Disturbing Post

[smokingclam]

Was reading posts on a snuff forum when I found this disturbing post....Snuffhouse.org - Shipping from UK to US

Seems Mastercard and Visa may not be allowing tobacco purchases from the UK to the Us to be allowed. This may be worth following.

If I can't get my snus from over there I may become one mean SOB in weeks to come.

[Elwin]

Clam,

I get my snuff from Nicotine Rush here in the states. He carries a pretty good variety, prices are competitive, and the shipping is very fast.

[Mohave]

Yikes, this is truly frightening. My hair is about to look like Elwin's. Of course what I'm worried about, and I imagine you are too, is not so much getting traditional snuff, but the possibility of a cut-off of access to all overseas products including Swedish snus, at the same time domestic alternatives are strangled.

[TropicalBob]

I have read about that credit card cutoff in connection with pipe tobacco orders, and it supposedly will be extended to all online tobacco product purchases. A companion measure will stop shipment of all tobacco products to private residences, whether via USPS or UPS or FedEx or whatever. The target of all this is to drive all tobacco purchases to local stores, where taxes can be collected and regulated product sold.

If SE wins its suit, e-cigs will be a tobacco product. Congrats, eh?

What was that about ordering online again?

[LaceyUnderall]

TB - Newbee here on ordering tobacco products online... so is this a credit card company measure solely or is there legislation or something that I should read regarding this concept you have noted? (buying from local smoke shops vs online).

[TropicalBob]

Lacey, I don't keep links. Would be nice if I did, but I don't. On a pipe tobacco site I visit, there was a long commentary by the owner on why he could no longer ship his products. He was leaving the online business. In that piece, he noted what could be a rumor that shipments will be limited before long, allowed only to business addresses.

His main complaint concerned a squeeze by insurance companies that would send his rate soaring. The main point was he had no way of knowing who he was selling to online. He might sell to a child who then was injured by use of his product. A lawsuit would follow. The insurance company might have to pay. So his rates were set to skyrocket unless he stopped online selling. Which he did.

I've seen many posts, BTW, about restrictions proposed for shipping of tobacco. It allows state taxes to escape unpaid, for one thing. Stores would give up online sales if taxes had to be collected for every single state, given the variations in tax rate. Yes, a computer can do a lot. But, yes, it's just one more bureaucratic layer some can't stomach.

Lord help us if e-cigs become "tobacco products" and face that taxation nightmare.

[LaceyUnderall]

Thank you for that synopsis.

Originally Posted by TropicalBob

Lord help us if e-cigs become "tobacco products" and face that taxation nightmare.

As for this... it just means that we are going to have to be proactive as an industry and see if we can get one tax rate for us all, regardless of state, brick and mortar, or online. (IF that is even possible). But we are going to have to think ahead regarding this because we KNOW they are going to want taxes and we are foolish to think they won't. So us coming out with an idea would be an excellent compromise or card to lay on the table, towards compromise.

I am not even going to go into the insurance co. discussion. That's an entirely different worm.

Just something to think about for us...

[OutWest]

Legally, one state cannot make a vendor in another state collect sales tax on an item shipped to that state (Ie: if I ship an item to NY, NY State cannot make me collect sales tax on the sale because I dont have a physical presence there). That was decided back some time ago in Quill Corp. vs. North Dakota. BUT, some states have gone after online cigarette sellers (I think all they've managed to do is to force them to turn over customer lists so that they can then go the customer and collect the tax, but I'm not 100% sure on that).

edit - see posts below - according to federal law tobacco tax is required to be collected. So, while they cant make you collect sales tax, they can make you collect tobacco tax. Thanks Tone!

On a similar note, Calif is working on a reverse use tax on alcohol, which, if passes, will make california vendors collect california tax on wine and other alcoholic products that are shipped out of state.

If it's simply merchant acct providers not wanting to provide merchant accts to vendors, there are ways around that, just like how some of the online casinos got around the federal law against transactions from banks or similar institutions to online gambling sites; they simply introduced a fourth party to the mix for the money to go through. I dont know if theyre still doing that or not, but I know when the law first went into effect they were doing it.

Age restriction delivery can be handled the same way the wine vendors are doing it (some use a 3rd party to verify age, others simply send UPS or Fedex with Adult Signature Required - but worth noting that if the delivery person fails and lets a minor receive it, the responsibility, blame, and any penalties can fall back on the seller rather than the delivery company)

But, here's a question - does the Waxman bill have any sort of restrictons regarding online sales of tobacco products? If so, and if ecigs get legally defined as tobacco, we might be screwed...

(edit to fix a couple of things)

[Tone]

a little info for ya
Cigarette Tax Enforcement

[LaceyUnderall]

Originally Posted by Tone

a little info for ya
Cigarette Tax Enforcement

From Tone's link:

Internet and Direct Mail Vendors -- Sellers
Federal law specifically requires that all vendors who sell cigarettes over the Internet and by mail order to register with the state tax administrator in any state that has a cigarette tax before they advertise or make any shipments to that state. Clearly, that would include New York State and New York City. These vendors are also required to report all sales and shipments to these states, and, in the City's case, also report sales and shipments to New York City, to ensure that the cigarette tax is paid.

Vendors who fail to comply may face criminal and/or civil liability for mail and/or wire fraud and for violation of the Racketeer Influenced and Corrupt Organizations (RICO) Act.

***
Jesus pete! That alone right there is enough paperwork for a lifetime!