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Title: Bay State Officials Want To Emulate the Drug War to Collect Cigarette Taxes
Source:
Reason
URL Source: https://reason.com/archives/2016/06 ... -officials-want-to-emulate-the
Published: Jun 7, 2016
Author: J.D. Tuccille
Post Date: 2016-06-08 08:38:43 by Deckard
Keywords: None
Views: 6398
Comments: 37
In response, the state established the Illegal Tobacco Task Force, to crack down on those subjects who refuse to be passively milked or else give up on their vice. That unholy committee of cops and revenooers has come up with a plan for victory in pursuit of its "mission to confront and combat the illegal tobacco trade in Massachusetts": import personnel and tactics from the war on drugs. Because we all definitely look to drug prohibition as a model for success, right? Well, not all of us—a lot of police, health professionals, and prosecutors are having doubts. More on that later. In its initial report, released two weeks ago, the task force complains: "Several recent studies have indicated that approximately 11.9%-12.7% of all cigarette packs sold in the metro Boston area failed to bear a valid Massachusetts tax stamp. Another study using different methodologies and testing techniques estimates the size of the illegal cigarette market in Massachusetts at 15.53%." Just as concerning for officials, smuggling has bled over into the growing market for "other tobacco products" including cigars and chewing tobacco, though the scope of the illegal trade is harder to measure. This is a serious problem, we're told, because "cigarette smuggling costs the Commonwealth millions of dollars in lost revenue year over year." Unsurprisingly, black market goods are brought in from states where tobacco is taxed at a lower rate—which is to say, almost anyplace else. Actually, the Task Force—a collaboration between the Department of Revenue and the State Police—may be underestimating the amount of cash slipping through its fingers. The Mackinac Center for Public Policy, the go-to authority on American cigarette smuggling, tracks this sort of trade across the entire country. Its latest estimates, released in 2014, did indeed put smuggled cigarettes at 12.71 percent of the market. But that was before Massachusetts hiked the tax by $1.00 per pack to $3.51. A 2013 study also produced before the tax hike found that nearly 40 percent of discarded cigarette packages in Boston bore out-of-state tax stamps. And why not bring them in from elsewhere when cigarettes are taxed at $1.78 per pack in New Hampshire, $1.60 per pack in Pennsylvania, and $0.30 per pack in Virginia? That's quite a savings. As for those other tobacco products, smokeless tobacco is taxed at a rate of 210 percent of wholesale cost, while cigars and smoking tobacco are taxed at 40 percent of wholesale cost. Pennsylvania doesn't tax such products at all. Smuggling may be a problem for tax-hungry state officials, but it's just good sense for Massachusetts residents trying to enjoy the pleasures of life. Understandably, that high tax differential creates a lot of space for underground entrepreneurs to profit by keeping those pleasures affordable. "[O]nce taxes get far enough out of whack among states, basic economic incentives almost guarantee a thriving black market—and, eventually, an arms race between enforcement and motivated cigarette traffickers," the Boston Globe noted in a 2014 article on the illicit trade. In the seemingly inevitable way of governments everywhere, Massachusetts officials appear to have embraced that arms race rather than consider de-escalation of any sort. In particular, they point with envy to enhanced penalties and enforcement powers in Rhode Island that, among other things, "expanded investigators' authority to search the premises of tobacco dealers and suppliers at all levels of the supply chain." Hmmm… Draconian punishment and weakened search and seizure protections. What could the Task Force be getting at here? Oh wait, here it is: representatives of Connecticut and New York law enforcement invited to advise their Bay State neighbors "noted the close similarities between narcotics investigations and illegal tobacco investigations. As a result, they suggested trying to find experienced narcotics investigators (often former police officers) to be part of any tobacco investigations team." It's not only personnel. Smoke-tax enforcers advising the task force also recommended increased surveillance, use of paid informants, and undercover operations in order to target the black market created by high state tobacco taxes. In other words, enforcement of taxes on cigarettes and other tobacco products should look increasingly like decades-old efforts behind laws against marijuana, cocaine, heroin, methamphetamine and the like—prohibition efforts that have brought ever-growing demands for more law enforcement power and resources because, like efforts to stamp out cigarette smuggling, they haven't worked. "The war on drugs has been a tremendous failure," Houston Police Chief Charles McClelland admitted in October of last year at the launch of Law Enforcement Leaders to Reduce Crime and Incarceration, an effort in which he's joined by New York City Police Commissioner William Bratton, Los Angeles Police Chief Charles Beck, and Washington, D.C. Police Chief Cathy Lanier, among other criminal justice system veterans. They want to dial back harsh criminalization and lengthy sentences that have filled prisons with nonviolent offenders. They echo the call of the former cops and prosecutors of Law Enforcement Against Prohibition who have made similar—and stronger—arguments for years. Likewise, the World Health Organization considers prohibitionist policies counterproductive and now urges that "Countries should work toward developing policies and laws that decriminalize injection and other use of drugs and, thereby, reduce incarceration" and ease access to health care. WHO also favors decriminalizing sex work and homosexuality for the same reasons. Health professionals, police chiefs, and prosecuting attorneys now say that the surveillance tools, intrusive investigations, criminalization, and brutal penalties accumulated over decades of drug prohibition have been terrible and damaging mistakes. But tobacco regulators in Massachusetts and elsewhere seem to think that they'll be brilliant additions to efforts to squeeze people for taxes on their smokes. Harsh tactics may have failed to stamp out the trade in heroin and cocaine, but they’ll totally work against tobacco smugglers.
