Two Lower Hudson Valley roll-your-own tobacco shops were among 12 in the Capital District and Hudson Valley that were raided by the state Department of Taxation and Finance, which led to 10 arrests on charges of illegally possessing untaxed cigarettes and tobacco.
The local shops are Tobacco House of C & W, 10 Orangetown Shopping Center, Orangeburg and the Tobacco House of O.Y., 144 Ramapo Road, Garnerville.
At Tobacco House of C & W, the state agency seized two roll-your-own machines, 104 cartons of untaxed cigarettes, 100 pounds of untaxed tobacco and $3,221 in cash. Bao Chai Wang was charged with one class E felony and one class A misdemeanor.
At Tobacco House of O.Y., the state seized two roll-your-own machines, 11 cartons of untaxed cigarettes and $7,122. Xiu Ming Liu was charged with one class A misdemeanor.
The 10 people arrested are all employees or owners of the roll-your-own cigarette outlets. They are alleged to have possessed quantities of pre-rolled, untaxed cigarettes that were to be offered to the general public for sale, a violation of state tax law. There were no immediate arrests at two of the locations raided –one in Ballston Spa, Saratoga County, and one in Monroe, Orange County — but evidence was seized at those stores. The New York State Police, the Department of Homeland Security and several local police departments assisted in the raids.
Undercover investigators with the Tax Department earlier this year purchased untaxed, pre-rolled cigarettes at each location. Cigarette taxes were prepaid as required, so the shops were able to sell the cigarettes for as low as $35 a carton. Some cigarette brands can cost up to $100 with taxes paid.
“Avoiding taxes gives unscrupulous merchants an unfair advantage over business owners who comply with their tax responsibilities,” Commissioner of Taxation and Finance Thomas H. Mattox said in a statement.
“As alleged, these defendants undercut other merchants, cheated the State out of tax revenue, and put at risk the stream of payments the State receives under the Master Settlement Agreement – payments that are vital toward funding healthcare and smoking prevention programs,” he said.