Smoking Conspiracy > Money > Black Market Cigarettes

Smoking Aloud

The current anti-smoking campaign
is not about your health ...

It is all about YOUR MONEY... They want it!

Black Market Cigarettes

The big cigarette tax increases many states are imposing combined with federal taxes to fund the SCHIP program will only make black-market smokes more profitable and lead to more cigarette smuggling. People stock up in low-tax states like Virginia and Missouri, truck the cigarettes north and illegally resell them in high-tax states like Michigan and New Jersey. Others buy cartons of tax-free smokes on Indian reservations and sell them elsewhere.

Those pushing to steal more of your money told us that higher prices for cigarettes would not create a black market. They tried pointing to the higher prices in Europe has not created a black market there. Well, all I can say is they just simply don't know what they're talking about. When I was in Germany years ago, for example, I found a HUGE black market for both cigarettes and alcohol. In England, one-half of all cigarettes are sold on the black market. The black market is so common throughout Europe, American legislators are simply closing their eyes to the obvious, and lying to the American public about it.

In 1996 the European parliament warned that organised crime is now involved in large scale cigarette smuggling. "The FENEX Dutch distributors association estimate that the EU is losing $US775m in excise taxes from the illicit trade," said a Cape Business News report. "Typically the cigarettes enter ports like Rotterdam destined for countries outside the EU and therefore not subject to duties. Once landed the cigarettes false documentation allows the cigarettes to be distributed within the EU. Some estimates suggest that up to 20% of EU consumed cigarettes are contraband.

There is already a lucrative black market for cigarettes in the United States and after Congress adds its $1.10 plus tax, the states add their excise taxes, and the tobacco companies add their share to recover its legal costs, etc., you can expect the price of a pack of cigarettes to be somewhere around $5 per pack/ $50 per carton. And you don't think there will be a huge black market?

Since the first state cigarette taxes were imposed in the 1920s, black markets and related criminal activity have plagued high-tax jurisdictions. Sen. Dianne Feinstein (D-CA) admitted there is ALREADY a huge black market for cigarettes in California. It is estimated that nearly 20 percent of the cigarettes sold there are sold on the black market.

New York state is raising its tax $1.25 to $2.75 a pack, the highest in the nation. New York City charges an additional $1.50, which will bring the cost of a typical pack of cigarettes here to $9. Consumers are responding by turning to the city's bustling black market and other low-tax sources of cigarettes. During the four months following the previous tax hikes, sales of taxed cigarettes in the city fell by more than 50 percent compared to the same period the prior year. Over the decades, a series of studies by federal, state, and city officials has found that high taxes have created a thriving illegal market for cigarettes in the city. That market has diverted billions of dollars from legitimate businesses and governments to criminals.

Smugglers have also turned to counterfeiting cigarette tax stamps to disguise packs on the black market. New York state officials announced recently that they had seized $6.1 million worth of fake stamps from a Jordanian tobacco distributor.

In 1994, as part of a property tax reform package known as Proposal A, Michigan boosted the tax on a pack of cigarettes from 25 to 75 cents per pack, creating a huge gap between the price of cigarettes there and nearby states. Not surpringsly, this spawned a Michigan blackmarket.

When Canada steadily increased taxes on cigarettes in the 1980s, a black market sprang up and, at one point, it was estimated that as many as half of all cigarettes consumed there were smuggled in. "There are large profits to be made by smugglers, distributors and retailers," prime minister Jean Chrétien told the Canadian House of Commons in February, 1994. "In 1993 criminal proceeds from tobacco smuggling were upwards of $1 billion." As the smuggling became lucrative, criminal gangs engaged in bloody turf wars to dominate the market. Eventually, the government was forced to cut taxes to reduce the smuggling and crime its actions had nurtured. [Source: Perspective, "Up In Smoke," Investor's Business Daily, July 11, 1997.]

Surely, these legislators who continue to increase cigarette taxes know this. They can't all be that stupid. You can bet they know there will be a huge black market and they know when that happens the American public will cry out to them again to clean up their streets from all the organized crime they created. They will eagerly pass more laws to attempt fixing what they broke and of course with it will come even higher taxes for everyone. It's a sort of socialist spin on 'job security'.

Politically Incorrect


Money · Control · Jurisdiction · Comments · Take Action · BookStore · Sitemap

Copyright © 1996 - 2009 All rights reserved.