N.C. Reconsiders Cigarette Tax Stamps

North Carolina may bring back its state cigarette tax stamp, which has been out of use for 17 years, the Winston-Salem Journal reports. Today, a House committee on revenue laws meets to discuss the tax stamp.

A tax stamp would counter cigarette smuggling and selling cigarette cartons purchased in North Carolina in other states for a big profit. Analysts predict the stamp could bring in an annual $1 million in excise-tax funds.

In 1993, the General Assembly discontinued the stamp because the revenue generated by the tax wasn’t enough to justify the administrative, enforcement and logistics of the stamp program. With no tax stamp on North Carolina cigarettes, convenience stores, manufacturers and tobacco wholesalers have seen an increasing number of smokers who make the state a destination point for picking up cheaper cigarettes.

“This is a smuggler’s dream, what they live for,” said Jeff Lenard, NACS spokesman. “Price disparities like these are what make it worth selling cigarettes out of duffle bags and in alleyways.”

A cigarette tax stamp would make counterfeiting harder and make tracking and tracing contraband cigarettes easier. “There’s really no way to police the sales now, so having a stamp would help improve the playing field and reduce the impact on our profits from cigarettes sold in South Carolina being smuggled here,” said Rodney Allen, an owner of R&R Distribution.

Currently, only North Dakota, North Carolina and South Carolina do not have cigarette tax stamps.