He was buying them in Virginia which has the lowest tobacco tax rates in the US. A $40 carton of Newports in VA goes for more than twice that price in New York.
With the number of cartons he had he must have done a lot of traveling in VA since the law says a person or group may not purchase more than five cartons, and that also means they can't go out the door and just go back in to get five more.
I didn't realize there was so much difference in cigarette taxes between states. After your post, I checked and learned that NY cigarette taxes are $4.35/pack and VA is $0.30 . WOW!! No wonder they call NY the land of taxes.