Wyoming black market troubles


RIVERTON -- Higher state tobacco taxes imposed 16 months ago have contributed to increased black market trading of cigarettes in Wyoming, a state tax official said.

"We recently seized 2,000 cartons of contraband cigarettes that had come into Wyoming and were about to be sold without the required Wyoming stamp," Dan Noble, head of the excise tax division of Wyoming Department of Revenue, said.

The 2003 Wyoming Legislature raised the excise tax on a pack of cigarettes from 12 cents to 60 cents. The higher tax took effect July 1, 2003.



Noble said recently that his agency may revoke two or three wholesale tobacco licensees because of violations of state law.

Noble said sale of untaxed cigarettes over the Internet is another threat to the $15 to $20 million in revenue the state receives from taxes on the sale of tobacco products.

Some vendors are blatantly advertising sale of cigarettes over the Internet, avowing that sales are made without applying taxes. And some American Indian tribes are advertising untaxed tobacco products for sale.

Noble said outlets on the Wind River Indian Reservation in Wyoming try to estimate cigarette sales to non-Indians and pay taxes on those sales.

The state revenue department recently conducted simultaneous inspections of 11 tobacco wholesalers. In one site, cigarettes were found with Colorado, rather than Wyoming stamps.

Tom Jones, lobbyist for the tobacco wholesalers, said most wholesale tobacco businesses are family-owned and run, investing heavily in stamp application equipment and abiding by all the laws.

Noble said his agency has chosen not to publicize wholesalers found in violation of state law.