(Click here for previous CSP Daily News coverage.)
New York Association of Convenience Stores (NYACS) president James Calvin said, "Law-abiding mom-and-pop retailers are especially grateful to...Weiner...and Senators Charles Schumer and Kirsten Gillibrand of New York for their courageous leadership on this issue of fairness and child health protection."
He added, "Cigarettes are a legal product, and smokers are going to continue to buy them. Congress made a sensible choice to have them sold in a controlled environment where there is verifiable compliance with tax, age verification and other laws designed to protect public health."
The Seneca Nation of Indians, however, denounced the passage of the PACT Act as a "blatant attack on Native American treaty rights." If signed into law, it will bar Native American tobacco businesses from using the U.S. Postal Service for shipment of their products. Loss of that critical distribution channel will cripple the Seneca tobacco industry and result in the loss of more than 1,000 native and non-native jobs, it said.
"This is a sucker punch to our federal treaty rights," said Seneca Nation president Barry E. Snyder Sr. "This is a direct assault on our economy and our people. And it will have a devastating ripple effect on the Western New York economy."
Snyder said it is now up to President Obama to "do the right thing" and veto the PACT Act.
Calvin said the Seneca Nation's claim that the PACT Act will cost 1,000 jobs in their Internet tobacco business assumes that all their customers will immediately stop buying cigarettes altogether, when in reality, there will be a shift in sales and jobs back to licensed, regulated retail outlets.
"It's ludicrous for anyone to claim that helping smokers circumvent tax and age verification laws is a form of economic development," he said.
He cited a study conducted by economist Brian O'Connor showing that if cigarette tax collection laws were being enforced fully and fairly in New York state, there would actually be a net increase of more than 1,300 jobs and $35 million in higher earnings in the retail cigarette market. (Click here here to view the study.)
"Now that Congress has acted," Calvin added, "the next step is for the Paterson administration to proceed with collecting state taxes on cigarettes sold by Native American-run stores to non-Indian customers." He noted that a state law requiring such collection was enacted four years ago this month but has yet to be enforced. Consequently, economist O'Connor has determined that the state is losing $1 billion a year in tax revenue. (Click here to view the updated report.)
The Seneca have maintained that the PACT Act is really a push by big tobacco companies to squeeze out Native American competition and protect market share. The Seneca Nation maintains the measure, which has attracted strong support and lobbying efforts from mainstream tobacco corporations, led by Philip Morris, is an overt attempt by big cigarette corporations to simply stomp out any market competition.
J.C. Seneca, co-chairman of the Seneca Nation's Foreign Relations Committee (FRC), said, "It's ironic that the federal government is willing to forego more than a quarter of a billion dollars in revenues when the Postal Service is closing post offices and cutting service because of financial problems."
Seneca tobacco shipments dominate business at several small post offices on and close to the Seneca Cattaraugus and Allegany Territories, including offices in Irving, Silver Creek, Versailles and Lawtons.
Richard Nephew, Seneca Council Chairman and co-chairman of the FRC, said the House vote marks a "win for big tobacco and sad day for Native Americans. Big tobacco is losing ground to cheaper brands sold in Indian County and now all the states have the ability to regulate the competition out of existence."
The Nation estimated enforcement of the PACT Act could result in up to a 65% loss in import/export revenue that it uses to fund health and education programs. The Nation said that it has a state-of-the-art stamping and enforcement mechanism that ensures compliance with a rigorous set of internal regulations, including retailer authorization, minimum pricing and a ban on sale to minors. The Nation works in close partnership with the Federal Bureau of Alcohol, Tobacco & Firearms Enforcement (ATF), it said.
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