New discount cigarettes

ludicrously low cigarette tax is not only hurting Kentuckians by keeping it alluringly cheap to smoke and depriving the state of badly needed revenue.
It is also hurting other, more discount cigarettes online responsible states by turning Kentucky into a haven for Internet cigarette sales. As taxes and prices have gone up almost everywhere else, Internet operations have grown here as ways for buyers to avoid higher taxes in their home discount cigarettes online states and, worse, for youths to avoid their states' laws against sales to minors.

For now, of course, Kentucky is getting a little extra income from these Internet sales, since the suppliers do pay the state's measly tax of 3 cents per pack.
But that return is coming at a high cost. For one thing, it places Kentucky on the wrong side of the national debate over Internet taxation. States generally agree that Internet transactions shouldn't escape normal state taxes, since that puts local, non-Internet businesses at an discount cigarettes online unfair disadvantage and since it also allows Internet customers to avoid paying for the government services they enjoy. For another, the rise of Internet cigarette sellers means Kentucky is now home to businesses that are legally suspect; they seem to be ignoring the minimal age-verification and reporting requirements discount cigarettes online already on the books. It's not illegal to buy or sell cigarettes over the Internet, but sellers and buyers appear to be obliged to report their purchases and to pay any state taxes owed under the 1949 Jenkins Act. It expressly requires dealers to report out-of-state sales to the buyers' state tobacco tax administrators.
But that is not happening, according to Mark Smith, a spokesman for Brown & Williamson Tobacco Co. "I've yet to see one Internet company out there that is collecting taxes and verifying age," he said. Moreover, added Matt Myers, president of the Campaign for Tobacco-Free Kids, "Internet sales discount cigarettes online to kids is an emerging and growing problem."

Both the federal government and the state attorney general must crack down on such suspect practices. But the best solution would be to eliminate the reason for them.
Kentucky should join the vast majority of other states, whose average cigarette tax is now 58.8 cents per pack, and raise its rate to a level that is both socially responsible and fiscally productive. The Internet discount cigarettes online by nature provides bountiful and unprecedented opportunities to sidestep the law, while the limitations of law enforcement let the ethically challenged exploit these opportunities without losing sleep over getting caught.

Another outstanding example can be found in a report about cigarette sales over the Internet that was recently prepared by the U.S. General Accounting Office. The 55-page analysis examines how the 50 states are doing collecting excise taxes that are payable on cigarettes sold by the 147 online tobacco merchants the GAO could identify.How are the states doing? Let's put it this way: Next time someone lights a cigarette near you, try discount cigarettes online grabbing a handful of the smoke. . . . That's how they're doing.
The report doesn't get at a precise dollar figure for the lost tax revenue but does cite a year-old Forrester Research estimate that U.S. online tobacco sales will reach $5 billion by 2005 and that the states will lose out on $1.4 billion as a result.
Here is what's happening . . . or, discount cigarettes online more precisely, not happening. "Consumers who use the Internet to buy cigarettes from vendors in other states are liable for their own state's cigarette excise tax and, in some cases, sales and/or use taxes," the GAO report explains. "States can learn of such purchases and the taxes due when vendors comply with the Jenkins Act."Ah, the Jenkins Act. There lies the rub between old law and new technology, as the lawmakers who passed the act - in 1949 - obviously knew not of the Internet. Nonetheless, the discount cigarettes online act requires vendors - including online merchants - who ship cigarettes into another state to anyone other than a licensed distributor to report the details of all such transactions to the tax discount cigarettes online authorities in those states.

In theory, the recipients of the cigarettes are supposed to pay the taxes or the states will come calling to collect.In practice, precious few smokers pay up, and the governments are in poor position to collect because only a handful of merchants fulfill their responsibilities under the Jenkins Act. Just how pervasive is the disdain for this law? Some of these online outfits carry revealing names such as Notaxsmokes.com and Dutyfreetaxfree.com, while others proudly proclaim on their home pages that they do not and will not comply with the Jenkins Act. Their excuses - including claims of exemption by American Indians - discount cigarettes online are all bogus, according to the GAO.Which brings us to the question of what should be done about it.(All of you who believe it's OK to avoid paying taxes of this kind because you judge them to be unfair can go get in line with the corporate bigwigs and bean counters who believe the rules are meant for others.)
The GAO report says that a violation of the Jenkins Act is only a misdemeanor that carries a maximum $1,000 fine and six months in the can. Near as the GAO can tell, no one has been fined discount cigarettes online or jailed.State officials highly recommend making Jenkins violations a felony.A good start, but that isn't likely to compel individual smokers to get square with the discount cigarettes online tax collector, or even discount cigarettes online deter the merchant violators without an accompanying aggressive enforcement campaign.