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Oregon Smokers Beware: Web tobacco buyers targeted for back taxes by state
United Pro Smoker's Newsletter ^ | June 23, 2006

Posted on 06/25/2006 8:10:40 PM PDT by SheLion

The state moved to expand its pursuit of tax dollars from smokers who buy cigarettes over the Internet.

The Department of Revenue — at a cost of $88,000 — sent tax bills late last year to 7,500 smokers who bought cigarettes online without paying Oregon’s tax of $1.18 a pack. Roughly 33 percent of the people who received letters paid their taxes, generating $686,000.

On Thursday, a subcommittee of the Legislative Emergency Board gave preliminary approval to the Department of Revenue to spend another $240,000 to send letters to people listed on another 23,000 invoices.

The full Emergency Board, which doles out money when the full Legislature is not in session, is expected to approve the spending.

State Sen. Frank Morse, R-Albany, noting that an 8-to-1 return is enticing, asked agency officials if even more could be invested in such efforts.

“Are there any additional taxes that could be collected that we are not?” he asked.

There could be.
The state is receiving copies of about 1,400 invoices a month from several online dealers, the Department of Revenue said.

Internet cigarette sellers offer cheaper rates in part because they do not collect state taxes. Under legal pressure, they began turning over customer data to states a year ago. A federal law prohibits retailers from delivering tobacco products across state lines without reporting their sales.

Elizabeth Harchenko, the director of the revenue agency, said it’s impossible to say whether the next group of invoices will yield a similar amount of taxes. While only a third of people responded to the first letters, nobody has the option of not paying, she said.

Those who get a letter and do not pay go into the state’s catalog of people who are delinquent on taxes, and will face fines, penalties and interest.

Cigarette taxes in Oregon add up to about $235 million a year, with about half of the money helping to pay for subsidized health care. The money also goes to smoking cessation efforts, cities and counties, and to the state general fund.

The state estimates 500,000 Oregonians are smokers, and that 3 percent of them are buying their cigarettes over the Internet.


TOPICS: Culture/Society; Government; US: Oregon
KEYWORDS: anti; antismokers; augusta; bans; budget; butts; camel; caribou; chicago; cigar; cigarettes; cigarettetax; commerce; epa; fda; governor; individual; interstate; kool; lawmakers; lewiston; liberty; maine; mainesmokers; marlboro; msa; niconazis; osha; pallmall; pipe; portland; prosmoker; pufflist; quitsmoking; regulation; rico; rights; rinos; ryo; sales; senate; smokers; smoking; smokingbans; taxes; tobacco; winston
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To: Gabz

Yes, I agree that criminals rationalize their behavior and blame others for it.


101 posted on 06/26/2006 10:49:54 AM PDT by Raycpa
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To: Raycpa
I guess it depends on which one has the bigger gun.

So, just because the burglar has a .357 Magnum and I have a .38 revolver - that makes me the criminal?

You're losing ground fast and you're not making any ground up, Ray.

102 posted on 06/26/2006 10:52:17 AM PDT by Just another Joe (Warning: FReeping can be addictive and helpful to your mental health)
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To: Just another Joe
that makes me the criminal?

If you cannot discern that tax evasion is a criminal behavior then there is no hope.

103 posted on 06/26/2006 10:57:13 AM PDT by Raycpa
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To: SheLion
NOT ONCE in the past THREE YEARS has he ask me about if I bought over the Internet. Not once!!!

Did you hire him to prepare your sales and use tax or your income tax? I'll bet he didn't ask about your last dental appointment either.

104 posted on 06/26/2006 10:58:44 AM PDT by Raycpa
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To: Raycpa
Did you hire him to prepare your sales and use tax or your income tax? I'll bet he didn't ask about your last dental appointment either.

That's ok.  I paid the insurance money that if H&R Block screwed up, they would have to pay.  I am worry free, thank you very much!

And don't worry!  I paid enough Maine taxes to MORE then make-up for any loss of cigarette revenue this putrid Maine government would have gotten!

The FEDS treat me well, but the state of Maine sucks!

105 posted on 06/26/2006 1:56:05 PM PDT by SheLion ("If you're legal, you can fly with the Eagle!" - Michael Anthony)
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To: SheLion

>>>>I paid the insurance money that if H&R Block screwed up, they would have to pay.

