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.
Oregon smokers who order off of the Internet need to find out just what DEALERS are turning in their customer lists!
ping
Thanks for the ping!
If everyone thinks this is OK, then they better get ready when the state comes after them for their e-bay purchases and sales. Next up is anything else they can think of to squeeze a buck out of.
"Oregon smokers who order off of the Internet need to find out just what DEALERS are turning in their customer lists!"
All the dealers that aren't indian reservation connected are forced by law to turn over copies of their sales.
Given the costs for this enforcement action it would seem Oregon is not making much from its higher cigarette taxes. I'm sure they are also losing tax revenue from smokers getting their nicotine fix from neighboring lower tax states, buying smokes on Indian reservations and enjoying bootlegged cigarettes supplied by organized crime.
I have this neighbor who receives two shipments a week sent from an Indian reservation in Oklahoma by Fedex. She then sells them to local bars for resale. She makes out big time.
*scratches head*
How can this (the state's actions) even be legal?
It's legal because most states don't have just a sales tax but have a sales and use tax. The use tax basically says that you are responsible for reporting and paying the tax on anything you buy if the seller doesn't collect the tax from you.
Thus, anytime, any of us order off the internet or through mail and don't report and pay tax, we are breaking state law. We've all been doing it for years. It's just the state has no way to enforce it, so they don't.
But since the cigarrette people have to report, then the states have a tool they can use.
Whats next????
No self serve gas!!!
Sorry Oregon but what a bunch of nitwits. Did I mention the only reason to go to Oregon is to get someplace else
Also sounds as if she might have a big tax liability.
You have a good point.
The State runs ads in even the lil town newspaper.
Think of all the money total to run ads in all the Oregon newspapers.
The ads are a warning to those who are buying and not paying taxes on internet sales of cigarettes.
You both realize this is big time illegal. I doubt there would be any kind of prosecution over nickel & dime tax evasion for personal use, but commercial sale like this is liable to earn her some time in the pokey.
And we have a great scenic areas.
You can go from the Pacific ocean to the Cascade Waterfalls in a few hours.
Fishing, hunting and much more outdoor life.
Yes the politics and zero tolerance nitwits are a big pain.
If you are lucky enough to have property out of the city in the rural areas it is a peacefu queit life.
Thanks for the ping!
Thanks for the info!
I hope that is true. At least it is what I was assured when I ordered from a NA reservation back east. The legal point is that the 'point of sale' originates ON the reservation, if done with electronic check. Legally, it is the same as driving 100 miles to a reservation, buying 6 months supply and driving back home.
This is absolute BS! It's the American Way to Shop Cheap, and even some of our own FReepers think that it's ok to go after people just because they choose to smoke a legal commodity.
I really believe the good smokers in Oregon should find out 'which' dealers are turning in their customer lists to the state. I think a little boycott would be in order for these idiots! Don't you?
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