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Politicians debate relationship of cigarette taxes

Politicians debate relationship of cigarette taxes

The racially tinged death of Garner puts a fresh spotlight on the little publicized underworld of cigarette smuggling and the argument over whether high cigarette taxes deter smoking or simply encourage the illicit trade.New York and Connecticut, two of the highest tobacco tax jurisdictions in the nation, are particular targets for smugglers who bring in cheap smokes from low tax Southern states and Indian reservations such as the St. Regis Mohawk on New York’s far northern border with Canada.Protesters took to the streets nationwide late Wednesday after a grand jury declined to indict the white NYPD officer who applied a choke hold that led to the death of Garner, an African American. Meanwhile, on MSNBC, Sen. Rand Paul, R Ky., blamed Garner’s death on high taxes that make New York and New York City the most expensive jurisdictions in the nation for legal cigarette purchases.”Obviously, the individual circumstances are important, but I think it’s also important to know that some politician put a tax of $5.85 on a pack of cigarettes, so they’ve driven cigarettes underground by making them so expensive,” Paul said.Paul was echoing a long standing conservative complaint that high taxes fuel the underground shipment of cigarettes and the answer is reduce or eliminate the taxes. Conservative radio commentator on Thursday said “black market guys” are “trying to take advantage” of the price disparity between legal cigarettes that can run to $12 or $13 a pack and the cheaper smuggled “loosies” sold on the street.New York state puts a tax of $4.35 on a pack of cigarettes, the highest state tax in the nation. New York City adds a tax of $1.50 to cigarettes sold in the five boroughs, bringing the total tax there to $5.85. Connecticut ranks No. 4 in the nation, with taxes pegged at $3.40 a pack.Anti smoking advocates and lawmakers counter that high taxes are a proven smoking deterrent. They point to studies, including one by the in 2012, that show high taxes lead smokers to quit and prevent young would be smokers from starting.”Increasing the tobacco tax is one of the most effective ways to reduce tobacco use, especially among kids,” said, spokesman for the Campaign for. “Study after study has shown this to be the case, and tobacco companies even admit it in their own internal documents.”Sen., D Conn., last year introduced legislation that among other things would nearly double the current federal cigarette tax, from $1.01 to $1.95 per pack. The hike, he said in an interview, would help eliminate the disparity between cigarettes sold in New York and Connecticut and those sold, for instance, in Virginia where state taxes are 30 cents per pack.”The idea that the tax is somehow responsible for the horrific and tragic death of Mr. Garner seems somewhat off the wall and certainly off the mark factually,” Blumenthal said.The trafficking of cigarettes robs state treasuries of about $5 billion in tax revenues, a Justice Department inspector general’s report stated in 2009. Five years later, the number may actually be closer to $10 billion, said, who retired earlier this year as an assistant director of the, Tobacco, Firearms and Explosives.ATF is the federal agency charged with enforcing statutes prohibiting interstate trafficking of tobacco products. But the bureau, a part of the, has taken the position that cigarette smuggling investigations are low priority unless they are linked to violent crime or terrorism.Marianos, who now advises on smuggling issues, said federal law enforcement has fallen down on the job in combating cigarette smugglers.”To dedicate a minuscule percentage of ATF resources to tackle revenue losses of over $5 billion a year is simplistic and ridiculous,” he said. “The Department of Justice has no strategic plan to deal with the long term effects surrounding the sale of black market contraband tobacco. This is a serious criminal problem that becomes greater and greater every day.”.
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