Government seizes untaxed cigarettes in Minnesota

Authorities seized thousands of untaxed cartons of cigarettes across the state recently, the Minnesota Department of Revenue announced Monday.

Nearly 10,300 cartons containing 2 million cigarettes were seized by state and federal authorities between May 2009 and June 2010. Most of the cigarettes were sold by American websites but manufactured in Ukraine. In many cases, cigarettes sold over the Internet are counterfeit and often made in unsanitary facilities.

State law requires that payment of the tax imposed on each pack of cigarettes must be verified with a corresponding value of stamps attached to each package. None of the cigarette packs in the cartons seized had the proper stamps.

The unpaid state tax on the cigarettes is approximately $159,000 with an additional unpaid federal tax of $104,000.

Possession of untaxed cigarettes may result in criminal penalty for the buyer. Purchasing untaxed cigarettes from an unlicensed seller may result in criminal penalties for the reseller. Penalties range from misdemeanors to felonies and buyers would be subject to tax, penalty and interest.

The Department of Revenue said Minnesotans who purchase untaxed products that are shipped into the state must report the cigarette and tobacco taxes on tax return forms that can be found on the agency’s website. Cigarette and tobacco taxes not paid by the 18th of the month following the month of purchase are subject to interest and penalty.

source: bizjournals.com

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