Quote of the Day - I have a punishing workout regimen. Every day I do 3 minutes on a treadmill, then I lie down, drink a glass of vodka and smoke a cigarette.
MITPC is not a cigarette smoker, but as an occasional cigar smoker, I'm somewhat sympathetic to these New Yorkers' plight. They bought cheap cigarettes over the internet, and had them shipped to the Big Apple.
As one of those perhaps unintended consequences of the internet - more likely intended - the New Yorkers were able to avoid paying New York city sales tax on the cigarettes. Some $33.5 million before the City realized what they were missing.
Not about to sit still and lose that kind of revenue, the City went after the vendors seeking payment of the tax. One company, eSmokes, claims to be bankrupt, and the AP story linked above notes that calls and emails soliciting comment were not returned. As you can see from the last link, however, the site is still up and running, and contains what is calls legal disclosures essentially claiming that your purchase is point-of-sale in either North Carolina or Kentucky.
The site also encourages you to write to your Congressional representative about a bill affecting taxation of internet cigarette sales, but you don't need to get your pen ready. The bill appears to be stuck in committee.
eSmokes and NYC were able to reach a settlement, however. The internet vendor agreed to give up the names and addresses of everyone in New York who bought cigarettes from them. The City is now sending out collection letters, seeking payment from the buyers, and they claim to have collected some $700,000 so far.
Another tax dodge up in smoke, so to say.