Posted on 02/21/2005 6:46:21 AM PST by Zon
Hundreds of Michigan residents are getting a big surprise this tax season--hefty tax bills for cigarettes they bought online over the past four years.
The state sent the bills to 553 residents last week after subpoenaing 13 online tobacco shops for names of Michigan customers and their order histories, a Michigan Treasury Department spokesman Caleb Buhs said on Friday. The tax bills are based on information from just one store, and the state expects to collect more names from the others.
Collectively, the people receiving this first round of bills owe the state $1.4 million, an average of $2,500 per person, Buhs said. They have until March 14 to pay.
"At its most fundamental level, this is an issue of tax fairness," State Treasurer Jay B. Rising said in a statement. "It is only right that out-of-state vendors, who conduct business only online and at arms length, follow the letter of the law. These taxes are collected by brick-and-mortar businesses in Michigan, and Internet vendors should not be allowed to skirt their responsibility."
Michigan, which levies a $2 tax on every pack of cigarettes, collected $993 million in tobacco taxes last year, Buhs said.
eSmokes, one of the top tobacco sellers on the Web, cancelled thousands of orders to Michigan customers after hearing about the tax crackdown, an eSmokes representative said. The representative would not discuss whether the store has been subpoenaed by Michigan or any other state.
Michigan did not disclose which companies it has subpoenaed.
Other states, including California, Washington and Wisconsin, have launched efforts to collect tobacco taxes from residents who dodged them online. A 2002 report (click for .pdf) from the U.S. General Accounting Office said most states tax the sale of cigarettes, and that online sales have cost them millions of dollars in lost revenue.
Internet shops that don't tell states about tobacco purchases by people other than licensed distributors are flouting a federal law known as the Jenkins Act. Laws that exempt online retailers from collecting sales taxes do not apply to tobacco excise taxes, the GAO report said.
I'm speechless.
For a thousand years people were lead to believe the Earth was flat and at the center of the Universe. Time duration is a non argument. Interesting that that is the best you can do.
Yes, legally if the state enacts the law. If I disagree I take my issue to my reps in the legislature. I don't decide the law doesn't apply to me. The difference is either a nation of laws or a nation of men based on anarchy. Apparently, many smokers don't care about orderly government when their precious tobacco is at stake.
This needs to change. Either tax nothing online (preferred) or tax it all. Period.
Always file something. It establishes the statute of limititations.
If you want to live in a nation such as ours respect for the law must come above your nicotine urges.
I can garuntee that you break at least one law a day, if not more than one. Welcome to the club.
If you want to live in a nation such as ours respect for the law must come above your nicotine urges.
You're certainly free -- I think -- to champion the status quo.
I don't smoke. Again you assumed wrong. You're batting zero. Besides, you're latest argument is also a non-argument. Add that to your earlier failures
.Raycpa wrote: We either have laws we follow or we have anarchy.12
Apparently you irrationally think there are no bogus laws.
How is it that people increasingly prospered as did society without last years new laws or new laws created decades ago? How is it that anarchy didn't ensue over the last hundred hears -- save for prohibition? How is it that we don't have anarchy right now without next year's new laws or new laws yet to be created five ten or fifteen years in the future?
In fact, people and society would prosper much more without the massive number of laws the parasitical elites that have encumbered people and business with.
They reap unearned power and usurped paychecks at the cost of individual prosperity and increased prosperity for society in general. They in fact do the opposite of what they proclaim.
The only valid function and purpose of government is to protect individual life and property rights and ensure private contracts are honored. 25
Following the example of 'Great Leader' himself, I intend to donate used underwear to charity at $20 each to offset the cigarette tax I owe. See anything wrong with that?
I would highly recommend you obtain legal advice. Knowningly filling out a tax form with false information can get you into a LOT of hot water. Remember, all it would take would be for the revenue department to get the records from a few top vendors and start matching records.
"Apparently, many smokers don't care about orderly government when their precious tobacco is at stake."
Do you consider a smoker who quits to avoid paying the tax a criminal?
Taxes are not a bogus law. A tax that applies to all residents regardless of where the purchase is fair. So, please demonstrate what is bogus besides the fact this taxes people who cannot control their nicotine urges.
Wrong or illegal ? You do know the difference?
If I buy a carton of smokes in New Hampshire, and smoke them in vermont while I am a CT resident, Am I liable for the Use tax in CT? How could it be proven that I am a tax cheat? Am I liable for Use tax if I purchase frireworks in NH that are not obtainable in CT?
I would be willing to bet something of significance that you yourself are a tax cheat by your own definition.
FYI - Don't write NONE on the form...you could be prosecuted later on if you turn up on a list somewhere. Simply leave it blank.
Taxes are not a bogus law.
Income taxes are bogus. A NRST such as the FairTax is legitimate.
A tax that applies to all residents regardless of where the purchase is fair.
That's how the FairTax works
You're most likely aware that United States and Lebanon are the only two countries that impose tax on income derived from outside their respective countries. You probably never met a tax you didn't like or thought was bogus.
There are a number of factors that need to be present before a criminal act takes place. However do I have a problem with people like these Internet vendors who encourage people to break the laws implying that its legal to do so ? Yes, very much. Do I have a problem with tobacco users encouraging others to break laws while making it sound right and risk less , you bet.
Do I have a problem with people who use the breaking of the law as a political statement knowing full well the consequences and being prepared to take those consequences, No. I admire them but the others who do it for personal gain and who get others to do so are scum.
Where did you use the cigarettes ? That is where the use tax applies. Also, most states have certain minimums.
How could it be proven that I am a tax cheat?
One can be a tax cheat and still get away with it.
Am I liable for Use tax if I purchase frireworks in NH that are not obtainable in CT?
Probably. The use tax applies to all things unless CT provides an exception.
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