Stiff Tobacco Taxes Inspire Flourishing Black Market in Cigarettes

CAL-TAX DIGEST ^ | June 2001 | James P. Sweeney

[Khepera]

HooRah! Let them eat dirt :)

[NovemberCharlie]

When my godmother was in boarding school in Europe, she and her brother used to make money by selling to their fellow students the cigarettes they'd bought at duty-free shops in airports.

[eggman]

In California, a black and gray market in tobacco products already was costing the state an estimated $50 million when voters approved Proposition 10, an initiative that more than doubled the tobacco tax rates as well as more that doubling the amount of money that can be made in the black and gray Davis market.

The government's usual reaction is to increase enforcement, which eats into the tax revenues and further harrasses the law-abiding citizens who are paying the taxes and the businesses that have to collect them. The only real winners are the crooks and the government employees that the crooks pay off.

[randita]

Of course, the legislature is goofy enough to make smoking completely illegal in California, even in one's own home. I wouldn't put it past them for one a minute.

There's a law in the CA Legislature at this very moment which would raise the smoking age to 21. It's not going to pass because the state needs the tax revenue desperately, but if it had come up a year or two ago, when the state had a huge surplus, I'll bet it would have passed.

[Madame Dufarge]

"They're trying to explain what they see as an unusual drop in consumption data by saying there hasn't been a change in smoking prevalence and there has been a huge change in the amount people are smoking," said Dr. John Pierce, a professor of cancer prevention at the University of California, San Diego.

Smoking Californians should start lobbying immediately to have Professor Ostrich put in charge of all tobacco consumption "studies" in the state. He has to make the assertion that there's been a "huge change" in the amount people are smoking to validate the effectiveness of "cancer prevention" experts."

In the meantime, the taxes keep going higher, more people find a way to avoid them, and eventually the tobacco tax dollars the state gets diminishes to a dribble.

Dr. Pierce said he found no evidence of a significant black market in a massive cigarette consumption study he recently completed for the state. But he said his data was collected in 1999, and did not attempt to measure any counterfeiting, which was discovered in February 2000.

He's probably completely unaware of Internet sales, too. More tax dollars down the black hole known as "academia." How do you do a "study" on tobacco consumption trends without factoring in the black market?

[Madame Dufarge]

The sophisticated frauds,

No, it's the state perpetuating the fraud, when it onerously taxes one segment of the population for engaging in a legal activity in a supposedly "free" country.

designed to dodge the state's relatively steep tariff on cigarettes and other tobacco products, since have turned up in 17 counties and investigators fear more are out there.

"Relatively" steep? Compared to what? A 200% tax?

[Publius6961]

Welcome to the War on (Some) Drugs v2.0.

A critical clarification:

Welcome to the War on (Some) legal Drugs v2.0. v1.0.

[Wolfie]

Tsk, tsk...breaking the law to get their fix. Have these people no shame?

[yoe]

A little History here is important for the coming election.

http://www.cato.org/dailys/8-30-96.html

[GailA]

btt

[WaterDragon]

The lefty Democrats are delighted at the idea of turning Americans into smugglers. The left hates our rule of law, and encouraging Americans to disrespect the law is manna from heaven for them!