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$10,426 Tax Bill For Smoker Who Bought Cigs Over Internet
NBC-10 ^ | February 4, 2007

Posted on 02/04/2007 4:51:40 PM PST by Malacoda

BRICK, N.J. -- New Jersey residents who buy their cigarettes over the Internet are experiencing a big reason to quit: huge sales tax bills.

The state is cracking down on residents who buy their smokes online in order to avoid state sales tax, a development that has caught many Garden State smokers by surprise.

Brick resident Craig Mathews, 57, quit smoking last April, but not before racking up a $10,426.11 sales tax bill for buying cigarettes over the Web for years.

Another Brick resident, Tim Nolan, 52, received a sales tax bill from the state for $4,115.28 for the Pall Mall cigarettes he purchased online from July 2003 to March 2005.

Both men said they bought the cigarettes over the Internet in order to save money and didn't know that they had to pay sales tax to the state of New Jersey.

"We should have gotten a warning," Nolan told the Asbury Park Press for Sunday's newspapers. "We were ignorant of the law."

A professor at Rutgers School of Law, Mark Weiner, said under a federal law called the Jenkins Act, tobacco companies who sell their products to out-of-state consumers must report sales information to the state where the consumer lives.

According to Tom Vincz, a spokesman for the state Treasury Department, the state collects about $4 million a year from sales tax on out-of-state cigarettes.

Vincz said sometimes cigarette sellers will voluntarily offer the information to states, but often the states must demand it from the Internet sites.


TOPICS: Business/Economy; Culture/Society; Government; US: New Jersey
KEYWORDS: addiction; cancer; emphysema; pufflisttaxes
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1 posted on 02/04/2007 4:51:42 PM PST by Malacoda
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To: SheLion

Ping.


2 posted on 02/04/2007 4:52:10 PM PST by Malacoda (A day without a pi$$ed-off muslim is like a day without sunshine.)
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To: Malacoda
under a federal law called the Jenkins Act, tobacco companies who sell their products to out-of-state consumers must report sales information to the state where the consumer lives.

Why is only the tobacco industry subject to these reporting laws? What's next?

3 posted on 02/04/2007 4:56:16 PM PST by rhombus
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To: Malacoda

Offshore companies don't have to report anything.


4 posted on 02/04/2007 4:56:26 PM PST by xcamel (Press to Test, Release to Detonate)
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To: Malacoda

"We were ignorant of the law."

Were you also igorant of the fact that ignorance of the law is no excuse? C'mon. Quit it.


5 posted on 02/04/2007 4:56:31 PM PST by at bay ("We actually did an evil....." Eric Schmidt, CEO Google)
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To: Malacoda

One word.
LIBERALS.


6 posted on 02/04/2007 4:57:40 PM PST by BuffaloJack
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To: at bay
Actually, I'm not a smoker, so it doesn't affect me one way or t'other. You'll notice I posted without additional commentary.

I DO think that they deserved a warning, though. Eleven thousand dollars is a lot to come up with on short notice, and the Demokratik republik of Gnu Jerksey is sort of notorious for this crap.

7 posted on 02/04/2007 4:59:36 PM PST by Malacoda (A day without a pi$$ed-off muslim is like a day without sunshine.)
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To: Malacoda

Why do you have to report that you bought cigarettes in the first place?


8 posted on 02/04/2007 5:00:19 PM PST by Dallas59 (HAPPY NEW YEAR 2007!)
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To: Malacoda

Government and business are the only ones that are "entitled" to cross state lines for the cheapest rate. The rest of us have the tax bill to pay and make up for lost taxes while the states continue to send more and more services out of state or country to be performed for the cheapest wage.


9 posted on 02/04/2007 5:03:21 PM PST by Snoopers-868th
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To: Dallas59

YOU don't report it ---- Internet & Credit Card companys get subpoenas.


