An Iowa business group is urging Iowa’s two U.S. Senators to support a bill which seeks to limit Internet sales of cigarettes and other tobacco products. Iowa Wholesales Distributors Association executive director Craig Schoenfeld.
“We encourage Iowans to get on board and support this legislation and communicate that to Senators Grassley and Harkin,” Schoenfeld says. “We think this is a great step in regulating this particular product, as well as being able to capture lost revenues for the state.” On-line sales of cigarettes have skyrocketed in recent years.
Schoenfeld says that means legitimate tobacco retailers are at a competitive disadvantage with those who sell cigarettes, cigars and other tobacco products online. “These are operators that tend to avoid excise taxes — both federal and state,” Schoenfeld says. “And given the national economic climate, the climate here in Iowa, those additional revenues would be welcomed, to say the least.”
The state tax on a pack of cigarettes is a $1.36. The federal tax is $1.01 per pack. Schoenfeld says minors are often able to buy cigarettes online, and that’s another reason for the crackdown. “It’s a way to get a hold of contraband cigarettes which are, basically, sold over the Internet,” Schoenfeld says. The bill Schoenfeld’s group backs cleared the U.S. House in May and all five Iowa congressmen voted for it.
The Senate Judiciary Committee approved the “Prevent All Cigarette Trafficking Act” last week and Senator Grassley, who is a member of that committee, voted for it. The bill increases the penalty for those caught selling tobacco products online illegally. Some supporters of the bill say criminal syndicates and terrorists are profitting handsomely from cigarette smuggling operations.