Massachusetts has a problem with cigarette smuggling—a problem, that is, from the point of view of tax collectors and government regulators. State officials have hiked tobacco taxes so high in pursuit of the twin not-so-compatible goals of enhancing revenue while also discouraging smoking that people are buying their smokes on the black market, smuggled in from low-tax jurisdictions or overseas.
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#1. To: Deckard (#0)
Is anyone surprised? Well, aside from all the dopers who think we should legalize marijuana and "tax the hell out of it" to raise tons of revenue.
Because we all definitely look to drug prohibition as a model for success, right? Well, not all of us—a lot of police, health professionals, and prosecutors are having doubts. More on that later. In its initial report, released two weeks ago, the task force complains: "Several recent studies have indicated that approximately 11.9%-12.7% of all cigarette packs sold in the metro Boston area failed to bear a valid Massachusetts tax stamp. Another study using different methodologies and testing techniques estimates the size of the illegal cigarette market in Massachusetts at 15.53%." Just as concerning for officials, smuggling has bled over into the growing market for "other tobacco products" including cigars and chewing tobacco, though the scope of the illegal trade is harder to measure. The womb, the most dangerous place on earth.
$0.30 per pack in Virginia? Not smoking I didn't realize that. Looking it up I see NYS has the highest at $4.25.
To save $40 per carton? You bet.
Is anyone surprised? Well, aside from all the dopers who think we should legalize marijuana and "tax the hell out of it" to raise tons of revenue. If you think Colorado’s legalization of marijuana retail sales killed the black market, think again.
Of course, the instant that it is legalized they no longer want to "tax the hell out of it."
The history of Prohibition and its end shows the way; from your link: 'First, instead of cracking down on bootleggers and speakeasy operators, Gregory gave them amnesty and issued licenses to anyone willing to play by the state’s rules. Second, backed by the governor and his influence in the Senate, Gregory arranged for alcohol taxes to be set as low as any in the nation, which allowed those willing to follow the law to keep a significant amount of their profits, and it made room for legal operators to compete with bootleggers’ prices. Third, Gregory punished anyone who broke the rules—even once—with an iron fist, blacklisting them from ever making or selling alcohol in the state again. 'Predictably, this caused some turmoil in a legislature anxiously awaiting an infusion of cash from liquor sales, but the governor backed Gregory. Faced with a low cost of entry and legal profits, bootleggers and speakeasies around the state mostly turned legitimate. Meanwhile, the few remaining stragglers were quickly put out of business, and drinkers flocked to a competitive legal market. 'That might have been the end of it, but there was one more piece to Gregory’s plan. After holding down taxes—and thus prices—for three years, Gregory abruptly raised taxes so much that they were among the highest in the nation. The price of booze went up, of course, but people kept buying legal liquor and beer. There was no alternative left. Gregory had broken the back of the black market.' A government strong enough to impose your standards is strong enough to ban them. After reading this and a google search I just told a guy outside smoking to buy his cigarettes in VA.
Other than driving to an adjacent state and buying it there.
