A picture of Representative Eni F. H. Faleomavaega
Eni F.
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    Stop Tobacco Smuggling in the Territories Act of 2013

    by Former Representative Eni F. H. Faleomavaega

    Posted on 2013-03-05

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    FALEOMAVAEGA. I thank the gentleman for yielding, Mr. Speaker, and I especially want to thank my good friend, the chairman of the House Judiciary committee, Mr. Goodlatte, and Mr. John Conyers, the senior ranking member, for their support of this proposed bill. I would especially also like to thank Jim Sensenbrenner, the chairman of the subcommittee, and the gentleman from Virginia, my good friend, for their support in the subcommittee. I also want to acknowledge Speaker John Boehner, Majority Leader Cantor, and our Democratic leader, Nancy Pelosi, for their support.

    Mr. Speaker, my district faces a serious problem with tobacco smuggling. According to a recent study, in 2010 alone, as many as 5.8 million cigarettes were smuggled into the territory. The study found that tobacco smuggling resulted in the loss of about $725,000 in revenues to the territory. If continued undeterred, tobacco smuggling in the territory will lead to heavier losses in local tax revenues, especially if the cigarette excise tax rate were to be increased. Mr. Speaker, securing and sustaining stable sources of local revenue stream is essential and must be encouraged for the territories, as it has already done for the States.

    It was for this reason I began to look into this important issue. I was disappointed, however, to find that under the current law prohibiting cigarette smuggling, not all the territories were included. Under the Contraband Cigarette Trafficking Act that Congress passed in 1978, it is illegal to ship, sell, transport, or possess more than 10,000 cigarettes per month not bearing the tax stamp of the jurisdiction in which they are found. Violation is a felony punishable by up to 5 years in prison and seizure of the contraband cigarettes and/or both.

    The Contraband Cigarette Trafficking Act currently, however, does not apply to American Samoa, the territory of Guam, and the Northern Mariana Islands. Historically, when Congress considered the bill in 1978, the Senate version defined ``State'' to include the 50 States, the District of Columbia, Puerto Rico, or a territory or possession of the United States; however, the House provision excluded the smaller territories. For some reason unbeknownst to me, the conference substitute adopted the House provision. The conference report describes the House provision as ``more accurately delineating the practical scope of the legislation.'' Mr. Speaker, the bill before us today will correct this oversight under the current law. This important piece of legislation will amend the Contraband Cigarette Trafficking Act to include these territories.

    I urge my colleagues to support this bill.

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