Cigarette Tax On Ny Reservations

12.16.08 | Dee Haley

The last time a New York governor signed a bill to tax the sale of cigarettes on Indian property, tire fires were set in protest along Interstate 86. Now that Governor David Paterson has signed a similar bill, many residents in Western New York are wondering if they are in for more protests.

Manufacturers are now required by law to put a tax stamp on any pack of cigarettes that are sold to wholesalers of New York tribes. That is, unless the the wholesaler certifies the cigarettes will not be sold tax free. It is a move that shifts the collection of taxes from reservations to the manufacturers, and it is a tactic that has worked well in other states.

Convenience stores have argued it is not fair that the Indian tribes do not have to charge the taxes. However, the tribes say they are protected under a treaty that is two hundreds years old. If they do not charge the tax, they could have their licenses revoked.