New York will begin a crackdown on Internet cigarette sales June 18, in a bid to bag what Newsday calls hundreds of millions in tax revenue "lost" through Internet sales.
Not that Audrey Silk, founder of the smoker's rights group NYC Clash, is worried, especially. "We're almost optimistic that they can't enforce it," she told Newsday. Online Tobacco Retailers Association president Ali Davoudi agrees, saying the state could stop the truckers delivering the cyber-sold cigarettes but they can't stop the cybersmokes from reaching buyers through the mail.
"The main beneficiary is going to be the U.S. Postal Service," Davoudi told Newsday. "My guess is there's a lot of Websites out there that will choose to utilize that loophole."
New York is grappling with a reported $12 billion deficit. They're just one of a number of states who have been looking for ways to tap e-commerce as one route to closing similar deficits.
"The states really can't prevent us from accepting and delivering items that are legal to mail," said U.S. Postal Service spokesman Gerry Kreienkamp to the newspaper. But the state's department of taxation and finance said the state can focus on the shippers, though the department admitted they couldn't be sure just how many would use the mail to deliver the Internet-bought smokes.
And the stakes in this battle go beyond just closing a state budget gap, Newsday said. New York smokers already pay state and local taxes enough that a carton of Marlboro cigarettes can hit $75 in New York City compared to a $28-32 online price, the OTRA told the newspaper, with overseas companies charging as low as $10 a carton for other brands – basically, what a standard carton of cigarettes cost at the store in 1985.
And cigarette retailers could feel it in the purse even more. "Our people will go into stores and customers will say, `I just need a pack now because my order is coming from the Internet,"' said Fair Application of Cigarette Taxes leader Dan Finkle to Newsday.
