NCPA - National Center for Policy Analysis


December 15, 2005

Western New York can boast a new No. 1 status: king of the tax evaders; a study found that 71 percent of area smokers buy their cigarettes all or some of the time from Indian retailers that collect few or no taxes, says the Buffalo News.

The figure dwarfs other regions of the state, notably New York City, where one-quarter of smokers regularly seek out cigarettes with little or no taxes, says the News. The study follows a 2003 survey which found that 51 percent of smokers in Erie County, New York and 78 percent of Niagara County, New York, regularly buy cigarettes from Indian retailers.

In other findings:

  • An equality between the sexes exists when it comes to women and men who regularly buy tax-free cigarettes.
  • The older the smoker, the more likely they are to avoid taxes; nearly 47 percent of those older than 65 buy their cigarettes all or some of the time from tax-free sources, compared to 29 percent of smokers between the ages of 18 and 24.
  • White smokers are more likely than blacks to buy tax-free, as are smokers with college degrees, compared with smokers who never graduated from high school.

Additionally, over the years, Internet cigarette sales have increased -- in 2004, about 3.1 percent of the industry's total volume was sold over the Internet -- but a recent agreement between the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), major credit companies and various states attorneys general prevents the use of credit cards to buy cigarettes over the Internet, says Forbes.

Furthermore, in early 2005, the U.S. Postal Service and representatives of various state attorneys general met to discuss how the Service can avoid legal liability for its role in delivering cigarettes sold illegally on the Internet, says U.S. Newswire.

Source: Editorial, "In New York, Smokers Continue Seeking Tax-Free Cigarettes," Buffalo News, November 2, 2005; Editorial, "Internet Tobacco Sales Burned By ATF Agreement," Forbes, March 21, 2005; and Editorial, "Internet Cigarette Sales Spark Enforcement Meeting, Possible Crackdown; Postal Service Meets With Attorneys General on Thursday," U.S. Newswire, March 16, 2005.

For Buffalo News text:


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