Does that mean you can't be billed for a tobacco tax?


106 posted on 06/26/2006 2:00:02 PM PDT by Calpernia (Breederville.com)
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To: Raycpa
OK, Ray, let's review.

you start out by implying that anyone who wants to know if their internet vendor turns over lists to any government entitiy is a tax cheat.

In post 45 you state that out-of-state sales (i.e. internet sales) aren't taxed by the home state, yet you seem to imply it's legal for the home state to tax out of-state-sales.
Which is it?

in post 54 you seem to be saying that to be ethical you must apply and meet all government standards and rulings.
Do you really believe that all government rulings apply to ethicality?
Can you be ethical and NOT meet all the standards and rulings?

In post 61 you did not answer the first point I made. It had to do with government standards and rulings.
To my second point you seem to be saying that if it's legal it's ethical and right.
Again, do you really believe that?
Just because it's legal doesn't make it ethical OR right. And if you want I'll dig up some examples.

In post 64 you say there is no double taxing going on.
Does this apply to just the vendor, just the purchaser, or both?
I'd be willing to bet a dollar that the vendor paid taxes in their home state, that price was included in the sale price of the item, and (according to you) the purchaser should be paying ANOTHER tax in THEIR home state.
How is that NOT double taxation?

In post 91 you have a definition of criminal that seems to fit our government to a "T" and yet when I ask you about another similar situation you imply that might makes legality.
Is that it? If they can whup ya they get to make the laws, whether the laws are ethical, moral, or make any sense?

And then , post 103.
Guess all the members of the Boston tea party were criminals, not patriots, huh?

107 posted on 06/26/2006 2:14:57 PM PDT by Just another Joe (Warning: FReeping can be addictive and helpful to your mental health)
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To: SheLion

You miss my point, Your insurance doesn't cover sales and use tax.

>>>Clip

Peace of Mind® Extended Service Plan

....

The Plan does not apply to:

(b) non-individual returns such as employment (including taxes assessed on Form 4137 for income other than allocated tips), corporate, state and local small business, partnership, trust, estate, and gift tax returns;


http://www.hrblock.com/taxes/doing_my_taxes/products/popup/pom_terms.html


108 posted on 06/26/2006 2:14:57 PM PDT by Raycpa
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To: SheLion

And this>>>>

(i) additional taxes, penalties and interest that are assessed as the result of (i) incorrect, incomplete or misleading information that you have given to Block in connection with its preparation of a return;


109 posted on 06/26/2006 2:16:08 PM PDT by Raycpa
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To: Raycpa

I don't see anything on there excepting sales and use taxes.


110 posted on 06/26/2006 2:16:22 PM PDT by Just another Joe (Warning: FReeping can be addictive and helpful to your mental health)
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To: Just another Joe
I don't see anything on there excepting sales and use taxes.

non-individual returns such as.... The language clearly limits the guarantee to anything but individual returns. "SUCH AS" is not all inclusive it is exempletive. Further, HR Block will have a back argument that the indivdual had an obligation to disclose regardless of whether they asked.

111 posted on 06/26/2006 2:25:59 PM PDT by Raycpa
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To: Raycpa
I can see the second point to a degree.
For the first point, isn't that item on the individual return?
112 posted on 06/26/2006 2:30:35 PM PDT by Just another Joe (Warning: FReeping can be addictive and helpful to your mental health)
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To: Calpernia
Does that mean you can't be billed for a tobacco tax?

That never came up.

113 posted on 06/26/2006 2:33:26 PM PDT by SheLion ("If you're legal, you can fly with the Eagle!" - Michael Anthony)
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To: Raycpa
(i) additional taxes, penalties and interest that are assessed as the result of (i) incorrect, incomplete or misleading information that you have given to Block in connection with its preparation of a return;

Listen, before you start rubbing your hands together and licking your lips, remember this:  I HAVE NEVER ORDERED CIGARETTES ONLINE!

So don't think you can turn ME in for anything.  I never ordered cigarettes off of the Internet.  Is that clear?!

