A traffic stop near the Minnesota border last year was the largest seizure of untaxed tobacco in state history.
According to Minnesota’s Department of Revenue, state troopers found $78,000 worth of tobacco products in a rental van. It was stopped on Interstate 94 shortly after entering Minnesota from Wisconsin on June 2, 2016, missing the weigh station at Lakeland.
As the New Richmond News explains, high-taxed tobacco states are targets for black market vendors, who are known to bring unmarked or untaxed cigarettes from low-tax states to sell.
The van’s occupants were from Illinois, where the tobacco tax is $1.98 per pack of 20 – about $1 less than in Minnesota. Meanwhile, Wisconsin taxes 71 percent of the wholesale price.
Mohammad A.M. Abdul Majid and Iman Gencehan Ugurlu were charged last month and appeared in Washington County District Court for aiding and abetting possession of untaxed tobacco products and aiding and abetting aggravated forgery.
According to the news release, the two men said they were making a delivery for Ugurlu’s uncle’s business, Statewide Distributors Inc., but couldn’t provide the company’s USDOT number.
When they provided an invoice for their shipment, troopers could find no trace of a company named Statewide Distributors nor the name of the listed wholesaler, Hudson Wholesale LLC, at the addresses given.
Upon searching the cargo area, police found it “completely full of loose and palletized tobacco products,” prompting troopers to call in Department of Revenue officials who obtained a warrant to seize the property.
The DOR says that tax of $74,000 was owed on the products. That’s because Minnesota implements a 95 percent excise tax on the wholesale price of tobacco.
This is the largest-known seizure of untaxed tobacco products in Minnesota history, the DOR says.
Each defendant faces a maximum penalty of 5 years in prison for each charge, a $10,000 fine, or both.