Jerome Horton, Chairman of the California Board of Equalization, led a team of enforcement agents last Wednesday, in the destruction of 32 pallets of contraband tobacco products, valued at in excess of $600,000, that closely resembled authentic Cuban cigars, hookah and pipe tobacco, and domestic, brand-name cigarettes.
The two truckloads of counterfeit products were unloaded and dumped onto the pile of trash and other debris at the Badlands Sanitary Landfill in Moreno Valley. Horton opened the first container leading the way for the agents to empty the trucks onto a pile before the massive landfill bulldozers crushed the material that would have produced nearly $166,000 in tax revenue for the state and local governments if they were sold by legitimate, Board of Equalization permit holders.
“These illegal cigarettes are often sold in minority communities and could be laced with chemicals that add to the health risk associated with smoking cigarettes,” said Horton. “In addition, the taxes unwitting buyers pay to the retailers, selling illegal contraband, are not remitted to the state, thus stealing our tax dollars and cheating our local community of tax revenues.”
“The revenues they collect from California taxpayers and do not remit to the state,” Horton continued, “helps fund criminal activities from prostitution and human trafficking, to terrorism and gun smuggling. Their activities perpetuate crime in our community.”
Overall tobacco tax losses to the state are estimated at $276 million annually, $182 million of which is attributable to cigarettes alone. The California tax on a carton of cigarettes is $8.70, and the losses add up quickly.