Other than driving to an adjacent state and buying it there. Which, by this account, few if any did. A government strong enough to impose your standards is strong enough to ban them. It really didn't say, did it? The point seemed to be that this tactic was useful in shuttng down the black market in alcohol. Given the price of legal marijuana in Colorado, obviously that's not their intent. Everyone up and down the legal supply chain is looking to make a killing on "just a plant", resulting in legal marijuana being more expensive than the black market. So why you referenced it is a mystery to me.
Never attribute to malice what can be explained by incompetence - liberals seem to genuinely believe that wishes are horses. The relevance is that all Colorado would need to do to practically end the pot black market is what was done to end the alcohol black market; whether they have the sense or will to do so is another question. A government strong enough to impose your standards is strong enough to ban them. Even with zero taxes, legal marijuana is priced about the same as black market. And why wouldn't it be? Secondly, marijuana is nothing like alcohol. Anyone can buy seeds and produce quality marijuana with very low overhead. How are your wine-making skills? Can you produce a quality bourbon or scotch? Got some large stainless steel vats laying around to make beer?
Once marijuana is legal and high taxes are applied, their argument will then be, "You're driving sales underground! Lower the taxes!"
Restricting all marijuana sales to state-owned stores?
If so (and we have only your word for it) legal pot stil enjoys the considerable advantages of being legal: for instance, one doesn't have to participate in lawbreaking (thereby risking the legally prescribed penalty) to obtain it, nor deal with shady characters under dicey circumstances. Anyone can buy seeds and produce quality tomatoes with very low overhead, yet many people buy tomatoes - because convenience has market value. (And I once grew some pot that didn't get me high, so doing it right ain't as easy as all that.) A government strong enough to impose your standards is strong enough to ban them. Many states did not restrict all alcohol sales to state-owned stores ... but such a restriction on legal pot would still be a significant improvement over the status quo. A government strong enough to impose your standards is strong enough to ban them. So you believe that state owned pot stores would put the pot pushers out of business. Can you say pipe dream?
LOL! Might as well have been - but I extracted the seeds from pot myself.
A government strong enough to impose your standards is strong enough to ban them. There is no significant black market in alcohol even in state-liquor-store-only states, as far as I know. A government strong enough to impose your standards is strong enough to ban them. If you are in possession of one or two ounces, no one knows where you got it and if you paid any taxes on it. Meaning legalization does not necessarily result in increased tax revenue. Nor does it regulate under 21 buyers (since they'll continue to do business with their current dealer). I see plenty of downside and no upside.
All no less true of alcohol, yet there's no evidence of a substantial black market in that drug. A government strong enough to impose your standards is strong enough to ban them. Irrelevant, unless you equate a black market in alcohol to a black market in marijuana.
Opposite - the burden is on you to state a relevant difference. (I stipulate the existence of irrelevant differences.) A government strong enough to impose your standards is strong enough to ban them. I gave you two -- the quality of the black market product and the startup cost.
Black market distillers can reasonably supply "only" the alcohol consumed by those who drink primarily for its effect - but since that's a hefty proportion of all alcohol consumed, you've at most noted a difference in degree between the negligible alcohol black market and what the pot black market would be when pot is legal. Growing black market pot without getting caught does not have "very low overhead" - one needs to either stake out, guard, and regularly travel to and from a secluded outdoor area or set up the equipment for an indoor grow. A government strong enough to impose your standards is strong enough to ban them. There is a significant black market in pot in licensed-pot-stores-only California
Drug warriors got their jobs back. They need to make living.
As long as there are drug addict warriors... there will be the war. The war on drugs has a new weapon... It's called Fentanyl. You should try it. lol I'm the infidel... Allah warned you about. كافر المسلح
There is a significant black market in pot in licensed-pot-stores-only California Pot in CA is legally more restricted than is alcohol in state-liquor-store- only states. A government strong enough to impose your standards is strong enough to ban them. And yet the black market in it is greater. You just blew up your state-liquor-store-only model solution.
Not 'mine', liar: "Many states did not restrict all alcohol sales to state-owned stores ... but such a restriction on legal pot would still be a significant improvement over the status quo." A government strong enough to impose your standards is strong enough to ban them. 2. Not 'mine' Jiminy Cricket, you are pathetic.
2. Not 'mine' I'm confident nobody else (with the possible exception of your little buddy) is fooled by your false dichotomy or even willing to pretend that they are. Go nip at somebody else's ankles, pee-wee. A government strong enough to impose your standards is strong enough to ban them. Put some ice on it.
