Native American entrepreneurs, looking to take their tax-free cigarette trade to a new level, have discovered the benefits of no longer being just one link in the tobacco chain.
In a couple years, some of these Indian business interests have found the benefits of not just being the retailer, but also the maker, of cigarettes.
Leading the way is the Seneca brand, owned by Seneca businessman Arthur Montour Jr., and made on an Indian reservation in Ontario. There also is a network of Indian tribes throughout the nation to help distribute the tobacco everywhere from casinos to the Internet.
Health groups, however, are raising the cautionary flag. For starters, some of the cigarettes do not meet regulations for so-called fire safe cigarettes, which self-extinguish after a certain period of time to cut down on smoking-related fires. Also, Roswell Park Cancer Institute has found some higher-than-usual chemical elements in some of the cigarettes, raising questions about the already dangerous practice of smoking.
The booming sales have caught the eye of law enforcement agencies, some of which have moved in court to try to halt the trade. They claim the sales are illegal for a variety of reasons -- not the least of which is they are being sold tax-free.
Not surprisingly, so close to the beginning of the trade start point, Western New York smokers are especially attracted to these cheap smokes. The Seneca brand, for instance, two years ago attracted just 0.2 percent of adult smokers in the region. In 2008, according to Roswell Park, 10.3 percent said it was their usual smoke.
At issue for the state, besides what critics say are the health implications of more smokers being encouraged to keep smoking with the cheaper cigarettes, are the lost tax revenues. For Gov. David A. Paterson, the explosion of Indian-produced cigarettes represents yet another complication as he becomes the fourth governor to try to resolve the tax collection dispute.
-- Tom Precious
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