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Posted on 01/15/2013 7:42:09 AM PST by MichCapCon
Supporters of punitively high tobacco tax rates should be careful what they wish for.
According to the Mackinac Center’s latest estimate of cigarette smuggling rates, Michigan is No. 10 nationally in the proportion of cigarettes being smoked here that are illegally smuggled in. This is the third such estimate the Center has produced, and the details are disconcerting. The smuggling rate here increased 12 percent since 2009, with contraband smokes now representing 29.3 percent of all consumption.
The increasing rate of both casual and commercial cigarette smuggling over the past two decades is staggering. Casual smuggling occurs when individuals shop in lower tax jurisdictions for personal consumption. For example, a Kalamazoo smoker can easily make a run for the Indiana border to stock up on much lower-priced smokes. In 2011, such activity represented slightly more than 15 percent of the cigarettes smoked here. Commercial smuggling involves large-scale, long-distance shipments from states like North Carolina or Virginia; it supplied more than 16.2 percent of the cigarettes smoked here in 2011.
At the same time, Michigan also is an out-bound smuggling source. We estimate a quantity equivalent to 3.6 percent of state consumption was smuggled out to Canada, among other things lowering this state’s net-smuggling rate.
Cigarette smuggling is responsible for much more than just state government revenue losses. It is associated with violence, theft, counterfeited and adulterated products and government corruption to name a few.
One example of these unintended consequences involves a police officer in Maryland who actually used his official patrol car, uniform and pistol to escort illicit cigarette shipments to their destination. When smuggling profits are sky high, everyone seems to want a piece of the action and even the “watchers” need to be watched.
The top 10 smuggling import states are, New York (60.9 percent); Arizona (54.4 percent); New Mexico (53 percent); Washington State (48.5 percent); Rhode Island (39.8 percent); Wisconsin (36.4); California (36.1); Texas (33.8); Utah (31.2); and Michigan (29.4).
New York should not be a surprise. It has the highest tobacco excise tax in the nation at $4.35 per pack and New York City imposes another $1.50 on top of that. Cigarettes are undoubtedly being run in from Virginia, among other states. Virginia has the second-lowest tax rate in the nation at .30 cents per pack.
New Hampshire’s proximity to higher-tax states also makes it a significant smuggling source, with outbound smokes equivalent to 27 percent of the state market.
The conclusion from rapidly rising smuggling rates is that politicians’ addiction to higher cigarette tax revenue has created an illegal trade that is hyper-profitable for the wrong people and is generating significant negative consequences for our society.
Fictional story. Liberals assure us that bans and taxes will automatically ensure 100% compliance and that if we melt all guns down violent crime will cease, just as taxes have stopped smoking.
smoking is healthier than fascism.
/johnny
Yes, your chances of a sudden lead overdose are much less.
Just about all northbound traffic stops there for two reasons:
Its comical in a way. Everybody knows that those buying caseloads aren't taking them back to friends up north. But even the NC and SC state troopers who use the border truck stop as a regular turnaround (and provide an added degree of safety for all the cash which flows through it) can't help but laugh at the stupidity of liberals who think there is little or no change in commerce no matter how high taxes are raised.
If I live in Beloit, Wisconsin, and six miles away in Rockton, Illinois there is a strip mall with cigarettes priced $2 less per pack, and I go there and buy a couple of cartons and bring them back to Beloit for personal use, “smuggler” is not the first word that comes to mind.
Just across the border in Mexico, cigarettes are still about $2 a pack.
That’s my next profession ,, smuggler! ... and maybe moonshiner..
Thrifty come to mind, maybe even smart shopper, but smuggler, no that one doesn't come to mind.
Talk about unintended consequences. (shakes head)
I think I should have a whole pallet of them, if they are for consumption by me or my baby. In my feeble (and non-legal) mind, the term “smuggling” doesn’t come into play unless I sell some. But I know that is not the legal, operational definition.
(Have a nice Christmas, RikaChicka?)
Mexican cigarettes taste like they’re made with pencil shavings.
They are pure pleasure compared to Russian cigarettes, wrapped in newsprint. They taste like steel wool soaked in road asphalt.
Ouch. You have a point. And they sell those black and gold grisly things at specialty tobacco shops as rare imports (For large coin). I smoked one once and almost puked all over the place. Gimmee a Marlboro. Sheeeeeit.
Most any cigarette from outside the United States will make your head spin at best, very strong. Some are disgusting. I spent a fair amount of time in Ireland at one point and found a brand there that was not just tolerable but enjoyable, though. Silk Cut. For all their history and their artsy, intellectual air, I thought Gauloises were all but unsmokable, you'd be better off inhaling a cheap cigar.
A heavy smoking coworker actually kept a cig, well-preserved in an Altoids tin, from a former Russkie satellite state. He’d been there once on a vacation and couldn’t believe they actually paid money for them.
Thing looked like it had been made by a delinquent teenager in his daddy’s garage.
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