OK, think like a government bureaucrat:
NEW YORK - The big cigarette tax increases that many states are instituting to balance their out-of-whack budgets are raising fears that the trend will make black-market smokes more profitable and lead to more cigarette smuggling.
Cigarette smuggling has been going on for generations and already costs states untold billions in lost tax revenue.
Criminal gangs stock up in low-tax states like Virginia and Missouri, truck the cigarettes north and illegally resell them in high-tax states like Michigan and New Jersey. Other buy cartons and cartons of tax-free smokes on Indian reservations and sell them elsewhere. Buyers order untaxed cartons of murky origin on the Internet. And ships arrive from China carrying cargo containers filled with counterfeit cigarettes.
So. If the state raises the sales tax by 16+ percent, and I live on the border of a surrounding state with a lower sales tax and go to that state to save money on a big-ticket item, I am a smart consumer, and there will be endless debates about how smart it was for the state to raise the sales tax. But if the state raises the taxes on cigarettes, and I see an opportunity to cross the border to buy cheap and sell dear, I am a smuggling criminal.
Boy. We don't even have to get to state-sponsored gambling to talk about how Indiana gave up any pretense to the moral high ground.
