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LONG ARM OF THE LAW

Oregon bills individual smokers for state tobacco tax bills!

Los Angeles, January 5 – Big Brother is alive and well in the state of Oregon as the business tax division of the Oregon Department of Revenue is now sending bills to individual in-state smokers who have not paid the state’s tobacco tax on cigarettes.

Happily, cigars are exempted, at least for now.

Typical of states which are searching for revenue from every source imaginable, Oregon is trying to more strongly enforce their collection of state tobacco taxes. At issue are cigarettes purchased from on-line or mail-order merchants from outside the state.

A lengthy story in Monday’s editions of The Oregonian quoted the state’s administrator for the Department of Revenue, Randy Evers: “This is the tip of the iceberg. We’re just getting started.”

Based on lists of customers provided under law by on-line retailers to the Department of Revenue, the state has sent bills for unpaid tobacco taxes to 15 individuals with another 60 to follow according to the story.

All together, the amount sought to be collected total $15,000, with a low of $11.80 and a high of about $2,000.

Federal laws have required sellers of cigarettes – specifically defined as a roll of tobacco covered with paper or any substance other than tobacco – to pay state cigarette taxes since 1949. But the action comes under a 1965 Oregon statue (now Oregon Revised Statutes, sec. 323.060(2)) which requires that “Any taxes resulting from a distribution of cigarettes for personal use or consumption in a quantity of more than 199 cigarettes shall be paid by the user or consumer.”

All the Oregon revenue collector care about is money. Kevin Neely from the Oregon Attorney General’s Office told The Oregonian, “The American Cancer Society is going to tell you that if taxes are raised high enough, people will quit smoking.

“What I’m going to tell you is I don’t care. These Internet companies are stealing money from the state. And our job is to stop them. This is a criminal issue for us.”

The Federal law – known as the Jenkins Act – and the Oregon state laws involved in this case very clearly define cigarettes in a way which leaves out traditional cigars in all sizes larger than a cigarillo. While the Federal language is clear as noted above, Oregon’s law could be twisted to include little cigars which use homogenized tobacco leaf wrappers instead of paper such as Captain Black, Winchester and others. It includes a definition which mirrors the Federal language, but adds a section which classifies as cigarettes anything which is perceived in the marketplace to “be” a cigarette.

Ultimately, this kind of heavy-handed approach could be the catalyst for bringing smoker’s rights to the fore. We may be reaching the point where the funding of state programs on the backs of 15-25% of a state’s population is correctly perceived as punitive and unfair.

From the Cubador:
Monday marked the 44th anniversary of the breaking of diplomatic relations with Cuba by the United States government. President John F. Kennedy authorized the action in 1961 and a year later, imposed the broad embargo which continues today. Contrary to popular belief, Kennedy’s 1962 action on the trade embargo extended an initial, but only partial embargo begun by his predecessor, Dwight Eisenhower, in October 1960.

In February 1963, Kennedy prohibited travel to Cuba and made commercial transactions with Cuba illegal. And with some movement back and forth over the years, that’s where we are today.

Hammer Time I:
It’s been a seller’s market in one of our favorite collectibles, the cigar jar. The latest big sale came on New Year’s Day, when a hard-to-find jar from Cuba’s H. Upmann factory made for Benson & Hedges (London) was auctioned for $371.00 after bidding opened at just $125.

The auction capped a big year for jars, with nearly all of the top collectible jars available and prices for Partagas and Ramon Allones “Sevilla Humijars” approaching $700 and a mint Partagas bakelite jar from the 1920s topping $800.

Unseen in 2004: the rare 1920s Partagas ceramic jar with blue lettering from Tavalera in Spain or an H. Upmann original, glass “office jar” from the 1910s or 1920s. Let’s hope we see them in 2005.

Hammer Time II:
Currently up on eBay is a complete Padron Millennium humidor with 100 Padron 1964 Anniversary Series cigars in an elegant box. Only 1,000 were produced and this edition shows modest effects of aging with clearly-visible cedar sap on the underside of the lid.

The price? Bidding starts at $3,060 and the auction will end tonight at 7:15 p.m. Pacific time.
~ Rich Perelman

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