Friday, March 20, 2015

And the Mafia thanks you for that

Hit and Run: "New York Creates Massive Cigarette Black Market, Wants Virginia to Fix It - Because lowering taxes to reduce the incentive for smuggling is out of the question."

I forget where I saw it but this story confirms that well over 50% of all the cigarettes in New York City are black market.  The news story I saw showed a guy walking the streets of the Big Apple picking up stray cigarette wrappers, which are marked with the state of origin.

"How many packs ya want?"


Anonymous said...

The head of Richmond's Alcohol Tobacco, Firearms and Explosives office says "It's an immense problem here... a huge organized crime problem in this state (Virginia)." Local robberies, carjackings and murder have been occurring. Arab and Chinese gangs have moved into Virginia. Virginia is also seeing an influx of heroin, untraceable firearms, and stolen cars (mobsters don't always pay those low, low Virginia prices in cash). There are concerns that some of the illegal cigarette profits are funding terrorism, a link which has documented before. The blind Sheik who bombed the WTC in 1993 was a former investor in Virginia-to-NY cigarette trafficking.

But it's all the Big Apple's headache.

Smoke 'em if you got 'em said...

As the situation with contraband cigarettes in NYC has continued to deteriorate, the city has increased its taxes on cigarettes 3 times since 2006, while Virginia has maintained its taxes at their low rate.

How can the nation allow Virginia to continue to incrementally make this problem worse and worse?

Anonymous said...

The contraband situation in Virginia is deteriorating, too, while Sheikh Omar Abdel-Rahman's successors say "Don't tread on me."

Why has Virginia put much lower taxes on tobacco than other, equally tax-averse states? One also wonders why Hawaii has maintained pineapple taxes at their low rate.

The obvious solution is a uniform national tax on cigarettes, which would kill the black market dead in an instant. Think Virginia would go for that?

Smoke got in your eyes said...

The obvious solution is a uniform national tax on cigarettes, which would kill the black market dead in an instant.

Only in your fantasies would this snuff out the black market. Why would a national tax stop the states from applying their own taxes on top of it? And guess what - NY's would continue to be $5.85 per pack and Virginia's $0.30. Virginia might even eliminate theirs in solidarity with tobacco producers. Similar or higher profit margin for smugglers, though the overall volume would be slightly lower because the total price is higher.

Next up: NYC will start complaining that Big Gulps and high-fat meals are being smuggled into their city. Why is the rest of the country supposed to adapt themselves to the grotequeries of the Big Apple?