State to start cracking down on Internet smokes sales

NewsDay.com ^ | June 15, 2003 | MICHAEL GORMLEY

[microgood]

ALBANY, N.Y. -- When Audrey Silk sees smokers buying a pack of cigarettes at a convenience store, she rushes over to confront them:

"Why are you buying that here?" she asks.

"Oh,' they tell me, `I always buy from the Indians, I just ran out,"' Silk said. "I don't know anybody who buys cigarettes from the corner store ... Me? I make sure I never run out."

Smokers like Silk, of New York City, say they still won't run out when the state on Wednesday begins to enforce a ban on Internet cigarette sales. The ban is aimed at the Internet retailers, sovereign and tax-free Indian reservations that have long eluded the state's reach as well as the trucking firms they use. The prize would be hundreds of millions of dollars a year in tax revenue lost in Internet sales for a state struggling with a $12 billion deficit.

[Moleman]

all your smokes are belong to us

[microgood]

WA state here too, and I seem to recall police cars sitting outside of Indian reservations looking to stop people and search for cigarettes. What a wonderful state we live in.

I have heard that but never had a problem myself. Last year or so, Locke hired new tobacco cops to stop shipments, but there are not enough to keep track of the Indian reservations.

[Age of Reason]

Are people prohibited by law from buying smokes in another state and bringing them across the state line?

I seem to remember an episode from not that many years back, when Manhattanites were going across the river to New Jersey to shop, because the Jersey sales tax was less than that of New York.

So New York City investigators went to New Jersey parking lots to record the liscense plate numbers of New York Drivers who were parked in New Jersey malls, to investigate whether those drivers paid sales tax to NYC based on purchases made in NJ (something which, I believe, New Yorkers were supposed to voluntarily do).

Public outrage brought an end to such spying.

[Age of Reason]

I live in Washington State and here you can bring them across state lines but then you have to pay tax on them using some form. The Indian reservations also say it is the individual's responsibility to pay the tax and even have forms for you. Basically a pack of cigarettes in Washington without their tax stamp is considered contraband.

LOL. What if one smokes them all before returning home.

Must one still pay the tax on the nicotene in one's system?

[yankeedame]

One wonders how much all this enforcement will cost.

Doesn't matter, they will just raise the taxes on cigarettes to compensate..
=================================

Which, in turn, will drive more folks to more often use "various other" venues to buy their smokes. Which means, in turn, the taxes will have to be raised again....

[pepsi_junkie]

Public outrage brought an end to such spying.

Maybe in NYC, but they still do it in Pennsylvania. There it isnt cigarettes they track, but liquor sales. PA has state run liquor stores which charge an arm and a leg AND are rarely open. People cross over to New Jersey from Philadelphia all the time, hit a liquor store, and go back. Sometimes a pennsylvania cop is following them home, waiting for the bridge crossing to happen. Their system is a serious joke but of course its a democrat run state and they will never reform because it would hurt the unions and it would eliminate some patronage opportunities, so there you go.

[the bottle let me down]

So New York City investigators went to New Jersey parking lots to record the liscense plate numbers of New York Drivers who were parked in New Jersey malls, to investigate whether those drivers paid sales tax to NYC based on purchases made in NJ (something which, I believe, New Yorkers were supposed to voluntarily do).

It's not voluntary, it's the law. Pretty much every state with a sales tax also has a "use tax." Under the terms of this law, residents are supposed to pay the state in which they live the difference between the sales tax paid at the point of purchase and the tax due in the state where the product will be used. This also applies to mail order goods. In other words, just about everybody has broken the use tax law at one point or another because nobody pays volunteers to pay the use tax. This is why the states want to make mail order houses collect the taxes for them.

A few years back, California started getting customs records and sending use tax bills to people who returned from abroad with expesive items. It was not a popular move.

[qam1]

I seem to remember an episode from not that many years back, when Manhattanites were going across the river to New Jersey to shop, because the Jersey sales tax was less than that of New York.

So New York City investigators went to New Jersey parking lots to record the liscense plate numbers of New York Drivers who were parked in New Jersey malls, to investigate whether those drivers paid sales tax to NYC based on purchases made in NJ (something which, I believe, New Yorkers were supposed to voluntarily do).

Public outrage brought an end to such spying.

There is no sales tax on clothes in New Jersey while New Yorkers have to pay >8% depending on the county/city they live in.

It wasn't public outrage that stopped it, In one of the few smart thing New Jersey ever done NJ Police arrested the NYC tax collectors for loitering which put a stop to NYC's spying.

Unfortunately, New Jersey today is totally stupid. They now have the 2nd highest cigarette tax in the country (after NYC not State) and they are looking to raise it more. If they had any brains they would lower the cigarette tax to a reasonable level this way New Yorkers (City and otherwise)instead of buying from the internet would find it worth it to come across the border to buy their cigarettes there and they would make more in tax revenue. But that goes against every Liberal believe they hold.

[Taxman]

It has already cost a ton!

