UPS Goes Smoke-Free

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Under pressure from New York Attorney General Eliot Spitzer, UPS has agreed to stop delivering cigarettes to consumers. The ban is part of an effort to prevent smokers from avoiding the state's $1.50-a-pack cigarette tax (a burden raised to $3 by New York City's local tax). Spitzer also has strong-armed DHL into eschewing cigarette deliveries and pressured credit card companies to stop processing payments for online cigarette purchases, which are illegal in New York. The next logical step is for Spitzer to demand that offline merchants in lower-tax states stop abetting tax evasion by selling cigarettes to New Yorkers. Shouldn't every tobacconist, supermarket, and convenience store have to do residency checks on cigarette buyers? And how long will it be before a similar approach is used to prevent people from avoiding sales tax by buying anything online, or by buying products while visiting other states?

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  1. Exactly how does UPS know whats in the package?

    I imagine a lawsuit will be following shortly.

    Screw Spritzer…

  2. I’m wondering what the other side of this agreement was. What is UPS getting in exchange for refusing business? Tax incentive? Or was this a strong arming that threatened a lawsuit?

  3. Sounds like monopolistic behavior to me.

  4. Sounds to me like an actual, real interstate commerce issue.

  5. Screw Spritzer…

    Spitzer don’t make the laws in this area. Rather, he just enforces them, as he well should. The blame, if blame is to be apportioned at all, lies elsewho.

  6. “Spitzer don’t make the laws in this area. Rather, he just enforces them, as he well should.”

    Oh, come on. He certainly has a ton of discretion over which laws to emphasize and how much effort to put into enforcing them. All he’s doing is high-profile dick-waving in preparation for his run at elective office. He’s good at that.

  7. well pressuring UPS into not delivering cigarettes is not even enforcing a law. the law is against buying cigarettes online. this is basically enforcing the spirit of that particular law with political clout.

  8. Where is this “law” against buying cigarettes online, zach?

  9. I thought law enforcement was in charge of enforcing laws, not “spirits.”

  10. It’s all about self-promotion and keeping the ever-ravenous government beast well-fed.

  11. My father works for FedEx, and they regularly deliver “prohibited material”, as it is nearly impossible to discern what is inside a package, and the companies usually don’t want to waste money doing the government’s “job”.

  12. What about the boxes of evil wishes and stabby thoughts I get from my ex-wife every month? Any chance of that being curtailed?

  13. Can’t somebody force Spitzer to testify before a grand jury and make him indict his own ham sandwich? The guy gives me the creeps.

  14. And how long will it be before a similar approach is used to prevent people from avoiding sales tax by buying anything online, or by buying products while visiting other states?

    I don’t know about visiting other states, but it’s already required in NYS to declare the state sales tax from online purchases on your tax form. I have no idea how they expect to enforce that.

  15. Oh, come on. He certainly has a ton of discretion over which laws to emphasize and how much effort to put into enforcing them.

    There is such a thing as prosecutorial discretion, but not when it comes to payment of taxes. The rule on tax provisions is that they are always supposed to be vigorously enforced because every unenforced tax provision means effectively that I will end up paying more deficit over the long run. In other words, this ain’t a victimless crime, EVER.

    I am quite sympathetic to the claim that NYS shouldn’t tax cigs, or tax them less, or whatever — however, once they lay a tax burden down, I expect it to be enforced so that they don’t end up looking to me for the shortfall.

    Aint nuttin unlibertarianesque about that.

  16. Maybe there _is_ an unseen power of universal and ironic justice and Spitzer, while crossing the street one day, will get run over by a cigarette smuggler.

  17. First they came for the cigarettes, and I said nothing, because I am not a smoker….

  18. So, when I lived in New York and bought several cartons from Philly on one of my visits, I was guilty of “tax evasion”? Fuck you.

  19. once they lay a tax burden down, I expect it to be enforced so that they don’t end up looking to me for the shortfall.

    One would think that they’d look at cutting spending first, but… oh well.

  20. Fuck you.

    Ahhhhh, the old Al Capone defense.

  21. Adam,
    Where is this “law” against buying cigarettes online, zach?
    sorry, i was just going by the above blurb where Mr. Sullum refers to “online cigarette purchases, which are illegal in New York.” i don’t live in new york and i don’t know the law there.

    I thought law enforcement was in charge of enforcing laws, not “spirits.”
    my point exactly. Dave W. was defending Spitzer on the grounds that he’s simply enforcing the law, and that’s what i was responding to.

    Stretch,
    So, when I lived in New York and bought several cartons from Philly on one of my visits, I was guilty of “tax evasion”? Fuck you.
    maybe you should just stick around down here in philly. you seem like you’d fit in just fine.

  22. cutting spending

    Cutting spending is an excellent policy objective, especially for a “fearless lib” like me.

    However, that is the job for the legislature, not the state attorney general. Any other approach is a little too Andrew Jacksonian for me.

  23. Dave W. and zach, what law is UPS violating here? UPS made this decision under pressure from Spitzer, not because they were technically violating any law. They could tell Spitzer to go spit (like, hilariously, the US Postal Service has done, let’s see you take out that bureaucracy, Napoleon) if they chose too.

  24. Shouldn’t every tobacconist, supermarket, and convenience store have to do residency checks on cigarette buyers?

    I got carded once in Virgina for buying two cartons of Camels. The clerk sheepishly explained that they’re not allowed to sell more than a carton to out-of-staters.

  25. I am just waiting to see how this plays out with the Indian reservations which sell those cheap smokes online, like the Seneca Reservation in New York.

  26. UPS made this decision under pressure from Spitzer, not because they were technically violating any law.

    Trafficking.

