“Smoke Scam” was the headline on page one of the Daily News at the beginning of the week. Text accompanying that headline informed readers that New York City and State were losing $200 million annually from untaxed and smuggled cigarettes. “$200M lost to smokes smugglers,” read the headline inside. “Yearly city, state tax shortfall from gang & Internet sales.” The story under this headline began: “Freelance smugglers, organized crime and Internet sources are flooding New York’s neighborhoods with cheap cigarettes that would bring the city and state upward of $200 million a year in taxes on the legitimate market.”

It would be a terrific story — if only it were true. But the fact is that the cigarettes in question wouldn’t bring the city and state upwards of $200 million in taxes on the legitimate market. The New Yorkers who are smoking these cigarettes aren’t prepared to pay the upwards of $70 the Bloomberg and Pataki administrations are trying to get for a carton of Pataki brand or Bloomberg brand cigarettes. The way the Daily News has formulated the story simply echoes the public relations line for the city’s bid for a piece of the tobacco lucre. But the astounding $3 that Messrs. Pataki and Bloomberg want New Yorkers to fork over to them for the privilege of buying a single pack was never theirs to lose.

It is an important point for those seeking to understand the scam going on here. The scam is the notion that excise taxes are the government’s money, there for the taking in any amount the government wants. The $200 million actually belongs to the smokers. The New York Sun opposes the smuggling of cigarettes. But even the Daily News is forced to admit that the purchasing of cigarettes over the Internet, a commerce that is moving into the billions of dollars a year in America, is perfectly legal. And it is a rational choice for smokers facing the kind of prices the city is asking for the privilege of buying cigarettes in establishments it licenses.

There are those who will argue that this whole debate is not about tax revenues at all, but about health. But if health were the issue, the city and state could simply outlaw the sale of cigarettes altogether. All the talk about health is hypocrisy. What the governor and the mayor want is a share of the cigarette business. It may be that in the long run they’ll be able to get it, by bringing in heavy enforcement and forcing people to avoid the Internet and Indian reservations. It may yet take to raiding individuals’ cars when they come out of the Lincoln and Holland tunnels. Or it may eventually turn out the way Prohibition did, with the government deciding that in some matters people ought to be able to manage the decisions related to their health, and with the revenue men pricing their claims at rates the market will bear.