CBS New York: AG Schneiderman Sues Online Tobacco Sites
(February 3, 2011)
MINEOLA, N.Y. (AP/CBS New York) – Six website operators are violating a state law that bans the online sale of tobacco to customers in New York, Attorney General Eric Schneiderman said Thursday.
Schneiderman said lawsuits were filed a day earlier in state Supreme Court in Manhattan, seeking $5,000 in fines for each violation, as well as an injunction barring the companies from future sales. The lawsuits cite 11 violations, but the attorney general said his goal wasn’t to collect fines, but to stop the shipments.
New York is one of six states, according to Schneiderman, that prohibits tobacco dealers from selling their products over the Internet; Connecticut, Maryland, Ohio, Vermont, and Washington are the others. New York’s law requires anyone receiving cigarette shipments to be a licensed cigarette tax agent or wholesale dealer.
“As one of my colleagues said recently, the Internet really is the crime scene of the 21st century,” Schneiderman said. He called Internet cigarette sales “one of the primary methods of evasion of every effort we’re making in the state of New York and in the country to reduce the national tragedy of tobacco addiction.”
The lawsuits were filed the same day the New York City Council banned smoking in city parks, beaches and even Times Square. The village of Great Neck, on Long Island, also recently banned smoking on public sidewalks.
Telephone messages and e-mail requests for comment from the companies, some of which are based in Europe, were not immediately returned Thursday.
Schneiderman and others contend that because the websites have lax standards for age verification, the sale of cigarettes — usually cheaper because no sales tax is collected — is attractive to underage smokers who may be stymied in purchasing cigarettes at retail outlets. In New York, the sales tax on a single pack of cigarettes is $4.35 — about half of the total cost to customers.
He cited statistics from the Centers for Disease Control and Prevention that 24,100 children under the age of 18 become new daily smokers each year.
“When cheap untaxed cigarettes are made available, more kids will try them and more will become addicted,” said Michael Seilback, a spokesman for the American Lung Association. “We know that a high cigarette price is the single largest deterrent to kids starting to smoke and getting adults to quit. The high price on cigarettes is a critical component of a comprehensive tobacco control program.”
Schneiderman also noted that most of the Internet tobacco transactions do not include the collection of sales tax. The state Health Department found in 2004, between $106 million and $122 million in sales tax revenue from online cigarette sales went uncollected.