Proposal to Regulate Internet Cigarette Sales Gets Rave Reviews

There is growing concern that the Internet has become a tobacco source for minors.

E-commerce continues to grow. In 2003, 195 web sites sold cigarettes.
And while Internet tobacco sales were virtually non-existent 10 years ago, Forrester Research Inc. predicts this year 14% of U.S. tobacco purchases will happen online. That's $5 billion worth.

Now Governor Jim Doyle is proposing a plan that would crackdown on Internet cigarette sales.

Doyle's Communications Director, Dan Leistikow, says, "It's become a very easy way for minors to buy cigarettes as well as for online vendors to evade Wisconsin tax laws."

Many Internet sellers don't charge state excise taxes and don't require age verification for purchases.

That's why the Wisconsin Association of Grocers has been pushing for tougher restrictions for years.

"For the most part anyone can get online for tobacco and get a whole different bunch of sites and order away as much as you want," says Wisconsin Grocers Association President Brandon Scholz, "It's easy to do."

The governor is proposing new rules, which would verify the buyer's age by either requiring a signature on delivery or matching a person's credit card information to the eligibility requirements.

Doyle also wants to require online vendors to follow state tax laws.

Scholz says, "That's principally why their prices are so cheap, because they don't do that. They can sell it for a lot less because they don't charge the sales tax."

He says retailers hope these regulations go through soon.

"If we make sure they collect sales tax and remit it to the state, that will bring prices to an equal level than what we have now and it will be a fair competitive situation between brick and mortar stores and these Internet pirates."

The governor proposed the new system in his budget and hopes the legislature will adopt it when they send him their budget this summer.


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