Missouri's low tax on cigarettes is encouraging lawlessness.
At 17 cents a pack, Missouri's tobacco tax is the most smoker-friendly in the nation, cheaper even than in states that have cigarettes named for them.
For people with rudimentary math skills and access to trucking equipment, the 17-cent tax presents an opportunity. Ghalib Shahjamaluddin is (allegedly) such a person. Federal authorities say he transported 29 million cigarettes from Missouri to Illinois, taking advantage of the 81-cents-a-pack difference in the states' excise taxes.
Shahjamaluddin's business model is being called a "smuggling operation," which seems a bit much when you consider the ease with which motorized transportation passes between the two states. If he used a water vessel of some kind, well, yeah, we could call that smuggling. But I-270?
Shahjamaluddin lives in St. Louis and supposedly ran his merchandise to Chicago. There may not be anyone in this area who handles his volume, by virtue of the fact that Kansas is so sparsely populated. The cost per mile and risk of incarceration make "smuggling" Missouri cigarettes into Kansas seem like an activity that should be limited to Johnson County residents who buy their personal supply of Camel Lights at the midtown Costco.
A federal grand jury has indicted Shahjamaluddin on four counts of illegally possessing, shipping, transporting and distributing contraband cigarettes. He may be thinking what 29 million cigarettes buys in prison.
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I say there is no illegal activity here. All it says is Missouri is loosing out on tax money. The cigs were purchased legally paying the existing MO tax.
The guy should go free.
Sounds like a really stupid MO legislature.
Stupid is as stupid does.
I remember reading an article a few years ago about smugglers who ran I-95 from NYC to Virginia once a week to buy truckloads of Newports to sell in the city. I don't remember the numbers exactly, but there was something like a $6 profit PER PACK. Tax stamp abuse was so bad that the city hired people just to go to newsstands and make sure NYC taxes were paid on all tobacco products.
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