Last month The New Yorker published a funny story about a retail tobacco outlet on Staten Island and the Lower East Side that's been exploiting a perceived loophole in the city's cigarette tax law. At Island Tobacco, customers can get a pack of smokes that normally cost $13 for just $6—or less. The store does this by requiring smokers to roll their own coffin nails using on-site cigarette stuffing machines. Island Tobacco's owners contend that this allows them to sell products as loose tobacco, which is taxed at a lower rate. But the city begs to differ, and the law department is going after the company!
"They are trying to get around the law by claiming they’re not in the business of selling cigarettes when they clearly are," Mayor Bloomberg said in a statement. "Most businesses abide by the law, play by the rules and pay their taxes. We are not going to allow some businesses to skirt the law and we will ensure the playing field is level. They are cheating other businesses out of customers and attempting to illegally dilute one of our strongest smoking deterrents."
A lawyer for the company tells the Times, "We are not producing cigarettes for resale. We are selling the contents that produce the cigarette, and it’s up to the user to make them." But a representative of the city has this analogy: "When you go to a salad bar, they sell you a salad, not a salad assembly process. When customers walk out of these stores, they have finished cigarettes and they bought them in those stores. The stores also have signage that calls them a discount cigarettes shop."
A couple of the stores' ads are included as evidence in the city's filing, which you can peruse below. The lawsuit against seeks an injunction to stop the company from continuing their illegal sale, distribution, and advertising of non-taxed cigarettes, as well as compensation for the tax revenue lost by the city. We asked local smokers' rights advocate Audrey Silk what she thinks of the lawsuit, and she has this to say:
The city's lawsuit says, “By selling illegally low-priced cigarettes defendants not only interfere with the collection of city cigarette taxes, they also impair the city’s smoking cessation programs..."
Imagine one of the presidential candidates making such an at-odds remark during a debate. They'd be roasted by the media. But not Bloomberg or any of the other Prohibitionists. No, they get a free pass to say, in the same breath, that they want the money but don't want people to buy the product.
It's both laughable and ugly. They are actually saying they need people to smoke for their money while whipping them for their charity to the city at the same time. Civil societies don't do that.