For many years, cigarette bootlegging became one of the most profitable and low-risk underworld rackets around. It was often likened to what alcohol bootlegging had been for the underworld back in the 1920s.
This was a racket scheme that started in the 1960s in New York City and a few other northeastern states that had started taxing cigarette sales more heavily. Under the guise of dissuading the public from the newly discovered unhealthy consumption of tobacco, certain states began to levy a heavy tax on retail cigarette sales.
It also became a good excuse as another major revenue-producing source for New York State. By heavily taxing the sale of tobacco, the state coffers swelled with many additional millions that they wouldn’t have otherwise seen.
Collectively between the federal, state, and city taxes imposed, racketeers soon saw the potential for big profits by smuggling cartons of cigarettes up from several southern states where the tax levy was negligible.
By 1965, it had become a somewhat steady racket for organized crime. And by 1967, it had become the rage for certain mafia “crews” and individual mob guys to specialize in “cigarette bootlegging”, or “butt-legging” as it was now being called.
Many states became subject to cigarette smuggling but with their heavy tax levies, New York, New Jersey, Pennsylvania, and Massachusetts were among the top states losing the most tax revenue because of the bootlegging.
