New York created their own monster.
There is a point where you tax things enough where the black market comes into play
If it hadn’t cost them in the loss of taxes, it would have cost them in the policing of it, and is costing them in the policing of it.
Greed is nothing new in Government,in this case I am glad to see the black marketeers. It is time cigarettes were left alone or outlawed. Taxing people into quitting is BS.
” There is a point where you tax things enough where the black market comes into play “
The Ruling Class would do well to remember that, in the years leading up to the First American Revolution, Smuggling became an honorable profession...
IIRC, more than a few of our revered Founding Fathers dabbled in the smuggling trade.....
So the headline really should read:
New Yorker Smokers SAVE $20 Million per Month
Indeed, huzzah for the black marketeers. Never would get any good marijuana if it wasn’t for them.
NY State raise its cigarettes so high, that it creates a prohibition-like black market, as citizens seek to avoid the irresponsible tax rates. Crime and violence are the inevitable result of government irresponsibility, as gangs form to organize the trade in cigarettes. What will it take for NY State to act responsibily and lower its cigarette tax rates?
Politicians are economic illiterates and think in terms of a zero sum game where there are no alternatives. Ah, but there ARE alternatives because no political solution exists in a vacuum. The thing politicians refuse to understand is that increasing taxes beyond a certain tipping point guarantees LESS tax revenue to the government. The political solution is to raise taxes even higher to make up shortfall. This results in even LESS revenue than before. It is axiomatic that politicians do not learn from the real world results of their actions.
Nor can they get a grip on other alternatives. Since there are fewer and fewer places where people can smoke, coupled with higher and higher taxes — people QUIT! No smoking = no tax revenue. Or, people can buy the materials: raw tobacco, cigarette papers, filters, and a rolling machine and do it themselves — and pay no tax. Or, they can go to their friendly neighborhood cigarette and tobacco product bootlegger and buy black market with out paying taxes.
About 25 years ago Canada embraced a huge tax on cigarettes — something like $5 per pack — for the usual B.S. reasons. In Canada. the provinces have a monopoly on alcohol, beer, and cigarette sales through state-run stores — no private sales are allowed.
The result was similar to the American Prohibition experience; a huge explosion of bootleg sales. There was even a cottage industry forging tax stamps for individual packs! Eventually the politicians figured out they LOST money on each sale of smokes at there state-run ABC stores and rescinded the tax. Think NY politicians are as smart as Canadians? Nope.