N.Y. sues Wash. state company for selling untaxed smokes
NEW YORK (AP) — The state attorney general's office is suing a Washington-based tobacco manufacturer, accusing it of illegally selling hundreds of thousands of cigarettes in New York each year without paying the required state excise taxes.
The lawsuit against King Mountain Tobacco Company and its president, Delbert Wheeler, was filed Friday in U.S. District Court for the Eastern District of New York.
Attorney General Eric Schneiderman said in a statement the company sells and distributes its cigarettes in New York without shipping them to a state licensed stamping agent as required by New York tax laws. King Mountain is Indian-owned and is located on the Yakama reservation in Washington.
"These illegal sales deprive the state of hundreds of thousands of dollars of much needed tax revenue and put law-abiding businesses at a competitive disadvantage, Schneiderman said.
He said licensed stamping agents are the only entities in the state authorized by the New York Department of Taxation and Finance to affix a tax stamp and collect the excise tax due. On-reservation cigarette sales to tribal members can be made tax-free, he said, but those cigarettes must have the tax stamp affixed by a licensed agent.
On Nov. 6, investigators from the attorney general's office purchased unstamped King Mountain cigarettes from a smoke shop on the Poospatuck Reservation in Mastic on Long Island, the lawsuit said.
In another incident, state police stopped a truck on Dec. 3 in Clinton County carrying 84,000 packs of unstamped King Mountain cigarettes, a potential tax loss to the state of more than $365,000, prosecutors said.
Wheeler and his company face up to $25,000 in fines, and he could also face up to five years in prison, Schneiderman said.
Messages left Saturday seeking comment from Wheeler and King Mountain were not immediately returned.
The lawsuit against King Mountain Tobacco Company and its president, Delbert Wheeler, was filed Friday in U.S. District Court for the Eastern District of New York.
Attorney General Eric Schneiderman said in a statement the company sells and distributes its cigarettes in New York without shipping them to a state licensed stamping agent as required by New York tax laws. King Mountain is Indian-owned and is located on the Yakama reservation in Washington.
"These illegal sales deprive the state of hundreds of thousands of dollars of much needed tax revenue and put law-abiding businesses at a competitive disadvantage, Schneiderman said.
He said licensed stamping agents are the only entities in the state authorized by the New York Department of Taxation and Finance to affix a tax stamp and collect the excise tax due. On-reservation cigarette sales to tribal members can be made tax-free, he said, but those cigarettes must have the tax stamp affixed by a licensed agent.
On Nov. 6, investigators from the attorney general's office purchased unstamped King Mountain cigarettes from a smoke shop on the Poospatuck Reservation in Mastic on Long Island, the lawsuit said.
In another incident, state police stopped a truck on Dec. 3 in Clinton County carrying 84,000 packs of unstamped King Mountain cigarettes, a potential tax loss to the state of more than $365,000, prosecutors said.
Wheeler and his company face up to $25,000 in fines, and he could also face up to five years in prison, Schneiderman said.
Messages left Saturday seeking comment from Wheeler and King Mountain were not immediately returned.
you all are a bunch of racist losers...all you can take your big heads and shove em up ur azz
Wow the Indians ducking taxes again! Can you believe it?
Doesn't sound like a WA state company to me. I don't think the indian reservations are subject to the WACs and RCWs...for anything.
New York will lose this .
I see tobacco for what it really is. Population control. It comes down to that in the end, like it or not.
Also, some Indians worship it, some business people feel it's a money making machine. They profit from the addiction and hardship of their customers, and the only other upside I see is that some folks would volunteer to end their life early, and pay for the privilege.The world is getting a bit crowded.
I have recently read that nicotine patches, although still probably addictive, might be good for age related memory issues. The drug is not all bad, evidently, it's just the preferred package that does the harm.
We can't even get the tax revenue owed to us from certain reservations here. Good luck New York!Â
Â
And if you think cigarettes are expensive here at 6 to 8 dollars a pack, they are around 10 bucks in NYC.
can't see the state of new york winning this. it is going from one reservation to another. it's not like they are selling at a downtown business location to the public. think this is just another state wasting the taxpayers money trying to collect money that is not theirs in the first place. reservations are federal and the state should have no rights to interfere nor profit from indian commerce.
 @32jim2 I agree. I read "On-reservation cigarette sales to tribal members can be made tax-free, he said, but those cigarettes must have the tax stamp affixed by a licensed agent." But yet right before that he says " "These illegal sales deprive the state of hundreds of thousands of dollars of much needed tax revenue and put law-abiding businesses at a competitive disadvantage."
So, it's depriving the state of money and yet he says it can be made tax free it's just that it needs the tax stamp? So, if it can be tax free(since it's going from one reservation to another) then why the wasted time getting a stamp?
Â
However, I personally don't think the Indians(Native American for the PC folk) should be exempt anymore from any of these breaks they have been getting. All of those that were treated atrociously have been long gone for more than a hundred years. Why are we still supporting their great-great-great grandchildren? Any if anyone wants to say "you are racist," let me say I am part Shoshone(very little but it's there). Hasn't anyone seen what being on the government end of support your entire life leads to? Poverty. They keep you at poverty level but just at a level that you somehow believe they are helping. And this help goes on for years and where are you 10-15-25 years later? Most likely not any better. Those casino's make so much money and yet the Tribal Nations keep their own citizens poor as well.
@32jim2 you're right, reservations should be walled off so they can be thier own nation. Guard towers would shoot those trying to escape. It would be cheaper then what we pay now in taxes to support them.
 @Common Sense  @32jim2 I suppose you want to shoot our senior citizens too cause they are on social security and medicare.Â
Just quit puffing and get it over with
Lol "natives" getting out of paying taxes in another state.
