However, at least some states have stepped in to crack down on the sale of tobacco products to minors over the Internet. Texas, Maryland, and Michigan are among the states that have sued online tobacco merchants for failing to verify the age of their customers. Online cigarette buyers looking for tax-free smokes can buy from foreign companies that sell cigarettes cheap. Smokers can also purchase non-premium cigarettes from Web sites operated on Native American reservations. Law and Order Purchasing cigarettes across state borders does not officially exempt a consumer from state-based tobacco taxes, however.
State laws require that individual consumers report their purchases and pay the state directly.
However, few consumers do so, and states have found themselves having to pursue individual consumers to collect the tax. The U.S. Customs Service has also stepped into the fray. In December, the agency warned that consumers who purchase cigarettes and other products from foreign-based Web sites and bring the product into the U.S. risk becoming ensnared in the intricate legalities of importation law. On the other side of the battleground are tobacco companies who want the right to sell their wares online. The statute, signed in August by New York Governor George Pataki, was the first of its kind in the United States.