"'Our people will go into stores and customers will say, "I just need a pack now because my order is coming from the Internet,"' said Dan Finkle, a distributor to convenience stores and leader of the Fair Application of Cigarette Taxes group.

"Finkle said his distribution business lost 40 percent of its business _ 20,000 cartons a week at a $500,000 annual loss _ over the last three years as he said huge cigarette taxes drove smokers to Internet purchases.

"He said the losses forced a layoff of 25 people from his 170-person work force."

The NYC dumbass tax and spend Nazis are gonna lose a lotta revenue, and, hopefully, their jobs! In the short run, it is going to be rough for a lot of people.

HST, I hope the next mayoral election has a candidate who promises to rescind all the NYC dumbass smoking taxes and laws.

And that he/she wins, big!

[qam1]

residents are supposed to pay the state in which they live the difference between the sales tax paid at the point of purchase and the tax due in the state where the product will be used.

So if I buy something from New York at a sales tax rate of 8.5% and bring it back to use in New Jersey which has a sales tax of 6% can I send NJ a bill for the difference?

[the bottle let me down]

So if I buy something from New York at a sales tax rate of 8.5% and bring it back to use in New Jersey which has a sales tax of 6% can I send NJ a bill for the difference?

Of course not. The taxpayer always gets the shaft.

[qam1]

Yep, They are dumbasses. It's a never ending cycle of idioticy.

http://www.pressrepublican.com/Archive/2002/10_2002/100820022.htm

10/08/02

Sinners not alone as ‘sin tax’ victims

By MATT SMITH, Ottaway News Service

ALBANY — The idea was to pump up state revenue to subsidize health coverage for the uninsured and provide raises for hospital workers.

But the decision by lawmakers to raise New York’s "sin tax" on cigarettes twice over the last three years also appears to be severely hurting retailers and resulting in the loss of millions of dollars in state tax revenue.

"The trend seemed to be that stores in close proximity to the Indian reservations were the ones hardest hit," said James Calvin, president of the New York Association of Convenience Stores.

"But now, there’s no difference between the businesses near reservations or border states and those that are two or three hours away."

Calvin blames that on the Internet, where smokers looking to avoid the state’s $1.50-per-pack excise tax can purchase cigarettes tax free.

"There’s been a stampede to evade the tax," he said.

Excluding gasoline purchases, cigarette sales make up roughly 35 percent of all convenience-store business, according to industry estimates.

Calvin points out that when cigarette sales fall off, so too do sales of items such as bread, newspapers and coffee.

And, as a result of cigarette-tax hikes, convenient stores statewide are losing "well in excess of $1 billion per year," he said.

Since late 1999, state lawmakers have raised cigarette excise taxes by 94 cents per pack, pushing the cost for a pack of brand-name cigarettes north of New York City anywhere from $5.25 to $6.

Smokers in the Big Apple, meanwhile, where the city raised its own tax this year, pay about $7 per pack.

But while New York lawmakers say such tax hikes are needed to pay for important government programs, they also say they hope higher cigarette prices will encourage people to quit using tobacco — especially since smoking in New York state accounts for $3 billion a year in direct health-care costs.

"All the science shows that an increase in the cigarette tax is the single most powerful way of decreasing tobacco use," said Russell Sciandra, director of the Center for a Tobacco Free New York. "And, as a matter of social policy, it’s a good thing to discourage smoking."

There is evidence to suggest that’s happening, too. The State Health Department reports that between January 2000 and February 2002, some 70,000 calls have been made to New York’s toll-free smokers’ Quitline.

Still, fewer smokers mean less cash for state coffers.

For example, records from the State Comptroller’s Office show that between April of this year, when the $1.50-per-pack tax went into effect, and July, cigarette and tobacco taxes generated $180 million for the state’s general fund.

But in 1999, when the state’s cigarette tax was 56 cents per pack, taxes on cigarette and tobacco products during the same period generated $230 million.

If that pace continues throughout the year, the state is on track to lose $150 million that otherwise would have gone into the general fund to pay for various programs.

Still, health-care advocates say the loss of tax revenue is worth it.

"This means there are fewer people smoking fewer cigarettes," said Blair Horner of the New York Public Interest Research Group, which often lobbies against the tobacco industry. "In terms of public policy, this is a good thing."

Statewide, the first cigarette-tax hike came in December 1999, when Gov. George Pataki and the state’s legislative leaders agreed to a three-year, $9 billion health-care deal that — among other things — expanded coverage to uninsured New Yorkers.

The cornerstone of the legislation, known as the Health Care Reform Act, was a 55-cents-per-pack cigarette-tax increase that lawmakers estimated would generate $400 million annually.

Then, when Pataki and the legislature reconvened for the 2002 legislative session in January, they set their sights on smokers once again.

As part of a politically popular $3.5 billion agreement providing multi-year pay raises to hospital workers, lawmakers raised cigarette taxes an additional 39 cents per pack.

That hike, which went into effect April 1, is expected to generate $283 million per year.