114 posted on 06/26/2006 2:35:20 PM PDT by SheLion ("If you're legal, you can fly with the Eagle!" - Michael Anthony)
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To: SheLion

I actually went and got my Audit Defense Contract out. I can't tell if I'm protected either.

I don't even know if I should be concerned since I've tried to pay my tobacco taxes.


115 posted on 06/26/2006 2:38:27 PM PDT by Calpernia (Breederville.com)
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To: Calpernia

ping to me to come back


116 posted on 06/26/2006 2:39:31 PM PDT by Calpernia (Breederville.com)
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To: Just another Joe
in post 45 you state that out-of-state sales (i.e. internet sales) aren't taxed by the home state, yet you seem to imply it's legal for the home state to tax out of-state-sales.

Sorry to confuse you. There are two potential sales that can occur with a nonresident. If shipped to an out-of-state resident the transaction is not taxable. If purchased and delivered to an out-of-state resident while out-of-state then the tax must be paid. If the out-of-state resident returns to his home state with the taxable item he is required to pay the additional tax due if any.

in post 54 you seem to be saying that to be ethical you must apply and meet all government standards and rulings. Do you really believe that all government rulings apply to ethicality?Can you be ethical and NOT meet all the standards and rulings?

One can be unethical but legal. One cannot be ethical and illegal.

In post 61 you did not answer the first point I made. It had to do with government standards and rulings.

You mean your hypothetical 95% tax? Pre-reagan the federal tax rates were 70% and folks followed that law. What point do you feel its right to break the law?

To my second point you seem to be saying that if it's legal it's ethical and right.

Ethical is not same as right. Again, do you really believe that? Just because it's legal doesn't make it ethical OR right. And if you want I'll dig up some examples.

Legal is a subset of ethical. Ethical is a subset of right. I would never encourage or assist another to break a law even if I thought it should be broken or if I myself break it in protest.

If you want to equate smokers engaged in tax evasion as some sort of patriots, you are dead wrong unless these people made public there stands. Otherwise they are simple tax cheats operating and rationalizing their own illegal behavior

In post 64 you say there is no double taxing going on. Does this apply to just the vendor, just the purchaser, or both?

The vendor is not theoritically taxed. The vendor is a collection agent and the buyer is the one being taxed. And no, there is no double taxing. That is not legal and can be remedied very simply.

I'd be willing to bet a dollar that the vendor paid taxes in their home state, that price was included in the sale price of the item, and (according to you) the purchaser should be paying ANOTHER tax in THEIR home state.

Go ahead and bet, you would be wrong. The purchaser is allowed a credit for the tax legally paid to another state. If the tax was charged on the out-of-state delivered sale the purchaser would be able to collect the overpaid tax from that state.

In post 91 you have a definition of criminal that seems to fit our government to a "T" and yet when I ask you about another similar situation you imply that might makes legality.

We are a nation of laws. If you desire to rationalize why following those laws is not correct you are adopting a criminal mind set. The criminal mind never thinks they are doing anything wrong, in fact they believe someone owes them and therefore its their right to be a tax cheat/thief embezzler etc.

Is that it? If they can whup ya they get to make the laws, whether the laws are ethical, moral, or make any sense?

Your rationalizing again. The criminal mind cannot allow itself to do otherwise.

And then , post 103. Guess all the members of the Boston tea party were criminals, not patriots, huh?

If smokers wanted to dump tobacco in protest I might consider that behavior a valid protest but that isn't what these folks are doing. They are evading a tax for their own private benefit and you are calling them patriots. That criminal mind is operating again to rationalize a behavior by appealing to some greater good when all that is happening is a selfish outcome.

117 posted on 06/26/2006 2:42:46 PM PDT by Raycpa
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To: Mears

bump


118 posted on 06/26/2006 2:43:40 PM PDT by Mears
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To: Just another Joe
For the first point, isn't that item on the individual return?

Technically no if there is no entry on the line.

119 posted on 06/26/2006 2:43:47 PM PDT by Raycpa
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To: elkfersupper
Living the outlaw life: Freeing your inner outlaw

I was just thinking about that essay a few days ago. It's been too long since it was posted here. I love it, and it captures my attitude perfectly.

120 posted on 06/26/2006 2:45:17 PM PDT by Still Thinking (Quis custodiet ipsos custodes?)
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