New Jersey could be losing half a billion dollars a year in revenue because of cigarette smuggling. The legislature is considering a measure to crackdown on it.

The legislation would increase the fines and penalties for importing and selling cigarettes without paying the New Jersey tax.

Senator Donald Norcross says the bill is in response to a shift in business tactics by gang members.

 “Because of the tough fines and penalties in many of the drug issues and crimes it’s shifted those people who can make less money, get higher penalties, more fines.  So they’re saying gee how can we make more money? They’re going to cigarettes.”

Norcross says gangs can make up to four dollars a pack.

According to a New Jersey Treasury Department report, about 40 percent of cigarettes in the state are distributed illegally.

Eric Blomgren with the New Jersey Convenience Store Association says it’s not just the state that suffers.

 “Thousands of small business owners who are trying to eek out a profit by playing by the rules they’re being undercut by criminals who are willing to go around the law and give themselves an unfair advantage at the expense of the state and at the expense of honest business owners.”

Supporters of the legislation are hoping tougher penalties will act as a deterrent.