 @Common Sense sales on the reservation go to the citizens of the reservation just like our taxes go to the citizens of our government. they need fire police and water sewer roads just like you and i off the reservation. if you don't like it don't go to a reservation and spend your money there. if you don't like your taxes were you are MOVE. they also have a choice to live on the reservation or move away and pay taxes like the rest of us.
@32jim2 they don't pay taxes on or off the res and my taxes support them because they are "victims"
@32jim2 @Common Sense .....They oughta put up a border around the "rez" and make them pay to use our roads and services. The border would also serve to protect us from their illegal, explosive fireworks and drivers w/ no insurance.Â
It never ceases to amaze me. The government is doing everything it can up to the point of making cigarettes illegal and yet they have this due me attitude when it comes to the revenue it brings in to their coffers. That must suck to want smokers gone, but not the revenue they generate.
 @Jatok They have no intentions of making cigarettes illegal. On the contrary. They know people will beg, borrow or steal to have them, hence they can make them cost anything they want. Kinda like crack or heroine.Â
@snow surfer The biggest single factor with cigarettes is the amount of taxes, 100s of millions of dollars worth that they generate. The government uses the excuse that it's all about health issues, but the truth of the matter is it all about the money.
 @snow surfer  @Jatok Or tomatoes:   https://www.youtube.com/watch?v=msr5Nj95SKk
 @Jatok The taxes generated by tobacco sales probably barely cover the healthcare expenses used to treat smoking related diseases
 @Larry*X*K  @Jatok On the other hand, dying ten years earlier on average keeps Social Security and Medicare solvent, no? It's really best if folks kick off at 65 after paying into SS and Medicare, then get zip.I mean, from a financial point of view. It's not like people who live longer are actually going to use LESS health services.
Â
In short, give every graduating High School-er a carton of Lucky's!
Â
@Getov Mylon @Larry*X*K Your post is sic. I can see that you have no regard for seniors. Wait until your time comes, and it will believe it.
@Larry*X*K There are many non smokers who abuse the medical system and we all pay for that too. Have you ever been to one of the (emergency rooms) medicade walk in clinics?
 @Larry*X*K  @Jatok I'm not sure about now, but in the 90's I was watching CSPAN and one senator was going on and on about smokers costing the health care system 13 million dollars. He quickly quieted down when another senator pointed out that the federal government had collected 13 billion dollars in tax revenue from cigarettes during that time. So in the 90's, the government made out great with the revenue end. With how the government works I suspect it is much the same now as it was then, and that they get more in revenue than they expend on health care costs.
They don't have to pay state taxes so why should they? Wish the indians would could put up with these nonsense states like ours that are illegally taxing the indian reservations.
This comment has been deleted
 @virtual anomaly  @Blindman Go to trial. It only takes one person to hang a jury and there's a lot of us that get tired of this nonsense. The states have no constitutional authority to make indains pay state taxes. They are not residents of the state, they are sovereign states who have to abide by federal law not state law.
This is pure greed on the part of our govenment through the taxation of one product. It is a form of stealing.Â
How much do our soldiers pay for cigs?
 @bobalouie we pay the same now. they did away with the discount for us.
 @beetle73  @bobalouie "Soldiers about to go into battle! Smoking is bad for your health!"
On the buyer side, I don't see this as being any different than WA people going to OR to buy booze to avoid the taxes.Â
 @Darn it!  hey they go to oregon for booze AND smokes if they live on the border. it should be a right to spend your money where you want and not worry about being arrested by the state for tax evasion. what i find unfair is they want all washington citizens to pay for out of state purchases but give oregon shoppers a tax exemption for buying in washington which does nothing for  either state.
"In another incident, state police stopped a truck on Dec. 3 in Clinton County carrying 84,000 packs of unstamped King Mountain cigarettes, a potential tax loss to the state of more than $365,000, prosecutors said." That adds up to $4.35 per pack in taxes. Un-freaking-believable.
 @Tattooed_AngelÂ
This is what the voters in that state begged for, now they get to enjoy it.
@Alex Clayton @Tattooed_Angel Guess the war on cigarettes also has it's down side. Have to make up all those taxes somewhere.
 @Jatok  @Darn  @Tattooed_Angel WA is desperately seeking new taxes. Tolls, parking meters, whatever they an conceive of a way of taxing. They haven't learned the lesson yet. When the raise the cost of something, people find a way around it and the state ends up getting even less than it had before. Examples: downtown parking, road tolls, cigarettes, admission to state parks, etc.
WA - We are taxed out! Our pockets are empty. Work some more on cutting waste and abuse. Take one for the gipper.Â
@Darn it! @Tattooed_Angel Of course the voters said no and we can't have that. With all the taxes we already have on property, utilities, sales tax, gasoline, vehicles and the list goes on and on I guess they can't leave anything untouched if there's potential.
 @Jatok  @Tattooed_Angel Yep. I heard they were going to try again to add more tax to soda and candy. Can't recall if bottled water is included this time.
 @Tattooed_Angel I can remember when a pack of cigs cost less than a buck. I know, older than dirt. :)
@Darn it! @Tattooed_Angel $.30 when I started college and I remember griping when they went to $.35 in the machines. I finally quit Feb 26th 1999 when they were $3.50
 @Alikelystorey  @Darn  @Tattooed_Angel Kudos to you. Quiting isn't easy. Think of all the money you have saved over these years and pat yourself on the back.Â
@Darn it! When I was stationed in Great Falls Montana a pack of smokes cost around $2 and that wasn't THAT long ago. I remember the first time I came back here to visit family and paid $6 for a pack. I about had a heart attack! :)
 @Tattooed_Angel  @Darn in the 70s they were .35 per pack!!!
Don't worry - the tribes will soon be selling untaxed pot to NY!!!!!!