"For the county to be that dependent on the cigarette tax is crazy," one person wrote to us in response to our report on the latest round in the dispute over the collection of sales tax on cigarettes sold by Indian nations.
As we reported earlier this week,a coalition of small businessmen and state and county officials is reminding Governor Paterson of the September 1 deadline, to start collecting taxes on cigarettes sold by Native Americans. Assemblyman Bill Magee (D-Madison County) says he believes the increases in both the excise and sales taxes are sending more people to buy at less expensive smoke shops, which adds to the problem---right now it's estimated that one third of all cigarettes sold here in New York are untaxed, losing the state $150-million to $1-billion dollars in revenues.
One comment on our website asks this: "If raising the cost of cigarettes is to discourage the smokers from smoking, how does the government expect to receive millions or more in revenue from the "I cannot afford to smoke" smokers?"
For others the debate over collecting taxes on those cheaper packs sold by Indian nations is less about the lower price and more about the new taxes which went into effect this year making cigarettes sold in New York the highest taxed per pack in the country. Some believe that will force more smokers out of state to buy, and thus, lower the overall sales tax collection. "Even if the Indian reservations collect taxes, personally I'll just drive down to PA and get them. A lot of people will go to other states."
New York actually won a case in the US Supreme Court that allows the taxation, and other states, including Michigan, have used it to set up taxation agreements, but New York has not.
We want to know what you think of the debate. Join in the conversation by leaving a comment below.