But cigarette smokers aren’t the only ones paying more. It’s also costlier for cigar smokers and tobacco chewers to enjoy their vices now that the State Legislature raised the excise tax on those products from 20 percent of the wholesale price to 37 percent. That sin tax took effect July 2 and is expected to raise $14.8 million annually.

It’s not just New York lawmakers taxing "sin" these days, either. Eighteen states across the country this year raised cigarette taxes to pay for programs and balance budgets.

Sciandra’s group estimates that for every 10-percent increase in the price of cigarettes, tobacco consumption decreases 4 percent.

But Calvin doesn’t buy it.

"Anyone who claims there’s been a large-scale quitting on the part of smokers is mistaken," he said.

"These formulas may be valid in a captive population where all these smokers are forced to pay the higher tax. But New York state doesn’t have a captive population. We have a cigarette-tax sieve."

New York smokers just take their business elsewhere, he said.

"We’ve seen a continued decline in the number of cigarette customers visiting our stores," Calvin said. "But it’s not because people have quit smoking. It’s because they are evading the tax."

[qam1]

HST, I hope the next mayoral election has a candidate who promises to rescind all the NYC dumbass smoking taxes and laws.

And that he/she wins, big!

The sad part is that next mayor will be Bill Clinton, And yes he will win big and he will be better than Baffoonberg.

[thinktwice]

He thought competition was "ruinous."

Hugo was a practical man and your thinking that Hugo was against competition is probably wrong because competition is naturally ruinous for losing producers; and conversely, it is wonderful for consumers.

Hugo's Les Miserables (pages 158 and 159), for instance, has Jean Valjean inventing an improved technique to produce imitation jet beads and black glass. That invention led to Jean Valjean making a fortune while "ruining" the competiton.

[Taxman]

If the dumbass NYC folks elect Slick as their Mayor, they will deserve exactly what they get! I have no sympathy, none whatsoever.

Is there an exodus FRom NYC and the state of NY in general? For example, I know that Ann Coulter is moving to Florida because, among other things, she can't smoke there anymore. Any others leaving?

[tbird1]

You sure have that right:

"Another study showed elderly smokers cost the government less than non-smokers because they die younger.

I think booze causes other people more damage than smokers cause non smokers. Driving drunks kill other people."

And those other people are innocent victims.
tbird1

[Buckwheats]

I'll tell you an interesting cigarette story about mindless idiots. When I last traveled (by car) to visit friends in Canada several years ago (pre 9/11), I threw three cartons of cigarettes in the trunk. At the border crossing (in Maine) I was subjected to the most retarded (and longest) search imaginable (way over an hour...they went through every conceivable thing...yet, never found what I always carry...lol). I stood out in no particular way, unless my southern state license plate counts.

After all was said and done, these complete morons informed me that it was only legal to bring in two cartons of cigarettes, and I could pick the third carton up on my way home. I said, "I'm not coming home this way". A female idiot said, "Well, you can pay the tax on the third carton and, then you can take it with you". I said, "OK, what's the tax?" She said, "$20. I said, "That's ridiculous, I only paid $20 for the carton in the first place".

To make a long story short; I flipped a twenty at these low-life imbeciles and took off with my third carton. I may never return to Canada.

P.S. You're a criminal if you steal something from my house and, you're a criminal if you accept a job stealing under thieving goverment protection.

[lockjaw02]

The sad part is that next mayor will be Bill Clinton, And yes he will win big and he will be better than Baffoonberg.

Hey, great! Maybe the seedy sex show economy of old Times Square will return to rival the heights of its past glory!!!

NYC sure has becoming a boring run-o-the-mill puritan-esque town.

[Martin Tell]

I don't have my copy of LM in front of me, but review the section after Jean is arrested and leaves the village. Hugo has a vivid image of competitors moving in, forcing prices in the jet blacking business down and ruining the market. When I re-read LM (about two years ago) I was struck by how much Hugo's economic ideas conformed to the European idea of "fair competition." This is not our market-driven, consumer welfare model of competition (at the time I was practicing EU competition (antitrust) law). The Europeans have had a hard time adopting to the EU's antitrust law. That is one reason the EU is hated on the left; it is felt that market forces, mandated by some EU law, will destroy fair competition and lead to ruinous, cut-throat competition (believe it or not, Euros call those who believe in market forces, "liberals").

Hugo was a great democrat, but his economic ideas were primitive and paternalistic. I love his books, however, but probably not as much as you!

Best regards,

Martin Tell

[lockjaw02]

Is there an exodus FRom NYC and the state of NY in general? For example, I know that Ann Coulter is moving to Florida because, among other things, she can't smoke there anymore. Any others leaving?

Well, they lost two seats in the House of Representatives due to Congressional reapportionment after the last census with only small population gains against much higher growth in Arizona, Texas, Florida and Georgia. Then the state followed up to lose a net 170,828 residents in moves between states in the period of July 01-Jul 02, according to Census Bureau data. That put New York last among all states in migration from one state to another, both in raw numbers and as a percentage of population.

At the rate they're going, they'll have less representation in the House than Wyoming after the 2020 census! ;)