Tobacco

Illicit Tobacco Seizures Surge, Massachusetts Tax Revenue From Tobacco Sales Plummets: Task Force Report

State is ‘struggling with enforcement,’ says regional association executive director
Massachusetts map
Photograph: Shutterstock

Bootleg cigarette smuggling is an ongoing drain on law enforcement as illicit tobacco seizures surge and state tax revenue from tobacco sales continues to plummet, findings from a new report by the Massachusetts Illicit Tobacco Task Force (ITTF) reveal.

“Despite enforcement efforts and the hard work done by the Illegal Tobacco Task Force, smuggling of untaxed tobacco products remains a significant challenge,” said Peter Brennan, executive director of the New England Convenience Store and Energy Marketers Association Inc. (NECSEMA). “Smugglers are developing more sophisticated operations to counter the task force’s targeted investigations. It’s clear that the commonwealth is struggling with enforcement.”

The ITTF report details a February bust by several federal, state and local law enforcement agencies that included 29 search warrants on businesses, residences, vehicles, individuals and bank accounts.

Investigators seized approximately 280,000 flavored electronic nicotine delivery system (ENDS) products as well as flavored cigars, unstamped cigarettes and $1 million in cash, according to the NECSEMA.

“It’s clear that criminals—including organized crime syndicates—are profiting from bootleg cigarettes and vape and have made contraband tobacco products a lucrative part of their racketeering endeavors,” Brennan said.

In 2019, Massachusetts signed into law one of the nation’s strictest flavor bans of any state. The ban has cost the state nearly $150 million in lost tax revenue from legal sales since it went into effect in 2020, according to the NECSEMA

The report acknowledges the need for continued data collection, compliance resources, and enforcement coordination to uphold state policy. This suggests ongoing challenges in effectively coordinating enforcement efforts and addressing emerging issues within the tobacco industry.

“Moving flavored tobacco products; out of the heavily regulated retail sales environment has been counterproductive and ineffective,” Brennan said. “While criminals rake in cash and flood the streets with contraband to fund illegal enterprises, taxpayers have lost, public health is threatened, and retailers, who continue to demonstrate high rates of compliance, are left to suffer as they follow the law.”

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