Cook County Board President Toni Preckwinkle was joined by Cook County Sheriff Tom Dart today to announce their offices’ joint efforts to crack down on business and individuals who want to skirt the Cook County Tobacco Ordinance requiring retailers and individuals to pay the cigarette tax.
Since their collaboration was launched earlier this month, the Department of Revenue has increased the number of Investigation officers and has worked in close cooperation with the Sheriff’s office to ensure further compliance by Tobacco product retailers throughout the County. Investigators can conduct investigations quicker per location, eliminate unnecessary dialogue, ensure public safety of everyone involved, and provide a professional environment for the retailers being investigated.
To date, investigators have confiscated an assessed value of more than $353,000 in illegal cigarettes. In the first week of collaboration (9/12 – 9/16), investigators wrote 71 citations that had an assessed value of $166,550 in fines. They also confiscated 1,199 cigarette packs, 307 loose cigarettes, which were being sold illegally. In the second week, investigators wrote 49 citations that had an assessed value of $187,225 in fines. Just a few days ago, investigators confiscated 2,471 unstamped cigarettes in a single seizure with an assessed value of $61,775.
“We are taking every step we can to increase public safety and maximize the revenue we need to provide high-quality services that the people of Cook County depend on,” said Cook County Board President Toni Preckwinkle. “I want to thank Sheriff Dart for his willingness to collaborate us and helping strengthen fiscal responsibility in County government. In these difficult economic times, government has to do more with less so this revenue is critical to County operations.”
At a news conference, President Preckwinkle and Sheriff Dart launched the County’s Cigarette Tax Reward Program, one facet of their offices’ collaborative efforts. The program asks residents to report retailers who are in possession of cigarettes without the Cigarette Tax Stamp, with a taped on or fraudulent stamp, or loose and individual cigarette sales, all practices associated with the rampant, multi-billion dollar enterprise of cigarette smuggling. Through the new initiative, citizens may receive up to one thousand dollars reward if they report violations of the Cook County Tobacco Ordinance to the Department of Revenue leading to unlawful tobacco confiscation and a fine being paid.
Currently, Cook County has a $2 per packet Tobacco Tax on all cigarette packets sold within the County. Since the tax rate is higher than the immediate collar Counties, many retailers within the County resort to selling cigarette packets for which a tax has not been paid. In most cases that price of the packets sold will include the tax; however, the difference is that the retailers are profiting from the higher price instead of remitting the tax back to the County. This tax evasion directly impacts public health and safety related services that the County provides to its citizens.
“This is not an insignificant offense and we are taking this very seriously,” Preckwinkle said. “We are currently looking into various ways to address this problem at the County level while stepping up our enforcement efforts.”
Sheriff Dart reiterated President Preckwinkle’s comments about the fiscal imperative of cracking down on cigarette smuggling, while also stressing his commitment to supporting her agents’ efforts to enforce county codes.
“We know that those who engage in fraudulent and illegal activities of any kind are a nuisance to their community because where we find one illegal activity, we often find more,” he said. “We have an obligation to support and protect the many business owners who do things the right way, while doing all we can to go after those who don’t.”
Calling for greater accountability, Sheriff Dart suggested stiffer penalties against businesses cited, while also recommending the county develop a license to sell cigarettes for all county businesses, modeling it after the City of Chicago’s license.
The County is also asking for citizen participation to help enforce the prevention of cigarette smuggling so that the County can maximize revenue and continue to provide key funding for public safety and healthcare to its residents. The Department of Revenue is expected to bring in roughly $126 million from the cigarette this year, and the new initiative is aimed at maintaining this revenue level, while driving away illegitimate cigarette sales in the County. The County has set up a TIP hotline (312) 603-6870 #3 and a TIP website located at http://cookcountyil.gov/revenue for residents to assist the Department of Revenue and the Sheriff’s office.
The Department of Revenue has already made great strides in slowing the rate of revenue decline and increasing compliance throughout Cook County. In 2009 the Cook County Department of Revenue launched a Tobacco Investigation Unit that enforces the Tobacco Tax throughout the County. Since then the Department has made numerous improvements to the process including, bringing violators into the Administrative Hearing process that levies hefty fines for noncompliance and improving security of the stamps (the proof that a tax has been paid) to eliminate counterfeiting activities.