Cigarette Smuggling

Mar 6, 2013

Over the last few weeks, Governor McDonnell has been scrutinizing 812 bills sent to him by the General Assembly.  Among them is a package of legislation to penalize “possession with the intent to distribute” a legal product.  Its goal is to stop the traffickers of contraband cigarettes, who’ve made millions of dollars while the Commonwealth loses revenue.

"People may ask, 'Well, why do we care?' But the fact of the matter is it is bringing in organized crime and ties to terrorism," said Howell.

Whether through “smurfing”—or legal purchases for sale elsewhere—counterfeit tax stamps, selling “off the books,” or phony retail stores, the profits for re-selling Virginia cigarettes in high tobacco-tax states are surging.  Senator Janet Howell is the bills’ chief sponsor.

“We have a major problem because our tax is only 30 cents a pack and New York City is over six dollars a pack.  So it’s very advantageous for smugglers to get involved in cigarette trafficking.  The profits are huge—they’re bigger than drugs.”

In fact, one truckload of 800 cases of cigarettes yields a four million-dollar profit.  Howell says the bills make it a felony to possess 500 or more cartons with the intent to distribute them. They impose tough penalties for selling unstamped or counterfeit cigarettes—and for receiving unstamped products.

Trafficking also becomes a crime under state racketeering laws.