Traffic brisk at LI Indian reservations before new tax

Traffic was brisk at Long Island Indian reservations in Mastic and Southampton this week as smokers seeking to beat the state's new $4.35 tax on Indian cigarette pack sales appeared to be stocking up.

The tax measure, part of this year's state budget, seeks to collect upward of $200 million in state tax annually from the sale of cigarettes to non-natives at tribal smoke shops.

"It's an outrage," said Bruce Levine of Lake Ronkonkoma. "It's beyond an outrage," said Lydia Levine. They were at the Shinnecock Indian Outpost in Southampton Tuesday and bought six cartons of cigarettes that would have been hit with $261 in extra taxes if the new tax had been in effect.

Tribal leaders on Long Island were alternately outraged and perplexed by Gov. David A. Paterson's stand on the tax, which they called a discriminatory measure with devastating impacts on the reservation economies. Tuesday, a federal judge temporarily delayed its implementation for two upstate tribes, but it was unclear whether the ruling applied to the Long Island tribes.

"This is a calculated slaughter of our economic base," said Lance Gumbs, owner of the Shinnecock Indian Outpost and a tribal trustee.

The Unkechaug tribe in Mastic, which operates some 25 outlets along a mile-long stretch in the center of the Poospatuck reservation, last Friday filed for an injunction in U.S. District Court in Buffalo seeking to block the plan, which will tax cigarette wholesalers for tribal sales.

"This is just designed to precipitate a violent confrontation," said Chief Harry Wallace, who added tribes, including the Unkechaug, had been "making progress" in talks with the state as recently as two weeks ago. "And then it stopped," he said.

The Unkechaug complaint says that the new law infringes on the tribe's "federally protected right of self-government" and that the new rules would destroy the Unkechaug's "self-regulated tobacco economy."

The laws would "impose an absolute embargo" on non-stamped cigarettes at reservation stores. It would supersede the tribe's $1-per-pack fee on tribal cigarette sales, used for social and health programs at Poospatuck.

Wallace and Gumbs predicted the rules will fuel an already bustling black market in out-of-state cigarette sales into New York. Pennsylvania and New Jersey don't have such a tax plan.

Wallace pointed to a new community center under construction in the middle of the Poospatuck reservation, as well as college scholarships, city water hookups, paved roadways and home renovations - all made possible by the tribe's fee on cigarette sales.

"It took us out of poverty," he said.