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HomeNewsArchivesJUDGE STOPS CONFISCATION OF TOBACCO

JUDGE STOPS CONFISCATION OF TOBACCO

A federal court judge ordered the U.S. Treasury Department Wednesday to stop enforcing a law banning the re-importation of duty-free cigarettes into the United States for personal use.
According to information from Delegate Donna Christian-Christensen's office, the ruling was in response to a lawsuit brought by World Wide Duty Free Shops, a consortium of duty-free shop owners. Attorney Peter Hiebert of Winston and Strawn, legal counsel and Washington lobbyist for the Virgin Islands government, worked closely with the group.
In February, the Source learned that cigarettes and other tobacco products marked "for export only" that were being sold to tourists in the Virgin Islands were being confiscated as the visitors disembarked at points of entry on the U.S. mainland. The tourists were being told to put their cigarettes into bins as they went through Customs.
The action was being taken under a law that went into effect in January that was intended to prevent large commercial wholesalers from re-importing tobacco products. Tobacco marked "for export only" is exempt from Internal Revenue tax and Customs duty.
Wednesday's court order will allow the re-importation of tobacco products purchased up to the limit allowed by the personal use exemption, which in the case of cigatettes is five cartons.
Business owner Vinnie Mohanani, who first found out about the confiscations from a customer in February, said Thursday he was "caught by surprise" by news of the lifting of the ban. And, unfortunately, he has no cigarettes in his shops to sell.
"Both of our stores have gotten rid or our cigarette stock," he said, assuming it would take some time to resolve the problem. "There was no sense in having inventory that wasn't going to move."
Mohanani said he won't restock his shelves until "we have been given some assurance that the ruling is not going to be contested" by Customs or the Bureau of Alcohol, Tobacco and Firearms.
Christensen said there has been no official word from Treasury on the order. "My impression was they were not going to appeal it," she said.
A technical amendment introduced in Congress last month that would provide an exemption to the law for personal-use purchasers is still in the legislative process. It will be tacked on as an amendment to the Caribbean and African trade bills before Congress, according to Christensen.

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A federal court judge ordered the U.S. Treasury Department Wednesday to stop enforcing a law banning the re-importation of duty-free cigarettes into the United States for personal use.
According to information from Delegate Donna Christian-Christensen's office, the ruling was in response to a lawsuit brought by World Wide Duty Free Shops, a consortium of duty-free shop owners. Attorney Peter Hiebert of Winston and Strawn, legal counsel and Washington lobbyist for the Virgin Islands government, worked closely with the group.
In February, the Source learned that cigarettes and other tobacco products marked "for export only" that were being sold to tourists in the Virgin Islands were being confiscated as the visitors disembarked at points of entry on the U.S. mainland. The tourists were being told to put their cigarettes into bins as they went through Customs.
The action was being taken under a law that went into effect in January that was intended to prevent large commercial wholesalers from re-importing tobacco products. Tobacco marked "for export only" is exempt from Internal Revenue tax and Customs duty.
Wednesday's court order will allow the re-importation of tobacco products purchased up to the limit allowed by the personal use exemption, which in the case of cigatettes is five cartons.
Business owner Vinnie Mohanani, who first found out about the confiscations from a customer in February, said Thursday he was "caught by surprise" by news of the lifting of the ban. And, unfortunately, he has no cigarettes in his shops to sell.
"Both of our stores have gotten rid or our cigarette stock," he said, assuming it would take some time to resolve the problem. "There was no sense in having inventory that wasn't going to move."
Mohanani said he won't restock his shelves until "we have been given some assurance that the ruling is not going to be contested" by Customs or the Bureau of Alcohol, Tobacco and Firearms.
Christensen said there has been no official word from Treasury on the order. "My impression was they were not going to appeal it," she said.
A technical amendment introduced in Congress last month that would provide an exemption to the law for personal-use purchasers is still in the legislative process. It will be tacked on as an amendment to the Caribbean and African trade bills before Congress, according to Christensen.