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Black market cigarettes on the horizon: report

A Pew report found a correlation between New York's high cigarette taxes and a burgeoning cigarette black market.

Credit: Getty Images Credit: Getty Images

The occurrence of cigarette trafficking is becoming common as New York City’s cigarette taxes rise, according to a new Pew report: Just last month, authorities busted a massive interstate cigarette-trafficking ringwith alleged connections to Hamas,and last Tuesday the alleged leader of a cigarette smuggling ring was held on $15 million bail for selling $50 million of untaxed cigarettes across New York City.

Taxes on cigarettes in New York City are the highest in the nation and as a result, the report says, New York is also the largest importer of smuggled cigarettes.

More than 60 percent of all cigarettes consumed in New York were smuggled in to avoid taxes, according to the Mackinac Institute of Public Policy. The high rate of smuggling is believed to have resulted in a loss of about $1.8 billion in 2011.

 
 
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