RI takes measures to stop sales of smuggled cigarettes
Published on June 8, 2009 4:26 AM
Back in April the Rhode Island governor signed the bill to raise the state cigarette tax to $3.46 per pack, making it the highest tax across the nation. Whereas the decision has a definite health appeal, it also would prompt to collecting up to $170 million in revenue for the budget of cash-strapped Rhode Island.
Therefore, it is now the turn of local law-enforcement authorities to execute the law. And they went at their job boldly, by doing their best to prevent the sales of illegal cigarette in local stores to handle as much revenue as possible to the state treasury and fleece the cluster of local smokers who have to fork up an average of $8.35 per pack of cigarettes.
According to the Rhode Island Tax Administration chairman David M. Sullivan, they have been working shoulder to shoulder with the RI police department, to enforce the regulation properly.
Sullivan admitted that three inspectors from their agency confiscate average 25 cartons every month that lack Rhode Island tax stamps but are selling illicitly in a local convenience store, one of more than a thousand stores licensed to sell cigarettes in Rhode Island.
Tax Administration chairman stated that agents always work undercover and even ask police officers to put on civilian clothes and accompany them in their inspections.
Another RI taxation official, Donald W. Englert, Division of Taxation senior agent said that the biggest problem of the agency was the state tax stamp, as the local excise tax stamp located on each cigarette pack is very similar in color to Virginia tax stamp. Therefore, inspectors admit they have seized a lot of Virginia-stamped cigarettes illegally sold in local cigarette shops.
The major issue with those cigarettes is that Virginia state cigarette tax is 30 cents per pack what helps smugglers earn $3 for every pack of cigarettes bought in Virginia and illegally sold in Rhode Island.
The cigarette smugglers also bring their illegal goods from New Hampshire, which collects $1, 08 per pack and even South Carolina, where the excise cigarettes tax is the lowest throughout the US with only 7 cents per pack.
In conformity with the State legislation, the Rhode Island smokers can legally keep a carton of cigarettes bought outside of the state. In case somebody is caught on possessing more than one carton of such cigarettes, he is to be taken into custody, facing a possible sentence of $5,000 fine and a prison term.
The state is changing the color of its stamp to make sure that no one confuses it with the Virginia stamp. Englert said that state officials switch colors every three years or so to stay one step ahead of criminals who deal illegal cigarettes.
During the last couple of years, Rhode Island Police Department has been busy cracking down illicit cigarette sales. In 2007, the Cranston police confiscated almost 2,000 packs of smuggled cigarette which either lacked tax stamps or had South Carolina stamps on them.
Last year police made several raids to Providence convenience stores, with more than a half of the raids ended in seizing contraband cigarettes and subsequent arrests.
Last summer, the Warwick police agents detained 3 immigrants with smuggling and distributing almost 10,000 packs of cigarettes that lacked excise stamp tax.
The law-enforcement officials admitted that the latter case contributed to $12,900 in lost revenue.
The Rhode Island tobacco industry is strictly regulated.
According to the Division of Taxation, there are only 25 companies that have the license to sell cigarettes within the state. Each of those companies is subject to purchase 30,000 tax stamps to mount to every cigarette pack.
The wholesalers use special devises that take each pack of cigarettes from the carton and mount the stamp using heat.
