The Onondaga Nation may stop selling national brand cigarettes to avoid paying a new state tax.
Governor David Paterson figures the state can collect up to $200 million by taxing tribal cigarette sales. The plan would force distributors to pay the tax before the smokes are delivered to Indian stores like the Onondaga Smoke Shop on Route 11. The tax amounts to $4.35 per pack. The state anticipates the tribes would then pass their extra cost onto consumers who were lined up today to stock up before such a tax could take effect.
Onondaga Nation attorney Joe Heath says "This is just the latest in 25 years of attempts to collect the same tax."
Heath says the Onondagas have another option to avoid paying the tax by stopping the sale of national brands and selling only Indian-made brands like the Seneca brand. The Oneida Nation is also considering such a move. The tribes claim if they're made by Native Americans and sold on Native American land, then New York has no authority to tax them.
Heath explains, "The enforcement mechanism for this entire taxing scheme is at the distributor. We can get native product directly from other nations or from manufacturers and it's our view that the trade is not subject to state regulation."
Mike Glynn owns Rocky's News and Cigar in Syracuse. Glynn supports Governor Paterson's efforts. "I don't think you can deny the indians their rights. It is a sovereign nation, but the laws are on the books. We simply want those laws to be enforced equally and even-handed."
Glynn says in the past 20 years, sales of cigarettes at Rocky's has dropped by 20 percent, mainly because the Onondagas can undercut his prices by not charging taxes.
