Federal Court Bars Reservation From Selling Cheap Cigarettes
New York, NY —
New York smokers looking for cheap cigarettes might be looking a little harder this week. A Federal court barred at least five shops on Long Island's Poospatuck Reservation from selling tax-free cigarettes to anyone who isn't a member of the tribe.
The city's Law Department says at least one smoke shop on the reservation has shut down since Friday's ruling. But it has unconfirmed reports that several other shops are still in business.
New York City sued eight shops on the reservation last year. The government alleges the tax-free sales were cheating the state and city out of hundreds of millions of dollars in revenue per year.
Tribes can sell cigarettes tax-free to tribe members, but must collect taxes on all other sales.
New York City has the nation's highest cigarette taxes. On the reservation, cigarettes are often priced at half what they would go for in the city.
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