House Ways and Means Subcommittee Takes Critical First Step to Protect Public Health and Taxpayers from Tobacco Smuggling

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May 27, 2010, 11:36 ET

Statement of Matthew L. Myers, President, Campaign for Tobacco-Free Kids

WASHINGTON, May 27 /PRNewswire-USNewswire/ -- The House Ways and Means Subcommittee on Oversight, in a congressional hearing today, took a critical first step toward combating tobacco product smuggling and the tax evasion and public health harms it produces.

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The smuggling of cigarettes and other tobacco products is a serious problem that undermines efforts to reduce tobacco use and save lives, funds criminal activity and costs federal and state governments substantial sums of revenue.

That is why it is important that Congress has begun consideration of the Smuggled Tobacco Prevention (STOP) Act, introduced by Rep. Lloyd Doggett (D-TX) and Senators Frank Lautenberg (D-NJ) and Richard Durbin (D-IL). We applaud Rep. Doggett and Senators Lautenberg and Durbin for their leadership in introducing this legislation to promote public health, protect government revenues and fight crime.

The proposed legislation would require tobacco manufacturers and importers to affix a unique identification marking to each tobacco product package. This marking would enhance the ability to track and trace tobacco products and block their diversion into illegal distribution channels. The STOP Act would also prohibit manufacturers, importers and distributors from delivering tobacco products for final sale in the U.S. unless federal tobacco taxes have first been paid. It would establish a variety of other record-keeping and permit requirements to aid law enforcement and keep the products out of the illegal distribution chain.

Tobacco smuggling, which can involve the production and sale of counterfeit tobacco products or the diversion of genuine tobacco products to illegal distribution channels, is a domestic and international problem for which there are solutions.

By evading taxes, smuggled tobacco products are available at below-market prices, increasing tobacco use and the health harms it causes. The smuggled goods also can evade other requirements, such as those mandating package warning labels, meeting fire-safety standards and complying with new product standards under the 2009 law that gives the Food and Drug Administration authority over tobacco

Tobacco use is the leading cause of preventable death in the U.S., responsible for more than 400,000 deaths and more than $96 billion in excess health care costs each year.

SOURCE Campaign for Tobacco-Free Kids