New York May Try Collecting Cigarette Taxes from Native Americans

New York lawmakers are considering collecting unpaid taxes on cigarettes sold by Native American tribes to non-Indians as a way to help address the state’s budget deficit, the Associated Press reported Oct. 27.

At an upcoming budget meeting in Manhattan, officials will look at the benefits of the potential tax revenue as well as hear concerns about collecting the taxes, including the possibility that doing trying to do so would lead to violent confrontations between the state and the tribes, as it did in the 1990s.

Lawmakers, tobacco companies and anti-smoking activists say $400 million or more in revenue could be collected from the tribes.

Tribes such as the Seneca Indian Nation argue that they are protected from taxation under treaties signed back in 1794. The tribes also say their sales provide millions in revenue that directly benefit local communities.
 
Tobacco companies such as Altria say enforcing the law will help prevent their products from being sold illegally, as well as counterfeiting.

“The failure to collect the tax is a major public-health problem,” said Russ Sciandra, head of the Center for a Tobacco Free New York. “There are thousands of people who would quit smoking if they had to pay full price.”