New York City

How New York City's Steep Cigarette Taxes Create Crime and Grow Big Government

The Nanny State encourages foul habits.

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Back around the turn of the millennium New York had a mayor named Rudy Giuliani, who was sort of the Chris Christie of his day. He was a Republican, and a conservative if you're grading on a curve, and he fancied himself a teller of hard truths. So when he and Virginia's governor at the time, Jim Gilmore, had a difference of opinion about garbage shipments, Giuliani gave the commonwealth what-for.

The Big Apple spits out a lot of trash, and it has to go somewhere—somewhere else, that is. The city closed its last landfill on Giuliani's watch, which hiked the already substantial volume of NYC garbage shipped to Virginia.

When Virginians got wind of this—thanks partly to a public announcement by Giuliani, who was running for re-election—they objected. Gilmore pronounced himself outraged and pledged to stop the barges. Lawmakers, sensing a winning issue, puffed out their chests and started drafting legislation to that effect.

Giuliani ruffled his own plumage in return. He pointed out (sensibly enough) that while the city paid waste companies to haul the trash away, it had no say in where the stuff went after that. He noted (correctly) that New York garbage is no worse than Virginia garbage. He predicted (accurately, as it turned out) that courts would conclude banning the barges violates the Constitution, which stipulates that only Congress can regulate interstate commerce.

And then he stuck his foot in it.

Giuliani claimed Virginians had an "obligation" to take New York garbage—because after all New York, which was God's gift to the arts, had graced the world with a variety of cultural blessings, of which Virginians sometimes took part. Taking New York's trash therefore evened the scales again, or something.

You can imagine how that went over. Virginia promptly banned New York garbage shipments. Waste Management, Inc., challenged the law in court and won. Time wore on, and the whole affair eventually was forgotten.

So why dredge it all up again now? Because New York is once again exporting nasty stuff to the commonwealth: crime and big government.

Thanks to New York's laughably high cigarette taxes ($4.35 state plus another $1.60 in the city) and higher prices generally, a pack of smokes in New York City costs $14 or more. That creates a powerful incentive to smuggle smokes in from states such as Virginia, where you can buy a pack for a third of that price. Fill a Ford Econoline van with a few hundred cartons and you can make a nice five-figure profit in a weekend. Some people do.

The robust cigarette smuggling irritates officials in New York, because they miss out on a lot of tax revenue. The trade irritates officials in Virginia for the same reason, because smugglers buy wholesale to avoid the retail sales tax.

There's an easy fix for all of this: Cut New York's cigarette taxes. (Virginia could hike its own tax, but then Virginia didn't create this problem—New York did.) Yet cutting the cigarette tax would deprive New York of revenue, and we mustn't have that, oh no. Besides, it would send the wrong signal. New York wishes to make people stop smoking, and punitive taxes are the way to do that without outright banning tobacco, which would be too obviously narrow-minded.

So apparently it falls to Virginia to find a solution to the problem New York created. The state's crime commission is considering several, including requiring retailers who sell tobacco to buy a special license. Revenue from the licensing could then help fund anti-smuggling operations, which would be handled by the Department of Alcoholic Beverage Control. Virginia sells hard spirits in state-owned stores; there's more money for the government that way.

In short, the answer to a problem caused by governmental heavy-handedness in New York is to increase the degree of governmental heavy-handedness here. Isn't that always the way?

Before crossing that Rubicon, however, we first should revisit the implied calculus of the cross-state relationship. Under what one might call Giuliani Equilibrium, Virginia took both New York's good (Broadway musicals) and its bad (dumpster drippings). Now we have a new variable: smuggling, and the criminality attendant thereupon. This adds a negative to the Virginia side of the equation.

Before we add further negatives—more government, higher fees on retailers, etc.—we should first ask New York to correct this. Since it probably won't do so by cutting cigarette taxes, perhaps it could increase its output of cultural amenities. Even better, it could make Virginia the first stop for all traveling exhibitions and shows.

Contrariwise, New York could agree to import something particularly repellent and loathsome from Virginia. There are several possibilities to choose from. How about, for starters, requiring New Yorkers to preface all catty remarks about others with the two-faced disclaimer, "Bless his heart"?

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  1. It also kills people.

