COLUMBUS — Ohio residents who bought cigarettes over the phone from out-of-state vendors are being fined by the state, racking up a total of about $2.2 million in uncollected cigarette taxes.

The state Department of Taxation sent out bills to about 5,500 residents after requesting the names of Ohioans who purchased cigarettes from five vendors between July 2007 and March 2008.

Most bills totaled less than $600, though one person received a bill for about $2,700. Those who refuse to pay could be referred to the Ohio attorney general’s office and face penalties, including property liens.

In Franklin County, about 400 people were billed about $140,000 for about 11,000 cartons of cigarettes. Cigarette prices in Columbus range from about $4.50 to $5 per pack.

The current cigarette tax is $1.25 a pack or $12.50 a carton, plus a 5.5 percent state sales tax. County and transit-authority sales taxes range from 0.5 percent to 2.25 percent.

Marjorie Kochalko, 83, of Hebron, was billed $300 for 24 cigarette cartons she purchased over the phone from a company in New York.
Kochalko, who has smoked since she was 21, said she bought the cigarettes through the mail “because they are a heck of a lot cheaper,” but added she didn’t know she was obligated to pay taxes on them.

“I am afraid not to pay for fear they are going to come and get me,” Kochalko said.

Taxation department spokesman John Kohlstrand said people who sell cigarettes without paying taxes are undercutting smokers and business owners who follow the rules. He said the state does not rule out the possibility that some cigarettes were resold.

“But I think, by and large, we are talking about cartons that were purchased for individual use,” Kohlstrand said.

Kochalko said she intends to pay her bill. The tax department is letting her pay her bill in $100 installments. And she has a plan for the next time she wants to replenish her stash of cigarettes.

“I think I will start going to Kentucky, pay cash and smuggle them back,” Kochalko said. “I know I’m cheating the state, but they are on this smoking bit pretty hard.”  

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