News from New York Association of Convenience Stores
For more information contact: James Calvin, 518-432-1400
ALBANY, NY (08/27/2009) -- New York's convenience store industry today cheered Wednesday's ruling by U.S. District Judge Carol Amon temporarily barring smoke shops on Long Island's Poospatuck Indian reservation from selling vast amounts of untaxed cigarettes to people outside the tribe.
But the New York Association of Convenience Stores said Gov. David Paterson, rather than the courts, holds the key to solving the enormous loss of state tax revenue from continued Indian sales of cigarettes to non-Indian customers statewide.
This tsunami of cigarette tax evasion - tacitly sanctioned by the Paterson administration - has destroyed mom-and-pop retail stores, deprived the State of $1 billion a year in desperately needed revenue, and undermined the effectiveness of the State's anti-smoking efforts.
"Under the U.S. Supreme Court's unanimous Attea decision of 1994, New York has the right to collect these taxes," said NYACS President James Calvin. "And under a law passed by the Legislature and signed by then-Governor Pataki effective March 1, 2006, New York has the duty to collect these taxes. Why Governor Paterson refuses to enforce it in the face of a $3 billion budget deficit is a mystery for the ages."
A separate injunction imposed by State Supreme Court Justice Rose Sconiers currently prohibits Governor Paterson's Tax Department from enforcing the March 2006 tax collection law, but only until such time as the Department issues the tax-exemption coupons prescribed by the law in order to preserve the undisputed tax exemption on tribal sales to other tribal members. "They claim they're enjoined, but the truth is they are enjoining themselves," said Calvin. "They have the coupons, and it's within their power to send the coupons to the tribes, rendering the injunction moot. They just refuse to act. It's mind-boggling."
Resources:
- "An Update: Additional Cigarette Tax Revenue Sources for New York State," Brian P. O'Connor Ph.D. for NYACS, February 2008
- "Perspectives on the Cigarette Tax Fairness Issue," NYACS, November 2008
- Decision on Preliminary Injunction
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