KENTUCKY'S ludicrously low cigarette tax is not only hurting Kentuckians by keeping it alluringly cheap to smoke and depriving the state of badly needed revenue.
It is also hurting other, more responsible states by turning Kentucky into a haven for Internet cigarette sales.
As taxes and prices have gone up almost everywhere else, Internet operations have grown here as ways for buyers to avoid higher taxes in their home states and, worse, for youths to avoid their states' laws against sales to minors.
For now, of course, Kentucky is getting a little extra income from these Internet sales, since the suppliers do pay the state's measly tax of 3 cents per pack.
But that return is coming at a high cost. For one thing, it places Kentucky on the wrong side of the national debate over Internet taxation. States generally agree that Internet transactions shouldn't escape normal state taxes, since that puts local, non-Internet businesses at an unfair disadvantage and since it also allows Internet customers to avoid paying for the government services they enjoy.
For another, the rise of Internet cigarette sellers means Kentucky is now home to businesses that are legally suspect; they seem to be ignoring the minimal age-verification and reporting requirements already on the books.
It's not illegal to buy or sell cigarettes over the Internet, but sellers and buyers appear to be obliged to report their purchases and to pay any state taxes owed under the 1949 Jenkins Act. It expressly requires dealers to report out-of-state sales to the buyers' state tobacco tax administrators.
But that is not happening, according to Mark Smith, a spokesman for Brown & Williamson Tobacco Co. "I've yet to see one Internet company out there that is collecting taxes and verifying age," he said.
Moreover, added Matt Myers, president of the Campaign for Tobacco-Free Kids, "Internet sales to kids is an emerging and growing problem."
Both the federal government and the state attorney general must crack down on such suspect practices. But the best solution would be to eliminate the reason for them.
Kentucky should join the vast majority of other states, whose average cigarette tax is now 58.8 cents per pack, and raise its rate to a level that is both socially responsible and fiscally productive.