  2. For RC Dean – it’s been awhile:

    A. Barton Hinkleheimerschmidt.
    His name is my name, too!
    Whenever we go out
    people always shout,
    “There goes A. Barton Hinkleheimerschmidt!”
    LALALALALALALA….

    BOOYAH

    hth

    *flexes in front of Morgan Fairchild poster*

  3. Fill a Ford Econoline van with a few hundred cartons and you can make a nice five-figure profit in a weekend. Some people do.

    “My brother-in-law just made a five-figure profit by hauling cigarettes from Virginia to New York City and you can do it, too! Just click on this here link…”

    1. when did you become anonbot? And the real question: how much money did your Aunt Gladys make selling smokes from her computer?

    2. Were your fired for the past 6 months, but now have a cheque for $35671??!?!?!

  4. “Thanks to New York’s laughably high cigarette taxes ($4.35 state plus another $1.60 in the city) and higher prices generally, a pack of smokes in New York City costs $14 or more.”

    Remember, the current mayor if NYC is all about helping the poor and fighting inequality. So I guess he’s going to move swiftly against the regressive taxes that permeate his city’s legal regime, and make the cost of living soar, like this one, right?

  5. “There’s no way to rule innocent men. The only power government has is the power to crack down on criminals. When there aren’t enough criminals, one makes them. One declares so many things to be a crime that it becomes impossible for men to live without breaking laws.”

    1. This^ I’d add that you have make theft and counterfeiting legal when done with govt sanction to make this circle complete.

  6. 14$ a pack isn’t so bad. Oh, you’re talking cigarettes?

  7. Never cheat the tax man in NYC or you will be choked to death.Do these people not understand that making a cheap good,that many want,very costly it will lead to a black market?Ever read the history of alcohol? By the way,why are they not bitching about the Indian reservations?

    1. why are they not bitching about the Indian reservations

      They’re working on that – soon, if not already, Indians have to charge tax on cigs too. It really is impressive how evil the state is getting in order to feed the giant tax maw.

  8. Google pay 97$ per hour my last pay check was $8500 working 1o hours a week online. My younger brother friend has been averaging 12k for months now and he works about 22 hours a week. I cant believe how easy it was once I tried it out.
    This is wha- I do…… ?????? http://www.jobsfish.com

  9. Just make it illegal altogether. That’ll stop people from smoking.

    /sarc

    1. They don’t give a shit about people quitting – in fact, it would be a disaster if everyone quit because smoking props up the whole rotting edifice.

      1. if they want people to stop smoking, have them go out and buy their own health insurance. Go ahead, check that smoker box….

  10. CT taxes on tobacco are also quite high, BUT state has NO incentive to reduce smoking because it uses the tax revenue from tobacco as part of the general revenue funds.

    A drop in smokers means a drop in tax revenue – except CT will raise other taxes to make up for lost tobacco revenue.

    Smokers keep taxes down for other residents.

  11. Seeing the same thing repeated in the states which legalize pot. Instead of simply paying a sales tax, they layer on massive taxes.

  12. Its just another excuse for my home state to pull people over and use civil asset forfeiture to steal from us.

  13. So, could we blame NYC’s obsession over the taxes on cigarettes with the death of Eric Garner?
    It seems to be a natural progression.

  14. Start working part time. I kept hearing other people tell me how much money they can make online so I decided to look into it. Well, it was all true and has totally changed my life.
    == BEST FAMILY DEAL .. ??w?w?w.M?o?n?e?y?k?i?n.c?o?m?

  15. Tax anything at truly ridiculous levels and said taxation will sooner or later bring forth criminal acts intended to get around or avoid said ridiculous levels of taxation. If anyone reading the foregoing has any questions,I submit that they should not.

  16. And now the global war on tobacco is costing lives. Try selling bootleg cigs in NYC.

  17. In Eric Garner’s death at the hands of Mayor deBlasio’s cigarette enforcers, reporting has pretty much overlooked what actually led to his take-down in the first place. I’m asking any who agree it’s unjust for tobacco-dependent citizens to bear confiscatory taxation to “Share” this song.
    (We’ve had it on the internet since 2012.) https://www.youtube.com/watch?v=RpXjVq5Q6S0

  18. Can we get a ban on California Legislators? They are definately health hazards.

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