ALBANY, NEW YORK – Frustrated by the Pataki administration’s refusal to collect cigarette excise taxes from sales by Indian retailers to non-Indians, a bipartisan group of New York state lawmakers has introduced a measure that would take away the governor’s tax collection power and “make it more a matter for law enforcement,” reports the Buffalo News.

“State legislators might have found a more potent way to force Indian retailers to halt the sale of tax-free cigarettes: Make it illegal for tobacco manufacturers to do business with wholesalers that don't charge taxes on cigarettes supplied to Indian merchants,” writes the newspaper.

According to state lawmakers, adds the newspaper, the state’s failure to collect the $1.50 per pack cigarette excise tax from Indian retailers “costs the state $400 million a year.”

“It's a very easy way to fix this problem at long last,” Assemblyman Alexander Grannis, (D-Manhattan) told the newspaper, who for years has been urging the governor to collect Indian tobacco taxes.

New York state law says that on March 1, the New York Department of Taxation and Finance was to begin collecting cigarette excise taxes from Indian retailers; however, Gov. George Pataki (R) is maintaining his 10-year refusal to begin the tax collection process.

Grannis commented that the proposed measure would place cigarette manufacturers who violate state law “in the cross hairs” of local prosecutors and the state attorney general’s office.

The newspaper writes that supporters of the bill say it has a good chance of passing before the session ends in June because of the legislature’s “insistence over the years that the tax be collected.”

Jim Calvin, executive director of the New York Association of Convenience Stores (NYACS), told the newspaper NYACS members are open to a “creative approach” to ending the administration’s refusal to collect cigarette excise taxes from Indian retailers. 

“It's just unfortunate that something like this needs to be considered when the easiest, most direct, best answer to this situation is for the governor to enforce the existing law,” Calvin said.