What is an excise tax and why do I have to pay so much?
During a portion of 2005 and 2006 I purchased a total of 18 cartons of cigarettes online for a discounted rate. These were not sold, they were for my own personal use, also for my boyfriend.
I received a bill today in the mail for almost $500 for sales and excise tax. The sales tax total is $60.00, but the excise tax is $420.00. What exactly is the excise tax and how is the state of NJ able to charge me the excise tax and is there anything I can do to reduce these charges?
I just wanted to get some answers before I called and paid anything.
Best Answer - Chosen by Asker
I take it you live in NJ? Sorry to have to tell you this, but if you buy cigarettes there are taxes on the cigarettes that you buy. If the seller doesn't collect the excise tax from you (which if it sold at a discount rate the seller probably didn't), and your state finds out about it (I am seeing more questions in yahoo answers regarding this issue) then they will send you a bill for the uncollected taxes (possibly also interest and penalties). Nothing you can do to reduce the charges.
NJ rate is 2.40 per pack effective 7/1/2005.
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