Economist magazine reports:
THE busy interstate highway that zips through Richmond, Virginia, and up to the crowded cities of the north-east has long been a conduit for handguns bought wholesale in Virginia and sold to drug-dealers in New York. Now I-95 is siphoning northwards another form of contraband: black-market cigarettes.
Because Virginia’s tobacco tax is the second-lowest in America, gangsters buy cigarettes there in bulk and sell them at enormous profit in New York and other high-tax states. At a minimum, they pocket a big chunk of the difference between what Virginia adds in tax—30 cents a packet—and the higher rates imposed elsewhere. New York’s tax, at $4.35 a packet, is the highest in the country.
The federal Bureau of Alcohol, Tobacco, Firearms and Explosives estimates that sales of illegal cigarettes cost government—local, state and federal—nearly $10 billion a year...
The growth of the cigarette-resale racket, known to police as “smurfing”, appears tied to a growing government appetite for cash. Since 2007 at least 27 states have raised their cigarette taxes, often to erase deficits or to cover sharp increases in health-care costs. This spurs the smugglers on. In New Jersey, where a packet of cigarettes carries a tax of $2.70, about 40% of all cigarettes are smuggled in from other states, according to the New Jersey Treasury Department. Maryland, Virginia’s neighbour to the north, reported a fourfold increase in seizures of illegal cigarettes between 2010 and 2012, though one official described the haul as the tip of the iceberg.Moreover, the penalty for doing it—a maximum of five years in jail, under federal law—is considerably lighter than for selling drugs. If the smugglers were trafficking in heroin, they would face life in prison.
Note well: Economist is an establishment mag, if there ever was one. Note the use of the words "gangster" and "racket" for those attempting to provide cigarettes at a reasonable price. What's going on here is Economist is likely launching an early seeding amongst second-hand promoters of government authoritarian ideas. The power operators want greater legal penalties for those selling non-taxed cigarettes. As the second hand dealers get "educated" about the "evils" of non-taxed cigarettes, they will soon be out with the opinion pieces calling for higher prison terms for dealers in non-taxed cigarettes.
Bottom line: Black market non-taxed cigarette dealers are on the radar of big government.