Missing Money from Cigarette Tax
WNYC News | Jul 12, 2010
New York, NY —
New York loses an estimated $270-million a year in tax revenues in sales of untaxed cigarettes on Indian reservations. And a state senator from Westchester says the way to get some of that revenue is to negotiate with Indian tribes to collect the cigarette taxes and split the revenue with the state.
State Senator Jeff Klein says while the state cigarette tax increased in 2002, tax receipts have declined from $1.12 billion in 2003 to $979-million in 2005. Under federal law, tribal members are exempt from state cigarette taxes, but nonmembers are not. Klein says tax-sharing deals are one of the most promising approaches to recoup lost revenue. He says he'll introduce a bill to enact his proposal.
