[Congressional Record Volume 154, Number 143 (Wednesday, September 10, 2008)]
[Extensions of Remarks]
[Page E1755]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             PREVENT ALL CIGARETTE TRAFFICKING ACT OF 2008

                                 ______
                                 

                               speech of

                        HON. SHEILA JACKSON-LEE

                                of texas

                    in the house of representatives

                       Tuesday, September 9, 2008

  Ms. JACKSON-LEE of Texas. Mr. Speaker, I rise today in support of 
this Act. The Prevent All Cigarette Trafficking Act, or PACT Act, 
introduced by Congressman Bob Weiner of New York, strengthens our law 
enforcement capabilities against illegal smuggling of tobacco products. 
I urge my colleagues to support this bill.
  Every year, tens of billions of cigarettes are illegally smuggled 
across State lines and across borders. This fraudulent activity not 
only harms the public health, but deprives State and local governments 
of sorely needed tax revenues.
  In fact, tax evasion is a chief motivator for cigarette smuggling--
buying the cigarettes in a State where the cigarette tax is low, and 
selling them in a State with a higher tax. Because of the tax evasion, 
the trafficker can sell the cigarettes at a discount and still turn an 
illicit profit.
  States lose a billion dollars in uncollected taxes each year as a 
result of cigarette smuggling. The illicit profit also helps finance 
other criminal activity--a revenue stream for organized crime.
  Because of the scope and interstate nature of this activity, States 
cannot adequately address it on their own. It has long been recognized 
as a Federal matter.
  But the existing Federal statutes--the Jenkins Act, which requires 
reporting interstate cigarette sales to tax officials in the buyer's 
State, and the Contraband Cigarette Trafficking Act, which prohibits 
knowingly dealing in contraband cigarettes or smokeless tobacco--are 
simply not up to the task in the Internet Age.
  The Internet, in particular, makes it possible for today's tobacco 
smugglers to be even more mobile and invisible, and to operate with 
near impunity.
  Even when the smugglers can be identified and pursued, they can 
simply shut down operations and quickly reappear under a new name and 
website.
  The PACT Act addresses the shortcomings in current law by targeting 
the delivery systems for illegal Internet tobacco sales--the postal 
system and commercial delivery services.
  With limited exceptions, sending tobacco products through the U.S. 
mail will be criminally prohibited. And vendors using commercial 
delivery services for retail sales will be required to notify the tax 
authorities in the receiving State, conspicuously label all tobacco 
products, verify that the purchasers are of legal age, and keep careful 
records of all sales.
  The bill raises cigarette trafficking from a misdemeanor to a felony. 
And it authorizes the Bureau of Alcohol, Tobacco, Firearms and 
Explosives to inspect the premises and files of sellers of significant 
quantities of cigarettes or smokeless tobacco.
  H.R. 4081 enjoys support from a diverse spectrum of entities, 
including the National Association of Convenience Stores, Altria, the 
Campaign for Tobacco-Free Kids, the American Wholesale Marketers 
Association, and the National Association of Attorneys General, among 
others.
  I commend my colleague, Mr. Weiner, for his leadership on this 
important legislation. I also commend Judiciary Committee Ranking 
Member Lamar Smith for his leadership in making this a bipartisan 
effort.

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