Lowry Proposes Deal On Cigarette Tax

A settlement of a long-running dispute with the Puyallup Indian Tribe over the sale of untaxed cigarettes to non-Indians was proposed Wednesday by Gov. Mike Lowry.

It is estimated that sales of untaxed cigarettes carves about $24 million a year out of state revenues.

Under the proposal, the Puyallups would levy a tribal tax on the sale of cigarettes at reservation smoke shops and share the proceeds with the state. In return, the state Department of Revenue would discontinue efforts to seize cigarettes en route to the smoke shops or catch non-Indians taking untaxed cigarettes off the reservation.

The agreement, however, would fall far short of the state’s estimated tax loss of $9.6 million a year due to sales at Puyallup smoke shops.