Illegal tobacco projected at 80 per cent next year
by MPP Toby Barrett

According to an independent research firm, GfK Research Dynamics, almost half the cigarettes consumed in Ontario last year were contraband. And if the rates of contraband tobacco use documented in this study continue to rise at this pace, the level of contraband use in Canada could rise to 80 per cent by the end of next year – all this according the Canadian Convenience Store Association.

There are those who argue high taxes are necessary to prevent smoking – the problem is, well over half the smokers in Ontario don’t pay any taxes at all. High taxes have moved these people to the zero-tax market – driving their consumption up.

Hence my Private Members Bill – Tobacco Tax Reduction Act -- as was done in 1994, to eliminate the incentive – the motive – for illegal use. If tax policy, plus enforcement, education, and border control breaks the back of the illegal trade we can predictably expect government’s to again ratchet up tobacco taxes.

A few months back, Cancer Care Ontario and Hamilton’s public health department spoke to contraband tobacco in the Hamilton Spectator. “We are very concerned about the impact of inexpensive contraband cigarettes on smoking rates,” said Rob Cunningham of the cancer society. “We do know it’s very bad in southwestern Ontario and has gotten worse in the last couple of years.” Jan Johnston, a public health nurse said: “It’s the contraband that has the negative effect on all the progressive tobacco control measures because of the availability and affordability.”

And a recent study of high school smokers, published in the Canadian Medical Association Journal, indicated anti-smoking strategies aimed at young people are not working due to the accessibility of cheap illegal smokes. “The widespread use of First Nations/Native brand cigarettes, especially in Ontario and Quebec, presents a serious challenge to tobacco-control strategies,” warned Dr. Russell Callaghan of the Centre for Addiction and Mental Health.

This past August, a Pollara survey reported 64 per cent of Ontarians believe both the federal and provincial governments should be doing more to stop the illegal cigarette trade, and 42 per cent felt taxes should be cut as in 1994.

The tax-cut solution is not new. In 1994, Prime Minister Jean Chretien, Premier Bob Rae and four other provinces, realized illegal tobacco was out of control – they dropped taxes and shut down hundreds of illegal smoke shacks overnight. In 1994, only 11 per cent of tobacco was illegal – considerably less than today’s 50 per cent. And to quote our local MP of the day during the debate: “In my riding alone I have 200 smoke huts on the reserve. I have had many people including the band council and most people on the Six Nations say: …..would you please do something about this problem. This problem is hurting our community.’”

One goal is to create a level playing field for hardworking tobacco farmers, processors, manufacturers and corner store operators – none can compete with those who don’t pay taxes.

Will more people smoke if my bill passes and taxes are cut? The answer is NO! Half the smokers in Ontario have their cigarette taxes cut to zero as it is.

If my bill does not pass, what will the nay-sayers do if illegal tobacco consumption hits 80 per cent next year? Fore-warned is to be fore-armed.