High-tech tobacco tax stamps: New technologies for fighting counterfeiting and tax evasion
Tuesday, November 5, 2013
Nearly all states collect taxes on all kinds of tobacco products. When a designated vendor has paid the state excise tax on a pack of cigarettes, in many states, each one receives a stamp from the state as evidence that the state excise tax has been paid. Tax stamps have been required as long as states first started to impose taxes on tobacco products, much like stamps are required for other products and activities that the states regulate, like alcohol sales and hunting. Currently, 47 states, DC require tax stamps to be affixed to a pack of cigarettes. It is illegal in these states to sell cigarettes without a tax stamp. As excise taxes have increased on tobacco products in the last decade, it's become increasingly lucrative for organized crime to counterfeit tax stamps, attempt to sell cigarettes from lower-tax states in higher ones, or attempt to sell unstamped cigarettes altogether. The majority of states are using outdated stamping methods that have little to no protection from counterfeiting. States lose millions of dollars of revenue each year because of this. To combat this, California introduced a new counterfeit-resistant tax stamp in 2005 leading to an additional $120 million in state revenue without increasing the excise tax. Since then three other states have followed California's lead in combating tobacco tax evasion by introducing their own versions of counterfeit-resistant tax stamps. This presentation will explain how counterfeit-resistant tax stamps work, and explore whether these increased measures to combat tax evasion are cost-effective.
Advocacy for health and health education
Public health or related organizational policy, standards, or other guidelines
Public health or related public policy
List different types of tax stamps.
Describe what a high-tech tax stamp is.
Explain what different types of tax stamps are used.
Assess the policy implications of tax collection and anti-counterfeiting high-tech tax stamps can offer.
Keyword(s): Legislative, Tobacco Control
Presenting author's disclosure statement:
Qualified on the content I am responsible for because: Ryan Patrick is a Senior Legislative Analyst and Manager for The MayaTech Corporationâs Center for Health Policy and Legislative Analysis. His specialties include state level tobacco, cancer, and obesity policy analysis. He received his B.A. in History from DePauw University, and his J.D. from Barry Universityâs Dwayne O. Andreas School of Law.
Any relevant financial relationships? No
I agree to comply with the American Public Health Association Conflict of Interest and Commercial Support Guidelines,
and to disclose to the participants any off-label or experimental uses of a commercial product or service discussed
in my presentation.