New York – Governor David Paterson’s administration has “written off” taxes that it had expected to collect on cigarette sales by American Indian retailers within New York State, the Buffalo News reports.
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In April, the governor agreed to a fiscal year budget that projected revenue of $65 million from taxing cigarettes sold to non-Indians in smoke shops, through the mail, or from Internet sales from reservation-based businesses.
But without public notice, the administration has eliminated the $65 million line item and won’t begin collecting the tax at least until April 1, 2010, the beginning of the new fiscal year. The decision prompted criticism from non-Indian retailers who say that they cannot compete with the Indian sales, who do not charge the state’s $2.75 per pack excise tax.
“It’s embarrassing, and it’s outrageous that the Empire State can’t seem to figure out how to collect this tax when just about every other state does,” said Russell Sciandra, director of the Center for a Tobacco Free New York.
State officials have feared potential clashes between state troopers and Indians over Indian reservation sales. Indeed, violence erupted in 1995 when then-Governor Pataki attempted to end tax-free sales.
Governor Paterson’s budget director, Robert Megna, said that the state deleted the $65 million line item from the budget “to prudently address potential risks to our receipts forecast. We continue to work diligently toward a negotiated settlement of this issue.”
Despite state laws that permit the state to collect the tax, the Seneca Nation maintains that treaty rights dating to the 18th century give them the right to sell products, including cigarettes, without taxes.
Enough cartons of cigarettes pass through the reservations for every Indian man woman and child to smoke 25 cartons a day. Ebvidently some of these tax free cigarettes find their way off the reservation.
Enough with all the taxes…. do you people realize that in NYC you pay nearly 600% in TAXES on cigarettes. It is a disgusting abuse of the law. Stop buying tobacco products in the US altogether. I did! You can order duty-free online for less than $20/carton from overseas. Every time a new package arrives at my door I feel like I’m having my own private tea party. The government can take their 300-600% tax on cigarettes and stick it.
Once you allow the government to grow itself that way, what will they do when people stop buying cigs in the US? They will have to pass that tax onto everyone else. I can only hope that they put a 600% tax on whatever it is that you ridiculous, welfare-loving, food-stamp living, NYC liberals enjoy most in life.
When you raise taxes to unrealistic levels they will be evaded