Cigarettes in Ashtray Photo Courtesy of the Guardian

Michigan has the Sixth Highest cigarette tax in the country. Neighboring Indiana and Ohio have taxes of up to a dollar less. So, naturally, Wolverine State smokers who live close to the border will drive over to get their smokes and save money. And enterpreneurs will engage in the all-American dream of making a buck, by buying up cigarettes and selling them at a profit. The higher the tax disparities – and some states barely tax cigarettes at all – the greater the profit margin for those willing to take the risk.

If one were to skip over a state to Missouri ($.17 tax) and sell those cigarettes in Michigan ($2 tax,)  they could presumably turn a decent profit (Obviously, we do not support any lawbreaking.)

This is a factor that lawmakers should have considered as they gazed upwards into the clouds and vowed to protect our children while legislating this tax increase.

They also should have considered New York, the state, as of June 3rd, with the highest cigarette tax in the country. Business has jumped in Canal Street, resulting in a rise in the sale of cheaper, possibly less safe knock-off cig’s and an increase in ATF investigations. Nearly half of smokers interviewed for a survey in New York City acknowledged having smoked contraband cigarettes. The figure is likely higher as some smokers are unable to tell the difference between the real and fake Marlboros.

Of course, government can look at these statistics and conclude that prohibitive taxes on cigarettes are an unwise policy. Or, more likely, they can intensify law enforcement and find ways to find and even jail more people.

Michigan, where smokers are only legally allowed to have cigarettes with a stamp acknowledging the payment of the tax, appears to be doing the latter. Those carrying six or more cartons without the stamp can be jailed. Retailers who sell cigarettes illegally can be temporarily put out of business by the state. Undercover agents get involved.

As for the tobacco industry, they oppose the tax increases but support harsher enforcement; after all, if someone’s going to profit, and better them then a smuggler.

But here’s a question: what if you are a smoker who really is passing through Michigan? What if you are from Philly and bought a few cartons – say 6! – in PA and have been smoking on your way through the country? Say you’re pulled over in Lansing for speeding and the officer finds the (unstamped) cartons.

Could the officer then send you to jail?

• Cigarette Smuggling Ring Broken
• Quit Smoking. Or Else.
• Criminal Caught Sneaking Back into Jail!
• South Central – Higher State of Consciousness
• When Democracy Fails

This entry was posted on Monday, December 1st, 2008 at 9:36 pm and is filed under news. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.