• March 3, 2024

‘Tax Hike Will Kill Jobs and Boost Smuggling’

 ‘Tax Hike Will Kill Jobs and Boost Smuggling’
Photo: Tobacco Reporter archive

New York’s cigarette smuggling problem will get even worse if the state implements an additional levy of $1, as Governor Kathy Hochul envisions, according to a Wall Street Journal article. 

The WSJ reports that more cigarettes are smoked in New York than are legally bought, suggesting considerable levels of tax evasion and avoidance. New York imposes a statewide pack tax of $4.35 per pack. New York City imposes an additional $1.50 per-pack excise tax.

Union workers have expressed discontent with the planned ban and tax hike. “Our union brothers and sisters in the tobacco industry are at risk of losing their jobs, benefits and pensions due to Governor Hochul’s proposed ban on menthol/flavored tobacco and tax hike,” Mike Smith, president of Local 810 International Brotherhood of Teamsters, said. According to Smith, 500 out of 4,000 drivers, warehouse workers and salespeople represented by Local 810 would lose their jobs if the ban is approved.

“While we understand the intent of the legislation is not to eliminate Teamster jobs or destabilize Teamster pension funds, the unfortunate reality is that those will be certain results,” Thomas Gesualdi, president of the Teamsters’ Joint Council No. 16 representing 25 locals and 120,000 members, said in a letter to Hochul early in February.

“I understand the impetus of the policy is to get people to stop smoking, which is a good thing,” Assembly Majority Leader Crystal Peoples-Stokes said. “But I think it shouldn’t be this selective. It goes way too deep … and would be a mistake, so I will be working to have it excluded.”