Tennessee to step up surveillance of cigarette smugglers

Anyone trying to skirt the state’s puffed up cigarette tax and transport smokes back into Tennessee may want to watch out for the Department of Revenue.

The Department’s Special Investigations Section will be conducting surveillance on tobacco retailers located just outside the state lines to watch for Tennesseans purchasing cigarettes in bulk and then transporting them back to Tennessee, revenue announced today.

Earlier this year, the state Legislature, at the calling of Gov. Phil Bredesen, more than tripled the state’s cigarette tax from 20 cents to 62 cents per pack.

“As a result of this legislation, Tennesseans may travel to neighboring states to purchase cigarettes in order to avoid paying Tennessee cigarette tax,” said Reagan Farr, the commissioner of the Department of Revenue, in a statement. “Tennesseans should know that the law requires cigarettes purchased outside of the state to bear a Tennessee tobacco stamp, otherwise the cigarettes may be considered contraband.”

The stepped up surveillance comes as the state’s estimates for cigarette tax revenue has not met expectations.

July cigarette tax revenues, the first month of enforcement, were about $14 million less than the state estimated.

The Bredesen administration had estimated the 42-cent tax increase would take in about $230 million annually.

Tennessee smokers living near the border are likely tempted to travel to state’s with lesser cigarette taxes. All eight states around Tennessee have cheaper cigarette taxes.

Mississippi’s is the lowest at 18-cents all the way up to Arkansas at 59-cents a pack. Kentucky’s tax is 30-cents, according to the Campaign for Tobacco Free Kids.

A person possessing two cartons of cigarettes that do not have state revenue stamps is a misdemeanor. The vehicles used transporting the contraband smokes can be seized as well.

A person who has more than 25 cartons of cigarettes lacking revenue stamps is a Class E felony.

“If revenue agents believe that an individual is transporting more than two cartons of cigarettes into Tennessee, the vehicle carrying the cigarettes will be stopped and searched,” Farr said. “If more than two cartons are found, the cigarettes will be seized and agents have the discretion to make arrests and seize the vehicle.”