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Hundreds face tax bills for online ciggies

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Internet Security Threat Report 2014

Residents of Michigan who bought cigarettes over the web in the last four years are facing tax bills for their purchases. Tax demands averaging $2,500 are being sent to 553 people.

The letters went out last week and residents have until mid-March to pay up.

Michigan has ordered 13 online tobacconists to hand over details of any customers in the state. The first raft of demands have gone to customers of just one site. More letters will go out as information is gathered from other websites.

Michigan levies $2 per pack, one of the highest in the US, and brought in $993m in tobacco taxes last year. When the tax went up last year the state expected more people to turn to out-of-state sales.

Tobacco sales are covered by the Jenkins Act which requires tobacco sellers to report anyone who buys tax-free cigarettes to the relevant authorities. ®

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