Retailers caught and found guilty of selling untaxed cigarettes in
New York State risk losing other state-issued licenses, including
lottery and alcohol sales.
The New York State Department of Taxation and Finance announced that
it has joined forces with the New York State Gaming Commission and State
Liquor Authority in an initiative to further reduce sales of contraband
cigarettes.
Under the policy, a cigarette-licensed retailer found to be in
possession of untaxed cigarettes will face immediate enforcement action,
ultimately leading to the possible suspension or revocation of licenses
to sell tobacco, alcohol, and lottery tickets. The agencies are
increasing the deterrent to illegal cigarette sales by targeting the
largest revenue drivers for certain retailers.
The Tax Department’s Criminal Investigations Division (CID) has long been charged with inspecting retailers who sell cigarettes to make sure every pack sold in New York State and New York City has the proper tax stamp affixed to it, verifying that the excise taxes have been paid. A vendor could be arrested, fined, and have the license to sell cigarettes suspended for a significant amount of time—and possibly revoked—if they fail to comply.
The Tax Department’s Criminal Investigations Division (CID) has long been charged with inspecting retailers who sell cigarettes to make sure every pack sold in New York State and New York City has the proper tax stamp affixed to it, verifying that the excise taxes have been paid. A vendor could be arrested, fined, and have the license to sell cigarettes suspended for a significant amount of time—and possibly revoked—if they fail to comply.
“That won’t change,” said CID Deputy Commissioner John Harford, “but
now we’re raising the cost of ignoring the law through a cooperative
agreement with two other state agencies that deal with the same
retailers.”
21,000 Retailers
There are approximately 21,000 licensed retailers selling cigarettes
in New York State. An overwhelming number of them also sell lottery
tickets and liquor.
“The licenses issued to retailers are contingent upon the lawful
operation of the business. We want the retailers to understand that the
failure to operate lawfully jeopardizes all issued licenses,” Harford
added. “No business owner wants to face enforcement actions on three
fronts, let alone the maximum penalties those agencies can impose.”
“Enforcement works best when regulatory agencies work together and we
are honored to partner with Tax and Finance and the SLA to put a stop
to the sale of untaxed cigarettes,” said Gaming Commission Acting
Executive Director Ron Ochrym. “The Gaming Commission is committed to
making sure that lottery retailers abide by all state laws and
regulations.”
“The SLA is committed to partnering with Tax and Finance and the
Gaming Commission to eliminate illegal cigarette trafficking,” said SLA
Chairman Vincent Bradley. “Businesses found making these illicit sales
will be held accountable for defrauding New York State taxpayers and
placing retailers who are playing by the rules at a competitive
disadvantage.”
Source: New York State Department of Taxation and Finance
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