10 posted on 02/04/2007 5:03:32 PM PST by GoldCountryRedneck ("Idiocy - Never under estimate the power of stupid people in large numbers" - despair.com)
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To: Malacoda
New Jersey residents who buy their cigarettes over the Internet are experiencing a big reason to quit get out of New Jersey as fast as they can: huge sales tax bills.
11 posted on 02/04/2007 5:05:03 PM PST by Lancey Howard
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To: xcamel
Offshore companies don't have to report anything.

They do to Customs.

12 posted on 02/04/2007 5:06:02 PM PST by ReignOfError
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To: at bay
"We were ignorant of the law."

"Were you also igorant of the fact that ignorance of the law is no excuse? C'mon. Quit it".

Seems to me, the vendor should be responsible for collecting sales taxes.

As far as ignorance of the law, who could possibly keep track and be aware of every law on the books? Thousands of new laws are past every year.

Every one of us probably does something illegal everyday and don't even realize it
13 posted on 02/04/2007 5:08:59 PM PST by Las Vegas Ron (Free Scooter Now!)
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To: rhombus
What's next?

Out of state purchases of anything.....Depends on how hard up your state is for money and what they are willing to do to get your taxes

Watch the big time internet sales giants such as L.L.Bean, Cabela's, etc. start getting inquiries from the states such as Michigan for their sales records then start going after the customers. Myself, I was nailed for for tobacco taxes last year and when those bastards get you in their sights, you are guilty even if you can prove your innocence......

14 posted on 02/04/2007 5:09:44 PM PST by Hot Tabasco
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To: Dallas59
Why do you have to report that you bought cigarettes in the first place?

You don't but you are responsible to pay the applicable sales tax via your State tax form at the end of the year. The Jenkins Act facilitates each State's collection of taxes on cigarettes by requiring the seller to report to the State Agency the name and address of individuals who purchased from a given state.

15 posted on 02/04/2007 5:10:22 PM PST by Snoopers-868th
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To: Malacoda
How quaint, Government will force Citizens to pay Taxes and yet

1. To get new manufacturing they will lure companies in with super low or zero Tax
2. You can be an Illegal Immigrant and not pay Income Tax
3. Wonder what Kerry or Kennedy's Tax would be if they had to pay the same as everyone else. (sure we can all find Tax loopholes, theirs just seem to be so much more personal, they fit like a tailored suit)
4. People cross City / State lines all the time to get break on Taxes.
5. Wasn't the dim bulb Congress just a few years ago seriously considering sending us to Canada for Prescription drugs.
TT
16 posted on 02/04/2007 5:12:21 PM PST by TexasTransplant (NEMO ME IMPUNE LACESSET)
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To: Malacoda; Just another Joe; CSM; lockjaw02; Publius6961; elkfersupper; nopardons; metesky; Mears; ..

And another Nanny State Insanity PING....


Did these people never get the idea if they LOWERED the tax people would seek to make purchases elsewhere????


17 posted on 02/04/2007 5:13:03 PM PST by Gabz (I like mine with lettuce and tomato, heinz57 and french-fried potatoes)
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To: Malacoda
"$4,115.28 for the Pall Mall cigarettes he purchased online from July 2003 to March 2005."

That's almost 4 packs a day. He won't need to be embalmed.

18 posted on 02/04/2007 5:15:45 PM PST by spunkets
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To: Malacoda

New York and Michigan did the same thing. A congress critter from Wisconsin I believe pointed out the Jenkins Act and states are jumping on the band wagon. What ticks me off about this is the states farm out work to the cheapest wage which reduces revenue and then they spend taxpayer money penalizing these same citizens who try to get the cheapest rate.


19 posted on 02/04/2007 5:16:29 PM PST by Snoopers-868th
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To: Snoopers-868th
I don't think the Jenkins act covers Indian Reservations though.

The state of Michigan made a big stink over that demanding UPS records and now they wont deliver cigarettes in Mi.
20 posted on 02/04/2007 5:16:51 PM PST by Beagle8U (Thompson / Hunter 2008)
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