County warns cigarette tax cheats: You’re going to get burned
BY LISA DONOVAN Cook County Reporteremail@example.com September 30, 2011 4:02PM
Updated: November 15, 2011 9:16AM
Chicago-area stores profiting from under-the-table cigarette sales may see that business plan go up in smoke.
That’s because Cook County is stepping up enforcement of the $2-a-pack cigarette tax, even offering rewards of up to $1,000 to anyone who reports — and investigators are able to verify — that an outlet is skirting the tobacco tax, Cook County Board President Toni Preckwinkle and Sheriff Tom Dart announced Friday.
The sheriff said that just looking at the revenue numbers is troubling. In 2006, the county collected $200 million in cigarette taxes, while in 2010 the county captured $126 million.
Certainly the falling smoking rate nationally and local indoor bans on smoking have put a crimp in sales, but that doesn’t tell the whole story, Preckwinkle and Dart say.
“There’s probably some people that have given up smoking and just stopped it, but I don’t think that accounts for $74 million,” Dart said.
Preckwinkle believes there are cases in which a store may be collecting the money — and then pocketing it.
After beefing up the investigative arm of the county’s revenue department and bringing sheriff’s officers in to aid with the probes in recent weeks, officials have slapped a series of stores with more than $400,000 in fines for those selling cigarettes under the tax radar.
In all of 2010, $1.6 million in fines were levied.
Dart said tax cheats are typically ratted out by neighboring stores where owners are paying their taxes. Preckwinkle said to encourage reporting, rewards are now being offered to anyone who helps track a tax cheat by calling the tip hotline at (312) 603-6870, extension 3.
Cigarette taxes are typically collected and remitted to the county by wholesalers who work with local stores.
Revenues from the tax help pay for law enforcement and the health and hospital system in the county, Preckwinkle said.
That money is crucial as she works to close a $315 million gap in next year’s $3 billion budget plan that she’ll unveil in October.
“This revenue, if we continue our efforts, will be of great assistance to the finances of our county in the weeks and months to come,” Preckwinkle said.