  27. This reminds me of the time I moved from California to Washington state. My first set of Washington license plates cost me a couple thousand dollars, as I recall. Washington charged me state sales tax, or rather the state sales tax I would have incurred two years earlier if I had bought the car in Washington instead of California.

    For that matter, California wants to go after people who, while employed in Caifornia, had part of their wages placed taxfree into 401K accounts. Since taxfree included free of state income tax at the time, California wants to recoup the state tax after one retires and draws down on one’s 401K.

    The fact that a person may choose to retire outside Caifornia, escaping the state income tax altogether makes California very angry.

  28. Spitzer is a horrible AG, and just about every move he makes is to keep his name sufficiently in the limelight to have a shot at the gubernatorial mansion. Look at his cases–almost all hotbutton issues, never something boring and unlikely to get major media attention. He’s also notorious for asserting authority where there is virtually zero blackletter support for his position, not to mention his absurd belief that New York has jurisdiction over the rest of the United States. He’s extraordinarily dangerous, because he has no respect for the rule of law or for the idea of limited government. And this has nothing to do with politics–even if I thought his ideology was pure, I’d still find his methods to be. . .unsound.

    Professor Bainbridge has had a few choice words for Spitzer.

  29. Don Mynack, again, this is my point exactly. so far both you and dave have thought i was making the opposite point. maybe there’s something wrong with my keyboard…

    MP, Trafficking.

    i suppose that case could be made, but if the guys who run UPS had any balls they’d tell Spitzer to give em his best shot. after all, how is UPS supposed to know which cartons of cigarettes have been ordered by phone and which have been ordered online?

  30. I am just waiting to see how this plays out with the Indian reservations which sell those cheap smokes online, like the Seneca Reservation in New York.

    I guess that depends on whether Spitzer has convinced your local post office to confiscate your cigarettes, as he has done mine. I used to have them delivered by the Swiss post–until my last order simply never arrived.

    Does anyone know the going rate for a carton of cigarettes in Hoboken or Jersey City?

  31. Rhywun

    Slightly cheaper I believe. Once you figure in price of PATH, you’d probably save around $10.

    But, you could stop for a while and enjoy a smoke IN a bar before you head back 🙂

  32. you’d probably save around $10

    That’s all? Hardly worth it.

  33. Yes, but just think: the taxes you’d pay on cigs in NJ will not go towards paying Spitzer’s salary.

  34. Yes, but just think: the taxes you’d pay on cigs in NJ will not go towards paying Spitzer’s salary.

    No. Somebody else’s taxes will have to be increased to pay that salary. That person of the crime victim here. The crime is called tax evasion. UPS can choose to co-operate with police investigations or not. We are free to criticize UPS’s excercise of free will. Personally, I don’t criticize. I have too much sympathy for the crime victim because to me, few ppl are more sympathetic than someone who is forced to subsidize somebody else’s taxes by dint of prosecutorial favortism.

  35. Dave W., buying an identical product in a different state because it’s cheaper there is not tax evasion and is not a crime.

  36. No. The crime happens later. When you fail to pay the tax as required by law.

  37. presumably, you did pay whatever tax was charged in the other state. you don’t have to pay taxes in your home state for something you didn’t buy there.

  38. Does the UPS ban apply to cigars and pipe tobacco?

  39. Yes, but just think: the taxes you’d pay on cigs in NJ will not go towards paying Spitzer’s salary.

    No, they’ll go toward paying the even more corrupt crooks who run NJ.

  40. Somebody else’s taxes will have to be increased to pay that salary.

    Gee, I wonder how Spitzer survived before NY decided to tax the shit out of cigarettes. Maybe he was out on the street panhandling?

  41. We are free to criticize UPS’s excercise of free will.

    And you feel no need to criticize punitive “sin” taxes? If Eliot Spitzer decides to double the tax on cheeseburgers, you’ll pay it happily?

  42. Why is it always suck the goverment ‘pressures’ big business to do something. Ahem, Trial of Hank Rearden?

  43. And to quote Mitch Hedburg: “I love the UPS man. He’s a drug dealer, and he doesn’t even know it. And he’s always on time.”

    I think UPS has other things to worry about, and it would be in the gov’ts best interest to let them handle those.

  44. Dave W,

    If a person decides not to buy cigarettes at all, because the state tax makes them too expensive, the state will also lose potential tax revenue and thus force the state to find other sources of revenue. Are they also forcing others to pay more in taxes? Should Spitzer go after them too?

  45. Live in a native community in southern Ontario, Canada. In the past 12 months we’ve gone from one gas station and a variety store here to over half a dozen shops selling cigs. We’re talking a LOT of smokes. Cars lined up 20 minutes before the shops open. I waited one day to buy a coffee at one of the shops and a bingo-mama (elitist superior observation ahead) you know, lower-middle class look peeled off something like $500 from a wad of twenties she had, with plenty left over, and then one of the employees brought out a large cardboard carton full of cigarettes which she loaded in her car.
    This shit though sounds like the beginning of an attempt to control commerce on the net to get their little piece of the pie.

    Is it me or does it seem to get more sneaky, deceptive and downright nasty every day when it comes to government?

    LotR

  46. “presumably, you did pay whatever tax was charged in the other state. you don’t have to pay taxes in your home state for something you didn’t buy there.”-zach

    Yes, you did pay the local tax, but, technically, your home state does not care about that. I believe, in most, if not all states you are required to pay your home state’s sales tax on any item you bring back home. However, in most circumstances, a state cannot enforce such taxes, as most people ignore the law (if they are even aware of it), and the amount of tax revenue gained is not worth the cost of enforcement.

    This is part of what the argument is about not having state sales taxes on online purchases. It is not that no tax is required to be paid, it that the onus for submitting the tax is on the consumers. The states would like it put on the sellers, who are easier to target legally.

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