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Sin taxes deadlier than vices
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Death and taxes.

They are supposedly the only two things in life that are inevitable.

Eric Garner found out the hard way that death and taxes can also be one in the same.

Garner was the Staten Island resident who was killed after he was put into a chokehold by New York Police officers on July 17, 2014.

Officers suspected him of selling "loosies." That's what black market cigarettes are called in the Big Apple where there is a thriving demand for smokes that avoid a draconian cigarette tax.

The health-conscious politicians of New York believed if they imposed punitive taxes on things such as soda and cigarettes that people will stop using them. As a result, New York State has the highest cigarette tax in the nation at $4.35 a pack. That's not all. New York City slaps on another $1.50 a pack bringing the tax on a pack of cigarettes to $5.85. That pushes the cost of a pack of cigarettes at New York City stores past the $12 mark. That's roughly three times what you would pay for cigarettes in California.

Compare that to California where taxes are at 87 cents a pack and is ranked as the 33rd highest cigarette tax in the country.

So has the draconian New York cigarette taxes reduced smoking? The jury is still out on that one but one thing is clear - tax-happy state and city politicians helped create a booming black market for cigarettes. The non-profit Tax Foundation estimates 58 percent of all cigarettes sold in New York are illegally brought in from other states and resold on the street to avoid the $5.85 per pack tax.

Politicians who claim they only imposed stiff taxes to save people's lives are miffed that they are losing out on tons of taxes. So in the name of money and not health they unleash the prosecutorial powers of government.

Having police comb the streets for alleged sellers of black market cigarettes has become a high priority given the taxes that government is losing.

It is why New York State is suing United Parcel Service over the alleged shipping of 700,000 cartons of cigarettes to addresses within the Empire State between 2010 and 2014. The state alleges UPS delivering out-of-state cigarettes over five years cost them $29.7 million in tax revenue or 0.03 percent of the annual budget. (Note budget percentages listed are for five years and not one.) New York City contends it has lost $4.7 million in taxes during the same time period or the equivalent of 0.006 percent of its annual budget.

UPS correctly points out that they do not open and inspect packages that they are paid to pick up and deliver. That doesn't matter to the government; they want their money. And if they can get five times the amount of money they lost by shaking down UPS that's all the better.

It is clear that there is a level at which punitive taxation creates a lucrative black market. Making it worse is that in a number of cases, many of the receipts from today's black markets fund terrorism.

The Washington Post has cited a number of instances where the federal government has found this to be true.

It's kind of ironic that draconian taxes imposed by politicians in a misplaced sense of duty to discourage people from partaking in activities that may prove harmful to them are unwittingly financing efforts by terrorists to kill Americans.

Tax something enough and you will make the rewards appealing to people to break the law to sell it on the black market.

It is why justifying the universal use of marijuana by adults in California by saying it will generate taxes and reduce crime is just plain wrong.

The assumption is no black market will develop.

A 10 percent tax coupled with the legal barriers being dropped would be more than enough incentive to sell marijuana without a resale license or collecting taxes.

That means marijuana sellers breaking drug laws would be transformed into marijuana sellers breaking the tax laws.

And we all know how harshly the government treats those who deliberately avoid taxes without first "bribing" elected officials in the form of campaign contributions to secure tax credits or tax exemptions.

Taxation - or enforcement thereof - can prove more deadly than the vice that is targeted.

If you doubt that's the case just ask the family of Eric Garner.

This column is the opinion of Dennis Wyatt and does not necessarily represent the opinion of Morris Newspaper Corp. of CA.


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