Contraband cigarettes can send tax revenues up in smoke



(The Center Square) – Contraband cigarettes can send thousands of dollars in state taxes up in smoke in Arkansas, where the cigarette tax is $1.15 a pack.

A traffic stop on a van on I-40 near Carlisle earlier this month led to the seizure of 32,671 packs of untaxed cigarettes valued at more than $311,000.

The suspect, 35-year-old Ali Ali Ashabi of El Paso, Texas, is facing charges of possession of untaxed tobacco and unauthorized use of another person’s property to facilitate certain crimes.

If those cigarettes were going to be sold in Arkansas, the state would also be denied wholesale taxes.

“This is tens of thousands of dollars in lost revenue,” Scott Hardin, an Arkansas Department of Finance and Administration spokesman told The Center Square. Additionally, since we do not know the origin of the product or where it’s been, we can’t confirm the product is genuine. Overall, it is illegal and unfair to the 5,000 plus retailers selling legally in the state.”

The seizure is the largest of contraband cigarettes in the state’s history, police said.

“This stop is a testament to the importance of strong relationships among law enforcement organizations,” said Trent Minner, administrator of DFA’s Regulatory Division. “Our partners at State Police immediately contacted Tobacco Control, allowing an agent to arrive on scene quickly.”

Police also seized the cargo van.

“Contraband cigarettes are one of the leading sources of funding for terrorism in the United States,” said ASP Colonel Mike Hagar. “We will continue to work with all our partners at Tobacco Control Enforcement to expose and dismantle organizations behind illegal cigarette operations.”

It is legal to possess a pack or carton of unstamped cigarettes. But anything beyond that violates Arkansas law, Hardin said.

As for the cigarettes seized, they will be destroyed when a court order is issued allowing it, he said.



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