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New York City Snuffs Out Untaxed Cigarettes

  • Oct 3, 2012 | Gail Cole

New York has a cigarette tax, and some people don't like it. Or at least, some people hope to profit from it. 

The New York State and City Cigarette Tax "must be paid on the possession of all cigarettes, whether bought for resale or consumption." Combined City and State cigarette taxes are $6.46 per pack:

  • $4.35 is New York State tax;
  • $1.50 is New York City tax;
  • $0.61 is Prepaid Sales tax.

These are the highest cigarette taxes in the country. According to the New York Times, they are "part of an emergency budget measure to keep the government running." The taxes provide millions of dollars in revenue for health care related programs.

Some health advocates hope the taxes persuade smokers to quit. Critics of the cigarette taxes have said they may "drive more customers to the black market." (NY Times.)

In September of this year, a Queens man was charged with trafficking in untaxed cigarettes. The District Attorney of Queens County announced: "More Than 20,000 Counterfeit State/City Tax Stamps and Nearly 230,000 Untaxed Cigarettes Among Items Allegedly Seized." In the state of New York, "only a licensed stamping agent can possess untaxed cigarettes and affix the tax stamp on the packages."

According to Queens District Attorney Richard A. Brown, "Tobacco bootleggers who illegally bring thousands of untaxed packs of cigarettes from other locations to New York for resale cheat the public by failing to contribute their fair share of the dollars." It is alleged that the man charged, Manuel R. Espinal-Ramirez, "was seeking to shortchange New York State and New York City out of nearly $200,000 in tax revenue."

Tobacco bootleggers in New York are not going unchallenged. "The Sheriff's Tobacco Enforcement Unit is out on the streets, snuffing out illegal cigarette activity wherever we find it," Finance Commissioner Frankel said.

The arrest hinged on cooperation between the Department of Finance, the District Attorney, and the Tax Department. If convicted, Espinal-Ramirez could spend up to 15 years in prison.

It's enough to make a person quit smoking.

Read more about New York cigarette tax and tax evasion here.

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.