"State officials have hiked tobacco taxes so high in pursuit of the twin not-so-compatible goals of enhancing revenue while also discouraging smoking that people are buying their smokes on the black market, smuggled in from low-tax jurisdictions or overseas."
#2. To: Deckard (#0)
#3. To: Deckard (#0)
And why not bring them in from elsewhere when cigarettes are taxed at $1.78 per pack in New Hampshire, $1.60 per pack in Pennsylvania, and $0.30 per pack in Virginia? That's quite a savings.
Sounds like VA is definitely the place to buy them.
#4. To: TrappedInMd (#3)
"Sounds like VA is definitely the place to buy them."
#5. To: misterwhite, Deckard (#1)
(Edited)
"State officials have hiked tobacco taxes so high in pursuit of the twin not-so-compatible goals of enhancing revenue while also discouraging smoking that people are buying their smokes on the black market, smuggled in from low-tax jurisdictions or overseas."
#6. To: misterwhite (#1)
Well, aside from all the dopers who think we should legalize marijuana and "tax the hell out of it" to raise tons of revenue.
#7. To: Gatlin (#5)
The Failed Promise of Legal Pot.
#8. To: Deckard (#0)
#9. To: ConservingFreedom (#7)
"The price of booze went up, of course, but people kept buying legal liquor and beer. There was no alternative left."
#10. To: misterwhite (#9)
"The price of booze went up, of course, but people kept buying legal liquor and beer. There was no alternative left."
#11. To: ConservingFreedom (#10)
"Which, by this account, few if any did."
#12. To: misterwhite (#11)
Given the price of legal marijuana in Colorado, obviously that's not their intent.
#13. To: ConservingFreedom (#12)
"all Colorado would need to do to practically end the pot black market is what was done to end the alcohol black market"
#14. To: Roscoe (#6)
"Of course, the instant that it is legalized they no longer want to "tax the hell out of it."
#15. To: ConservingFreedom (#12)
The relevance is that all Colorado would need to do to practically end the pot black market is what was done to end the alcohol black market
#16. To: misterwhite (#14)
#17. To: misterwhite (#13)
Even with zero taxes, legal marijuana is priced about the same as black market. And why wouldn't it be?
Secondly, marijuana is nothing like alcohol. Anyone can buy seeds and produce quality marijuana with very low overhead.
#18. To: Roscoe (#15)
Restricting all marijuana sales to state-owned stores?
#19. To: ConservingFreedom (#18)
#20. To: ConservingFreedom (#17)
I once grew some pot that didn't get me high
#21. To: Roscoe (#20)
#22. To: Roscoe (#19)
So you believe that state owned pot stores would put the pot pushers out of business.
#23. To: ConservingFreedom (#17)
"for instance, one doesn't have to participate in lawbreaking (thereby risking the legally prescribed penalty) to obtain it"
#24. To: misterwhite (#23)
If you are in possession of one or two ounces, no one knows where you got it and if you paid any taxes on it. Meaning legalization does not necessarily result in increased tax revenue. Nor does it regulate under 21 buyers (since they'll continue to do business with their current dealer).
#25. To: ConservingFreedom (#24)
"All no less true of alcohol, yet there's no evidence of a substantial black market in that drug."
#26. To: misterwhite (#25)
Irrelevant, unless you equate a black market in alcohol to a black market in marijuana.
#27. To: ConservingFreedom (#26)
"the burden is on you to state a relevant difference."
#28. To: misterwhite (#27)
the quality of the black market product
and the startup cost.
#29. To: ConservingFreedom (#22)
There is no significant black market in alcohol even in state-liquor-store-only states
#30. To: Deckard (#0)
#31. To: A Pole (#30)
#32. To: Roscoe (#29)
"There is no significant black market in alcohol even in state-liquor-store-only states"
#33. To: ConservingFreedom (#32)
Pot in CA is legally more restricted than is alcohol in state-liquor-store- only states.
#34. To: Roscoe (#33)
your state-liquor-store-only model solution.
#35. To: ConservingFreedom (#34)
1. There is no significant black market in alcohol even in state-liquor-store-only states
#36. To: Roscoe (#35)
1. There is no significant black market in alcohol even in state-liquor-store-only states
#37. To: ConservingFreedom (#36)
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