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    Black Market Sales Growing

    New York's steep city and state tax hikes on tobacco lead to new business for street hawkers.

    NEW YORK -- Streetwise entrepreneurs, taking advantage of the nation's highest tobacco taxes, are lurking the streets hawking packs of premium brands for $5.

    Cigarette trafficking has exploded in recent months in New York City, The Wall Street Journal reported, attracting veteran and amateur hawkers seeking extra income.

    Why the boom? Last summer, the city raised its excise tax on cigarettes to an eye-popping $1.50 a pack, from eight cents. New York State also raised its levy, from $1.11 to $1.50. The combined $3-a-pack wallop makes cigarettes here the costliest in the U.S., about $7.50 a pack. On the street, $4 to $5 a pack is practically irresistible, the newspaper reported.

    "I go for shopping areas, wherever there's a large crowd," said a 28-year-old cigarette hawker who identified himself as Ave. "I make a good profit, enough to pay my bills."

    With legitimate sales of cigarettes down significantly, business for street peddlers like Ave are good ? and they deprive the financially-ailing of much-needed tax revenue. The number of cigarette-tax stamps sold by the city from August through November was down 50 percent from the same period a year ago, The Journal reported.

    The black market has spread across the city. In Brooklyn, a landlord fearing drug pushers were in the neighborhood called police. The "pushers" turned out to be cigarette vendors. Bootleggers sell untaxed cigarettes from car trunks; cab drivers offer them to passengers; and corner groceries sell them to favored customers. Some street hawkers even approach commuters outside Grand Central Terminal.

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