do that.

Taxdood has more.

Indians and Yankees Head to Extra Innings

Wednesday, September 1st, 2010

No, not the Cleveland Indians and the New York Yankees. Instead, it’s the on-again, off-again battle between the State of New York and the Indian tribes of New York state on collecting cigarette taxes.

The Indian tribes sell cigarettes, and they don’t want to collect New York taxes on cigarettes. They view themselves as sovereign nations, and New York law doesn’t count.

On the other hand, the State of New York believes that it doesn’t matter: If you’re located within the boundaries of New York state (and these tribes are, at least geographically), then cigarette taxes must be collected.

This is a big money maker for the tribes, so this is a battle that will likely drag on and on and on. Today’s salvo had a judge putting a halt to the collection of taxes for at least the next two weeks. It’s as if the Indians scored a run in the top of the 13th inning. We’ll soon see if the Yankees can either tie the score or go ahead.