Tobacco Documents Online

WH© LES~ ~.~~. ~~~ ~~LE T~ . ~~. ~~ . . = ~~~O DISTPIaIJTaPS ~r NEW VO(~K I~lc. , ORGANIZED INi 1935 211 EIAI'ST 4'3uD STR'EET, hT`B' YOR'K. N. H. 10,017 212 6~82-3576' TIIE' DAILY NEWS' Thursday, May 19, 1971 CigTax:. '.. _-osses, Vfed4l ' c Sine the 'Legislatuxe. ;raisedi •igaret taxes from 5 to 10 cents' iA; years -ago, legitimate saless iave, declined by 1.7 billion, paci:s„ tiiorriq1'Weinraub, managing di- -eLtor' of the Wholesale Tobazco )istributors of New York re- )orted yesterday. - "The total loss to New. York. ;tate in tax' revenues has been .pproximately $183 million, and o New York City $46 million; " e toTd' the Eastern regional con- erence of the National Tobacco Ralph Salerno Hit 'sm in poclFstbook, he; iays f.. . Crime ExDertI 11 . Urges V/ar1 on . Hoods in. BizWILLIAM P'R'OCTOR' The state tobacco industry hould stop playing, "hops and ', obbers" with, organized crime's i igaret smuggling operations and ' nstead should launch an attack m the underworld's complex narketing system, crime expert l talph Salerno told the Easterni+ tegional Conference of' the Na- innal Tax Association vesterdav:,` Tax. Association at the City Squire 14lotorInn. ' This' does not include sales ~ tax losses, estimated at another ~ $40 million for the five-year peri+ ' odj"' he ad'ded. Weinraub charged thatl cigaret; bootleggers are "waxing rich and' : fat on illegal profits." The Legislature is considr?ring ¢t another cigaret tax boost of G'' cents a pack through the state and an additional 4 cents' in New • Kork Cit~. j. THE' DAILY' NEWS May 2IJ'„ 1971 `• Sal'erno e',a l l e d for a"co- ordinated, effartf1~ in the cigaret, trucking and investment fields to combat the infiltratioa of' organized crime into the business world. "Cllever Businessmen" "You're dealh'ng' with organized criminals, and the only way to address'them is to get organized," Salerno declared. "These are ' clever ~: businessmen w h a are making' it impossible for govern- me ~ to condi~ct its business of , aolectiiig taxes in a regular way."' Sal.'erno urged his listeners to "learn fie new, math o£ organiz,ed crime"-the way the`underwirldl contributes to the necessity-14ar higher taxes by failing to . pay l, taxes on millions if' dollars of ~ smuggled cigarets and otfier .J~ products. . r u1i A Pat for OTB' ~ As an example ofl a way to at- tack organized c r i m e where it hurts - in the pocketboik-Sal- erno cited the city's successful % Off-Track Betting Corp. as "the 1/j most realistic threat to organized k crime to come dbwn, the road i .-~n years." _4. In an effort to make cigaret 1 smuggling ]ess profitab]e; the tax ~ assiition delegates passed a ` resolution calling for a uniform tax rate across the country. NEGT YORK' T TME S TUESDAY, MAY 18', 1971 N~IiFORMITY ASKED'; ON CIGARETTE ThX~'' Tobaraco Group, Seeking,Ehd ~'of:Smuggliny Probierrr` I . I B;p Il.INDA CPIARLTON : ~he men concerned' with try. frtg to collect tobacco taxes ln selreral Northeastern states en- dorsed again yesterday an old'd so}ution'to the problem of ciga- rette smuggling: The lmposition4 one wray, or another, of' a.-na- Rionali~+ uniform tax. 3he thcee-day Eastern iregion- al' :meeting, of' the National' To~ bacco. Tax' Association, ' which opbned' yesterdAy, is devoting most' of its agenda, to discus- sions of smuggling of cigaretites from_ low-tax states such. as Northr Carolina into hiRh-ta~t st~tes such'es New York and. Pennsylvania: Two speeches during the aft- ernoon session dealt with the unlform'tax rate eoncei2t. Since 1983, there havee been oCca'sion- al' 'attempt's at Federal legis-~ latlon that would i implerrient,the conce t, but none has suc-, ceede~, and the consensus yes+ terda y~ was that the prosps-ctswepe Tittle'bri'ghter now. Proposal'Appears Dootned "'UVho would have the temer- lty?" asked J~ahn Cooney of' 1Vlaryland,'to •propose such an uno'ertaking to his State Legis- latltre. "I'm da.rnned 1 if' I would, ," he.,addeil. "Iid be run out." . ~.. ., The'Advisory Cbummission on I Inthrgotternmentai Relations, rej,~cted the notion of a uniform , mte in, 1964, notedi thatl "teKx rate differences reflect I iations in state~ tax~ ph~ilos~o.~ ! h6es" and called "the preser-, I vadon>~ of' Interstate rate differ- ' enCes"=which now range from 2 ts-to 18 cents a package- '"a e~senRnal objective." ut ~atrick Marangel4 assist- ant dk,ector -off the audit -divi- sio4t' of the Connecticut Tax artment, disagreed, saying, e answer to cigarette smug- gling ia tfte•eli'rni'nation of com- ' petition, between the states." I Mr. MaTaingell's suggestions loe mett~ods 'by' which this coikld be done were . either a Federal-taxcredit system or the collection of a single tax by the states "with reimbursement made perriodically to the Fed- eral Governxnent " Regional Plan'Offered Albert B. Baytel' of New Jer- sey proposed an attempt to set a uniform tax rate within re- gions, If not nationally. "The rprdblems of collections and en- forcement would' be mini- mized," he said, by such a regional rate. At present, within whatl is considered' to be the Eastern "gion; tlie rate varies from 2'~/ eents a pack in Vir- ginla to 18 cents in Pennsyl- vania: The lowest tax rate In the United States Is North CarQ- lina`s -2'-cent levy; which was enacted' partly ini response to pressure from high-tax states. The Federal tax, 8 cents' aI packa e, is collected from the •• manufacturers. Each state collects its tax onl'y, on those cigarettes sold or usedi within its borders. Thus, Northi Carolina, in, ad'd[tlon to the in- come generat'ed, by the nation- v+i.is. cel'n nf hnHenrnnrrviS.rtc