NEW YORK -- The City of New York is suing eight smoke shops that have been selling tax-free cigarettes on a Long Island Indian reserve, reported the Associated Press. The lawsuit accused the small cluster of shops on the Poospatuck Indian Reservation of breaking state and federal law by selling massive quantities of cigarettes to bootleggers.
The suit added that bootlegged smokes are then smuggled off the reservation and resold throughout the New York metropolitan area.
Mayor Michael Bloomberg's administration said the practice has gone on for years and costs the city and state hundreds [image-nocss] of millions of dollars annually in lost tax revenue.
Tribal authorities have long acknowledged that smuggling is a problem, but they defend the right of the shops to sell cigarettes without collecting state tobacco taxes.
"We applaud the Bloomberg administration's tenacity on this issue," James Calvin, president of the New York Association of Convenience Stores (NYACS), told CSP Daily News. "For years, reservation purchasers have been flooding the streets of New York with tax-free cigarettes."
The Poospatuck Indian Reservation is the sovereign territory of the Unkechaug Indian Nation.
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