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State seizing Indian-made tobacco

The state since June has seized more than 5 million cigarettes made by Native American companies for failure to pay required state excise taxes.

The seized cigarettes, part of a rapidly growing business of Indian-made tobacco products, represent about $1.5 million in taxes that its traders were intending to avoid, officials said.

Following a court ruling, the Cuomo administration last summer began enforcing a state law banning wholesalers from selling untaxed cigarettes to Indian retailers for sale to non-Indians. The immediate crackdown was aimed at "premium," or domestic, brands, such as Marlboro, that for years had been sold tax-free by Native American retailers.

The administration made clear at that time it was not going to target the expanding market of cigarettes produced by Native American companies, such as the handful operating on Seneca Nation territory. While there is no direct evidence the state has begun a new and direct crackdown on the Indian-made cigarettes, enforcement statistics released by the state showed the number of cigarettes that can be seized even during a "soft" enforcement of the law.

Of the Indian-made brands seized since June, only two were coming from Seneca Nation manufacturers. In one of those cases, the federal Bureau of Alcohol, Tobacco, Firearms and Explosives seized 18,000 cartons originating from the Seneca reservations heading to the St. Regis Mohawk reservation in northern New York.

The Mohawk tribe accounted for most of the seizures during the period, including a January stop by the U.S. Border Patrol and state police that netted 25,000 cartons heading from northern New York to a tribe in Nebraska.

Seneca Nation officials have maintained that any goods, including cigarettes, produced on Indian lands can be sold free of taxes.

email: tprecious@buffnews.com