CQ TODAY MIDDAY UPDATE
April 28, 2009 – 2:00 p.m.
House Panel Approves Bill to Deter Illegal Sales and Smuggling of Tobacco
A House panel approved legislation Tuesday aimed at combating illegal Internet cigarette sales and the smuggling of tobacco.
The House Judiciary Committee by voice vote approved a bill that would require tobacco sellers to verify the age of buyers who purchase products online or over the phone, and would require sellers to keep delivery sales records.
The bill also would require sellers of cigarettes and smokeless tobacco to include notices about excise tax requirements and would bar shipments of cigarette or smokeless tobacco that weigh more than 10 pounds.
Sellers who violate the new rules could face up to three years in prison or civil penalties of up to 2 percent of their gross sales for the year before the violation.
As states have increased their tobacco taxes, smugglers have taken to selling tobacco products on the Internet to avoid paying local taxes, said Rep. Anthony Weiner , D-N.Y., the bill’s sponsor.
The illegal sales have affected state revenue, according to ranking Republican Lamar Smith of Texas. In California, state officials estimate that purchasers do not pay taxes on as much as 15 percent of all tobacco sold.
Before approving the measure, the panel adopted by voice vote a Howard Coble , R-N.C., amendment that would make an exception for tobacco mailings intended for consumer testing by manufacturers.
The panel also adopted by voice vote a Robert W. Goodlatte , R-Va., amendment that would express the sense of Congress that the measure does not set a precedent regarding states’ ability to collect sales tax on out-of-state entities.
Comments
This is just another reason for state sovereignty! The Fed should just keep it's nose out of it! It's definitely time to throw all these bums out on their tushes!
Legislators are running scared. They figured out taxing smokers in a shrinking market will loose revenue. Prohibition never has worked so they will keep on making mistakes to correct the problem they have created. One Senator stated on the floor of the senate, it will take 20 million new smokers a year to keep Schip from going under within 4 to 5 years. With smoking declining from 54% to 24% and down, why would anyone expect an increase in revenue? Legislation and stupidity are not a good mix. That same mix is the cause of the meltdown. That same mix is costing us Trillions now and into the future.
States are going to be very disappointed. Of the last 40 states to pass a new cigarette tax only 8 saw a rise in revenue and the others saw as much as a 68% drop. With this new Federal tax there is going to be an even a larger drop in revenue. When will these idiots understand they are taxing poor people into quitting with no hope of generating more income. You cannot hope to increase revenue and drive the very thing you are taxing out of business. This is going to cost the Federal and State Governments the Billions they are hoping to get plus Billions less than they are receiving now. Greed and stupidity are not a good mix. One Senator, on the floor of the Senate, said we will need 22 million new smokers to keep the SCHIP program funded. Without new smokers it will fail within 2 to 4 years. Has anyone noticed that smoking has gone from 54% to less than 24%? Looks like the smokers will be joined by all the Non-Smokers in paying for this SCHIP program the Anti-Smokers are so proud of. Then you will hear some real bitching. Being open to others being over taxed comes back to bite you and it will. It's called Socialism and other ism's we won't like.
The percentage of smokers, I believe is incorrect. Twenty-four percent, who admit they smoke maybe. There are many smokers who do not admit it and still more who are smart enough to grow their own. Unfortunately, they're opening the door even wider for blackmarketeers. Where there's a will, there's a way. It's also ashame that government is making criminals out of law abiding citizens....aren't prisons overrun as it is? *shakes my head at stupidity.
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