red states rule
11-30-2010, 04:52 AM
Another example of fialed tax and spend policies
When you INCREASE taxes, you generate LESS revenue to the government
It is basic economics - if you wish to tax any product or service - the governemnt needs to encourage that activity and not discourage it by making it cost more
The underground tobacco market in New York has spread in the wake of tax hikes that make the state's cigarettes the most expensive in the US -- and costs it tens of millions a month in lost tax revenue, the New York Post reported Friday.
Illegal cigarettes were pouring into neighborhood bodegas by the truckload from neighboring Indian reservations, lower-tax states in the South and even as far away as China, authorities said.
Government data showed that New York state was being smoked out of as much as $20 million a month by illegal cigarette purchases -- an estimated 7.3 million packs a month sold off the state tax radar.
"It's an unfortunate side effect of the taxes, creating this black market," said Ron Turk, special agent in charge of the Bureau of Alcohol, Tobacco and Firearms' New York field office.
Sales of taxed cigarettes plummeted 27 percent since July, when state lawmakers raised the excise tax to $4.35 a pack on top of the city's tax of $1.50, making the average price of Marlboros in New York $11.60, with some shops charging as much as $14.
About 30 million packs are being sold legally each month -- down from 41 million packs a month before July.
http://www.foxbusiness.com/markets/2010/11/26/black-market-cigarettes-cost-new-york-m-month/
When you INCREASE taxes, you generate LESS revenue to the government
It is basic economics - if you wish to tax any product or service - the governemnt needs to encourage that activity and not discourage it by making it cost more
The underground tobacco market in New York has spread in the wake of tax hikes that make the state's cigarettes the most expensive in the US -- and costs it tens of millions a month in lost tax revenue, the New York Post reported Friday.
Illegal cigarettes were pouring into neighborhood bodegas by the truckload from neighboring Indian reservations, lower-tax states in the South and even as far away as China, authorities said.
Government data showed that New York state was being smoked out of as much as $20 million a month by illegal cigarette purchases -- an estimated 7.3 million packs a month sold off the state tax radar.
"It's an unfortunate side effect of the taxes, creating this black market," said Ron Turk, special agent in charge of the Bureau of Alcohol, Tobacco and Firearms' New York field office.
Sales of taxed cigarettes plummeted 27 percent since July, when state lawmakers raised the excise tax to $4.35 a pack on top of the city's tax of $1.50, making the average price of Marlboros in New York $11.60, with some shops charging as much as $14.
About 30 million packs are being sold legally each month -- down from 41 million packs a month before July.
http://www.foxbusiness.com/markets/2010/11/26/black-market-cigarettes-cost-new-york-m-month/