The stakes have grown higher in the past decade as the state cigarette tax rose from 56 cents to $4.35 a pack. New York City adds $1.50 per pack.

Last month, however, the state won a court victory and started cracking down. Wholesalers, which are non Indian businesses, must now pay the tax up front to the tax department, then recoup it from the Indian retailers. But since June 21, the tribes haven’t been buying.

The tribes challenged the law last year and delayed enforcement until June 21, when they lost in state court. Since then, orders have dried up.

“They haven’t purchased any from us,” said Jake Kern, with Jacob Kern & Sons in Lockport, which sold about 4 million cartons to tribes over the past year more than any other wholesaler. “You think they’re going to spend $43.50 for a carton extra?”

The Seneca, Oneida and Onondaga nations say they will sell their remaining inventory of nationally known brands, then switch entirely to Indian produced cigarettes the tribes say are beyond the reach of taxes.

“It looks as though the state has created an excellent market for native made brands,” said Joe Heath, attorney for the Onondaga Nation.

Without taxes, Indian made cigarettes often cost less than half the price of a name brand pack at a non Indian retailer.

Until now, tribes have bought Marlboro, Camel and dozens of other brands from wholesalers tax free, then sold them without collecting and sending on state and local taxes. New York won the right in 1994 to collect the taxes but has delayed enforcing it.

After decades of court battles, the state in 2008 passed a law that put the burden of the taxes on wholesalers.

Estimates for how much tax revenue the state has lost on sales on Indian reservations ranges widely. The state had hoped to collect about $130 million a year from the tax enforcement.

The state will receive some money and the tribes will lose some revenues, but it’s not clear yet what those numbers will be, said Cornell University economist Michael Lovenheim.

“This could have a pretty negative effect on the tribes because the loss of revenue to them might be substantial,” said Lovenheim, a public policy professor who has studied tax evasion on cigarettes and alcohol. “I would expect this would increase revenue for the state. The question is how much.”

The state hopes to collect tax money from brand loyal smokers who will now buy their smokes at non Indian stores. A governor’s spokesman and the head of the state’s convenience store association said sales are up at stores near Indian reservations, although neither could provide specific figures.

While it’s true that revenues are higher than a year ago at Nice N Easy convenience stores, a company executive said, it’s impossible to know why.

Executive vice president Fran Duskiewicz noted that the standard year to year comparisons are difficult because on July 1, 2010, the state increased the tax per pack by $1.60. That was the biggest single tax hike ever on cigarettes in New York.

“That just ripped 25 percent of the cigarette volume right out of these stores,” Duskiewicz said. “The (recent) increase could be the fact that we just cycled around to a very dramatic price increase a year ago.”

Nice N Easy has stores near Oneida and Cayuga Indian retail locations.

In addition, Duskiewicz said, tribes may have stocked up on name brand cigarettes in anticipation of the state’s enforcement. In court papers last year, the Oneida said they maintain an inventory of about 58,000 cartons of national brand cigarettes, or about five weeks’ worth of sales.

The fate of the tribal stores might hinge on their ability to persuade smokers to switch from name brands to Indian made cigarettes. Price is the big lure At an Oneida nation SavOn convenience store, name brand cigarettes sold recently for $69 a carton. One of the Oneida brands, Niagara’s, was $39.95.

In anticipation of the new law, the Oneida Indian Nation in 2008 bought a cigarette plant in Western New York and later moved it to Oneida territory. Four licensed manufacturers operate on Seneca lands, Porter said. The Onondaga have considered opening their own plant, but their attorney, Joe Heath, said he did not know the status of those plans.

The Oneida nation said it will sell only its own brands.

“Other cigarette brands not manufactured on Oneida nation homelands are available to our customers as long as current supply in our stores last,” nation spokesman Mark Emery said.

The Oneida sell cigarettes in their SavOn convenience store chain and at Turning Stone Resort and Casino. In 2009, the last year for which figures were available from the state tax department, the tribe sold about 1.6 million cartons. The Onondaga sold 1.2 million cartons.

At the SavOn station just off the Thruway in Canastota, and at the Onondaga smoke shop on Route 11 in Nedrow, most of the shelves are stocked with native brands.

State officials said last week they have seized nearly 20,000 cartons of untaxed cigarettes since enforcement of the law went into effect 6,500 cartons of those were Indian made.

Many illegal cigarettes have nothing to do with Indian reservations. Smugglers often cart truckloads of cigarettes to New York from low tax states such as Virginia, which charges just 30 cents per pack.

Tribes say they can manufacture their own cigarettes and either sell them on their own reservation or ship them to another tribe’s reservation, and the state can’t tax those packs. State officials decline to talk about whether the state would try to intercept shipments between reservations.

If the state does that, tribes say, they’ll go to court.

“I think they have some problems trying to do that kind of interdiction,” Heath said. “It’s the Haudenosaunee’s view that they have the right to trade with their sister nations within the confederacy as guaranteed by treaty.”

Contact Glenn Coin at gcoin or 470 3251.

The marlboro man

What brand of cigarettes did barack obama smoke

PRODUCT Marlboro cigarettes
DATE INTRODUCED 1955
CREATOR Leo Burnett Co.

The most powerful and in some quarters, most hated brand image of the century, the Marlboro Man stands worldwide as the ultimate American cowboy and masculine trademark, helping establish Marlboro as the best selling cigarette in the world.

Today, even a mention of the Marlboro Man as an effective ad icon brings protests from healthcare workers who see first hand the devastation wrought by decades of cigarette smoking. More than any other issue, the ethics of tobacco advertising both morally and legally have divided the advertising industry.

But even those ad professionals who abhor the tobacco industry will, when pressed, agree that the Marlboro Man has had unprecedented success as a global marketing tool for selling Philip Morris Cos.’ brand.

In the beginning back in the 1950s, a time when cigarettes were accepted in even the politest society, Burnett created the macho icon as a way to reposition Marlboro from a “mild as May” ladies cigarette to a product with broader appeal. The original newspaper ad from Burnett carried the slogan “delivers the goods on flavor” and it immediately sent sales skyrocketing.

By the time the Marlboro Man went national in 1955, sales were at $5 billion, a 3,241% jump over 1954 and light years ahead of pre cowboy sales, when the brand’s U.S. share stood at less than 1%.

Despite his appeal, the cowboy wasn’t the only rough and tumble image used to sell the brand’s image. Over the next decade, Burnett experimented with other manly types ball players, race car drivers and rugged guys with tattoos (often friends of the creative team, sporting fake tattoos). All the pitches worked.

Even with the release in 1957 of the first article in Reader’s Digest linking lung cancer to smoking, the real men of the Marlboro ads kept ringing up sales ($20 billion that year), attracting new smokers of both genders. In 1964, the company revived the cowboy but this time he was in mythical Marlboro Country.

This vivid image paid off in 1971 when cigarette ads were banned from TV. The striking print shot of cowboys enjoying a smoke on horseback continued to fuel sales growth. In 1972, Marlboro became the No. 1 tobacco brand in the world.

As the anti smoking movement has spread, the Marlboro Man has come under particular attack for his role in luring new customers to a cancer causing habit.

As a commercial icon, he is both reviled and revered. Yet one measure of this icon’s clout is that no matter how minimal the imagery gets reduced on occasion to little more than a saddle and splash of red it still remains instantly evocative of a mythical Marlboro country, of a mythical American cowboy and of the No. 1 brand of cigarettes that gave that cowboy real lung cancer.

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